How to make a budget for a newly married couples: Things to consider

By Natasha Culzac
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Whether newly or practically married, budgeting as a couple will help you reach the goals that matter to you.

Whether you’re still picking out the confetti from your hair, or you’re not married but want to spend the rest of your years with your partner regardless, it’s time to start thinking about your financial life together and making thrilling plans for whatever’s to come next.

 You might be bankrupt because of the wedding or perhaps you’re trying to get a deposit together to buy a pad, but now is a great time to pool your resources, understand what you both want out of the near future and to support each other to reach those goals.

We have an awkward relationship with money, particularly when sharing the finer details on our bank balance with someone else. According to research by the Money Advice Service, 24% of married couples say their partner would be ‘upset, angry or surprised’ if they knew the true state of their finances. However, getting this all out of the way now will help to curb arguments further down the line and will hopefully smooth the road for the journey ahead.

The talk

Sit down and be thoroughly transparent about what each other’s incomings are (if you don’t already know), and both your outgoings. This could be the cash received from your salary and investments etc, and then what your spending habits look like. Are there any day-to-day luxury items you just can’t live without?

You’ll also need to discuss your priorities for the near future. Does one of you want to start a business? Perhaps you want to start learning to drive? Or is building up savings important so that when you have a baby you can take the financial shock of potentially losing one source of income?

Commitments

A large part of this budgeting session will be the both of you listing the shared, important and unalterable outgoings you have as a household such as:

Rent

Utility bills

Groceries

Child care

Building/contents insurance

 

You’ll then need to be honest and open about the things that are individual to you. These can include:

Commuting costs

Clothing/cosmetics

Debt

Direct debits

 

The hard task is deciding how you will approach these personal aspects. If one of you has an ancient credit card debt of £5,000, should sole responsibility for paying it off come down to that person or will you do it together?

Debt is one of the most contentious aspects to a partnership. Interestingly, 30% of UK adults say they’ve been with a partner who they later found out was in serious debt, while 18% admitted that they had hidden their debt from their partner. Also, if you share a utility bill with your partner, or you have a joint bank account, you will be financially associated with them in the eyes of the credit referencing agencies - so if one of you has bad credit, it will negatively affect the others.

That’s why it’s so important to get on top of the debt that could push your dreams, such as a mortgage, further away from your reach. Find out how to check your credit score here.

Decide how to split the bills

As we’ve touched on - every couple is different. One married pair I know funnel both their salaries into one bank account and use that to pay for everything, including items personal to them (there is literally nowhere to hide in this case - any ASOS splurge will be visible to your partner). Other couples I know have joint bank accounts for utility bills while still holding separate accounts for their own things, while yet another couple does things completely separate with the husband paying the rent and the wife paying the utility bills and neither really knowing what the other is spending. 

There’s no one-size-fits-all when it comes to this arrangement. Maybe the person earning the most will want to pay a higher share of the total bills? Or will you go 50-50 regardless of your pay packets?

Either way, if you continue to use your own personal bank accounts for payments, a fantastic way of making sure that you’re both covering your fair share of bills is by getting technological and using an app. Splitwise has been around for a few years and is great for splitting bills, takeaways, IKEA binges and trips to the pub. It keeps a tab of who owes who what and then you can pay up via PayPal.

Cutting back and maximising your money

Another important aspect of this budget planning is to work out where savings can be made. Having a financial goal you’re both working towards will help to make those morning lattes seem totally pointless and dispensable.

You could try to establish a monthly limit on optional luxuries such as gym membership, hairdressing bills, tickets to sports events, restaurants and nights out.

In addition, research what savings can be made around your home with little effort, such as switching energy suppliers or going on a sim-only mobile deal. Read our Complete Guide to being Home-saving Savvy.

Don’t forget that those in a marriage or civil partnership can take advantage of the Marriage Allowance, potentially saving you up to £230 over the year. It only works if one of you earns less than £11,500, with that person transferring £1,150 of their Personal Tax Allowance to their partner.

Saving for future

Check out the latest savings and current accounts with the best interest rates. Currently, the Santander 123 account offers a monthly interest of 1.5% on your entire balance as well as cashback on selected household bills. The requirements of this account is that at least £500 is paid in per month.

Decide on how much you can feasibly transfer each month into a savings account and set a direct debit on payday to transfer it.

Top Takeaway

Identifying your common goals is one of the best way to get onto the same financial page in a relationship. It’ll make sacrificing luxuries bearable if you know that in a year’s time you’ll be those few steps closer to reaching that aim, whatever it is. Stay honest and transparent with your partner throughout, and make sure that you regularly revisit your budget to see how it’s going at least every few months.

Author bio: Thanks to a journalistic career history and a childhood at Sylvia Young Theatre School, Natasha has her fingers in a few professional pies, doing her best impression of a model and actor as well as personal finance writer. Outside of work she compulsively watches BBC period dramas and constantly lies to herself that this year will be the year she learns French, once and for all.

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