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Financial planning is key for anyone who wants to make sure that they’re managing their money in the most efficient way possible. However, financial planning is very situation specific so it’s worth looking at your own circumstances and making them work so that you’re getting the most out of your money, whatever stage of life you’re at. Financial planning as a couple has both advantages and disadvantages; here are some tips on how to work together to get the most out of your money.
Financial Planning For Couples – our tips:
Be a team. This might sound pretty obvious but we all have different styles when it comes to money management – thrifty, save-splurge, high rollers etc – but when you partner up with someone the last thing you want is for your attitudes to finances to conflict. Find a middle ground for managing joint money and agree a few basic rules together as early as possible so that you’re both spending, saving, cutting back and earning interest with the same focus.
Have joint accounts. You’re most likely earning separately salaries so the easiest way to make sure that you can see how joint expenses are being paid is via joint accounts. Use joint accounts for everything from rent and mortgage to household bills and paying for a shared holiday. Keep track of what’s going in and out of a join account by maintaining monthly books – this is the easiest way to monitor your joint financial health and to prevent arguments arising from confusion over who is doing what.
Combine your resources for the best returns. Plan to pool your savings in the best way possible, whether that’s investing together in property or simply finding a savings account with the best interest rates. Set joint savings targets and encourage each other, from planning for a wedding to buying the car you’ve always wanted.
Budget together. Two heads are better than one and that’s especially true when it comes to budgeting. Sit down together and work out incomings and outgoings and see where savings can be made. You can share costs as a couple, which is a big advantage that singles don’t have – for example, if you’re currently trying to save for a deposit for a house and living separately why not move in together to a single bedroom property and share the cost of one rent instead of paying for two? Review each other’s incomings and outgoings and look honestly at what can be cut back and use shared experiences to save money – instead of going out every weekend, stay in twice a month and cook for each other.
Get married. Obviously money shouldn’t be the sole motivator for marriage but you can save significantly by tying the knot. As of April this year, married couples can transfer £1,000 of income tax liability to a partner and there are already married couple tax breaks in place. You can save on insurances as a married couple is regarded as lower risk, attracting lower cost policies, and there are savings on inheritance tax and capital gains tax to be made too (married couples and civil partners can transfer assets without attracting inheritance tax or capital gains tax).