5 Money Habits for Newlyweds

The Problem: A friend’s crisis exposes financial work we need to do.

We’re getting married! Between all the planning and doing, money and future finances have not been a priority conversation. However, several months ago, a friend of ours was killed in a car accident. As we support his wife and two young children, we see a mighty struggle, not only with loss and grief but also the unknowns of their financial security. Please share some basic insights that will help us build our lives together on a better financial foundation. – Submitted by email from E.H. and M.J

The Solutions:

I am grateful you are with your friend’s wife and daughters during this difficult time. This unfortunate situation has brought to light the need to develop financial intelligence and good habits as you create your own family.

I am not a CPA or Certified Financial Planner, yet I have learned from many that money truly matters. When you place a wedding ring on someone’s finger, it comes with an obligation to provide a secure and stable life for your partner. This means taking responsibility for the basic needs of shelter, food, and financial security. It also includes supporting your lifestyle, paying bills and accrued debt, living within your income, and having risk protection. Here are five important insights.

1. Always keep personal accounts separate from business accounts.

If the business is a legal separate entity (such as a limited liability company or a corporation), mixing personal and business funds can jeopardize the legal protections of your business. This separation also allows for financial clarity; accurate tax reporting; and easier analysis for actual income, expenses, budgeting, and tracking.

2. Create an emergency fund.

This is an easy-access buffer set aside to cover unexpected expenses. Your financial planner may suggest three to six months’ worth of living expenses to provide financial security during tough times.

3. Set a limit.

Set limit on how much can be spent before requiring both of you to discuss, understand, and approve a purchase. It is disrespectful to “surprise” your partner or withhold information about exceeding the agreed-upon limit. Honoring this habit requires forethought and accountability. 

4. Be cautious.

Be cautios with credit cards, other debts, and personal guarantees for business loans. These are contracts, with the responsibility to pay according to the terms. Financial peace is much more rewarding than debt. 

5. Prepare for the unexpected.

What if your spouse dies? Would you be able to continue the lifestyle you’ve created? What would be your secured sources of income? Where would you live? (This is especially important if you are living in a farm-owned house and it is the farmer who is deceased.) 

There is a purpose for life insurance, disability insurance, and diversified investments. These help with immediate disasters and create a more secure financial future for those left behind.

E.H and M.J., placing a wedding ring on someone’s finger is an act of love, but it’s also a call to action. Love is a noun. It is also a verb. It requires honest financial conversations and actions — starting now.