Being on the same page financially with your partner is really important, but only 1 in 5 couples make important financial decisions together.
Local financial advisor Sam Gaeta from Defined Financial Planning is here with three questions you should discuss with your partner right now.
Q: Why is this a good time to talk about money?
Â· One-third of couples say finances are a big source of stress in their relationships. It is also one of the main causes of divorce.
Â· During the pandemic, more financial stressors were added to the mix, like job loss, working from home, and trying to find a way to make ends meet during these uncertain times.
Â· Now that the world is opening up, now is a great time to start talking about your financial habits and budget for the future. You will be more successful financially if you work as a team!
Q: What are some questions couples should ask themselves?
- Do we have an emergency fund?
Â· A recent study found that 51% of Americans want to improve the way they save for unexpected expenses.
Â· For many people, the pandemic has forced them to dip into these emergency funds and now many are focused on rebuilding their savings.
Â· Start by creating a budget so you know how much money you can contribute to your emergency fund each month.
Â· Discuss the income of each of you, review your monthly bills, agree on what is considered âourâ expenses and decide how much to put in a savings account.
I have a budget spreadsheet on my website, definiplanning.com, to get you started.
2. How much debt do we have?
Â· Getting your debt under control should be a financial priority after the pandemic. A new poll found that 51% of American adults added to their credit card debt during the pandemic. This was up 23% from May 2020.
Â· As a couple, take an inventory of your debts, including how much you owe and the interest rates you are paying.
Â· A debt worksheet can help you keep track of balances, due dates, minimum payments, and interest rates, and I have one on my website.
Â· Setting up automatic payments can help make sure you don’t miss any payments. Getting hit with late fees only adds to the problem.
3. Are we saving enough for retirement?
Â· The pandemic has prevented millions of Americans from contributing to their retirement accounts.
Â· Get ââyour retirement savings back on track by including them in your monthly budget.
Â· Set aside money, even if it’s a small amount, each month by direct deposit or direct deposit so you won’t be tempted to spend it.
Q: How can couples keep their finances on track?
Â· Be kind to yourself and your partner during this stressful time. It’s okay to make mistakes and adjust things along the way.
Â· Hold an informal quarterly meeting to make sure you and your partner stay on the same page.
Â· Consider meeting annually with a financial professional who can help make sure you’re on the right track.