Money in relationships can be an issue of contention. A commonly known fact is that money problems are the number one reason for divorce. Money problems directly affect many shared life activities associated with relationship satisfaction, such as buying a house, enjoying holidays, caring for children and what you can do on the weekend. When you’re already under financial pressure, the day-to-day management of money can become explosive. Planning a budget is the best way to take the financial stress out of your relationship.
Budgeting as a couple can be difficult. It can be hard to stop looking after yourself and start managing money as a couple. Many people feel like they’ll lose their freedom, and they’ll open themselves up to criticism about their spending. But a good ‘couple’s budget’ will give each party freedom, protect each of you from criticism and enable you both to plan for the things that you share together, such as fun outings together and possibly even vacations
You Will Need:
• A single savings account (of which you both have debit card access).
• Two individual savings accounts (one for each partner).
Step One: Determining Income
Determine your income as a couple. Add all of your wages and other sources of income together. The grand total may be more than you think.
Step Two: Determining Minimum Expenses
List all of your household needs (rent or mortgage, electricity, groceries, phone bills, minimum debt repayments, etc.). These are the expenses that you have to pay; holidays, handbags and golf clubs don’t belong here. Add up your needs budget and subtract this from your income; if there is money left over, then go on to step three.
Step Three: Guilt Free Money
Transfer $20 into each of your accounts. You can spend this on whatever you want without judgement. Gamble it, spend it on lollies, etc.
Step Four: Mutual Goals
List all of your mutually agreed upon wants. This includes all the things you want to do as a couple (e.g. holidays, one a night out per month, saving for a house and paying off debt faster). You’ll need to decide on what to include based on what’s important to you as a couple. You may want a wine subscription, or Foxtel, or to donate to charity; it’s up to you. If there is money left over, then go on to step four.
Step Five: Divide the Spoils
If there is still money left over at this point, then you should put some more of it into your separate accounts. Place the remaining bulk of leftover money into savings or onto any debts that you may have.