Creating a budget as a couple can be a challenging process. Transitioning from thinking about your own financial needs to balancing your partner’s needs and wants can be difficult.
Starting with the Basics
Before sitting down to plan your budget with your partner, spend some time together discussing your financial habits, goals, and desires. Understanding each other’s perspectives on money can provide a foundation for moving forward.
Identifying Family Needs
Once you understand each other’s financial styles, it’s time to identify family needs. This includes expenses such as rent or mortgage payments, utility bills, grocery costs, car payments, and debt repayment.
Establishing Long-Term Goals
It’s important to set goals to work toward as a couple. These long-term goals should be part of your financial plan. The plan can help you determine when you can buy a home or when you can start a family. It can also assist with planning for retirement or that dream vacation.
Addressing Individual Needs
Once family needs are established, begin discussing individual needs and wants. This can include items like gym memberships, clothing expenses, haircuts, and other items where different amounts may be spent.
Should You Combine Your Finances?
The big question when budgeting as a couple is whether to combine finances. This is a matter of personal preference. However, there are three main approaches.
Combining All Finances
Most couple’s money goes into one account. All income and expenses are shared. Partners may have small accounts for personal spending, but generally, everything is shared.
Keeping Finances Separate
In this approach, each person has their own accounts. Expenses are divided and allocated to each partner. Bills may be split on a 50/50 basis, or they may be based on each person’s income. In some cases, when one partner owns a home, the other might pay rent.
Mixed Approach
Some couples find that a mixed approach makes more sense. Perhaps there is a joint account for household expenses and other shared goals (such as vacations or saving for a home). Each partner contributes to the joint account but retains the rest of their personal accounts. This approach can involve each person contributing the same amount, every partner contributing a percentage of their income, or some other method for determining how much each contributes.
Scheduling Budget Meetings to Track Spending
Couples should engage in tracking spending. A weekly budget meeting usually works well. During this meeting, discuss your progress toward shared and individual goals. Talk about spending in categories and what remains.
Initially, you may need to review this daily, but eventually, you can do it once a week, or even sit down once a month. Choosing a good financial program that you can sync on both of your phones can be helpful. In fact, there are many apps available that are designed to help couples coordinate their finances. As your budgeting tracking improves, these meetings can be shorter and just as effective.
When discussing finances, it’s important to stay calm. If one partner makes a mistake, focus on finding a solution and moving forward. Holding onto mistakes or getting angry is not productive.
Conclusion
Don’t let budgeting create undue stress in your partnership. As you begin exploring the possibility of combining finances and living together, it’s best to establish good habits from the start, allowing you to avoid serious disputes later on.
Frequently Asked Questions
What are the best budgeting apps for couples?
The best budgeting apps for couples are those that can sync across multiple devices so that both of you can access them from your own phones or computers. Some good options to try include Mint, Mvelopes, and Goodbudget. You may need to try a few different apps to find the ones that work best for you and your partner.
How
Can you create a budget?
To create a budget, start by evaluating all sources of your income. Once you know your monthly income, subtract mandatory expenses such as rent, insurance, and bills. Then subtract debt payments such as credit card payments or student loans. The amount that remains is what you can apply to savings goals and discretionary spending.
Source: https://www.thebalancemoney.com/how-to-budget-as-a-couple-2385692
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