Scott Tominaga Guides on Effective Financial Planning for Couples

While differing opinions are quite common experiences in money management, it must not put any pressure when it comes to a couple’s relationship. It should not be the cause of clashes between the life partners. According to Scott Tominaga, a highly acclaimed financial advisor an ideal way to avoid facing such an undesired incidence lies in devising a financial plan jointly while having open communication between two partners. Although there is no thumb rule to manage the finances of a couple, certain interesting strategies particularly for couples can help them develop upright money habits and fortify their financial portfolio over time.

Open Discussion Is The Key

In financial planning free, open, and honest conversation about individual financial status between couples is the first step to begin with. The points to include can cover everything like different sources of income that both have, how much each of them earns, particulars of their debts, credit history, matters associated with real estate, inherent property, and other assets and liabilities. Couples need to remember open and honest discussion is the key to avoiding possible wrangling that can toll severely on the relationship. Both should be frank in sharing individual spending habits, as it will help in finding the expenses they would prefer to share jointly and split financial duties.

Set Joint Money Goals

Developing common financial goals that both partners agree to meet jointly can help alleviate financial stress greatly. Although, both partners can yet maintain their individual financial goals, devising some mutually agreed short as well as long-term monetary goals such as clearing debts that attract high interest, buying a luxury home or car, saving jointly to enjoy a yearly vacation, putting money in money-making investment options will ensure no chances of financial issue.

Ideally, the couple could consider having a joint bank account in which both can deposit a certain amount every month for meeting common expenses including rentals or mortgage installment, groceries, food, utility bills, paying the salary of the maid, etc. This will come in handy to keep track of all household expenses without any ambiguity and no confusion likely to arise. If both partners earn, splitting financial liabilities mutually is a great way to dodge the consequences of monetary distress.

Prepare a Shared Budget

Having a pre-defined budget to stick to happens to be a brilliant way to control undesired spending habits of both and equally monitor closely how much each spent. Preparing a budget jointly to take care of all collective expenses for every month will help in lessening expenses.

For further segregation to maintain a more productive budget, both can think to adopt the 50:30:20 thumb rule. This means couples should keep 50% budget for essentials or ‘Needs’ 30% of the budget for wants or ‘Desires’ and 20% towards savings. It makes sense to plan the investment plans jointly in consultation with an expert finance advisor like Scott Tominaga.

Select an Appropriate Financial Strategy

Couples should choose any of the three popular financial strategies for their prevailing and future finances. Firstly, they can consider merging their monthly inflow of income and share all expenses in equal proportion by dividing all expenses into two portions. Secondly, they can maintain a standalone joint account in which both of them should contribute to cover common expenses.

Thirdly, instead of having any joint account, maintain separate individual bank accounts and accordingly determine how expense bills would be split. Considering the income of each partner, a great way is to go for a 50:50 split while a 60:40 share makes sense in case one partner earns considerably more than the counterpart.

To conclude, couples must consider investing in health insurance collectively especially designed for couples. Equally, developing an emergency fund is a must-have to stay prepared to counteract types of financial crises that may crop up at any time.

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