Remember when you spoke those words at your wedding? Perhaps it was in front of family and friends. Or maybe it was just the two of you on a beach or in front of a justice of the peace.
Do you recall the tears streaming down your face as you looked into your partner's eyes, knowing that this was the person you'd committed to spend the rest of your life with, until death you do part?
At that moment, you probably weren't thinking about savings and checking accounts, stocks and other investments or credit scores. You were thinking, "This is the happiest day of my life."
Well, not so fast.
While being married has put you in a state of bliss, you need to come down off of your cloud for a minute and have a conversation with your partner about finances. In fact, I'd love to help you and your partner secure a solid and happy financial future together, now and forever. Just follow these tips.
How to Say "I Do" to a Solid Financial Future Together
1. Review bank accounts, credit scores and credit card statements.
Gather your bank statements, credit scores and credit card statements and compare notes. How much money do the both of you have? What are your credit scores? What are your credit card balances? Review all of this information. And if one of you has a lower credit score than the other, it's a good idea to create a plan to raise the credit score. How? First, stop using your credit cards! Second, double your monthly payments, if you can. It's important that you and your partner are on the same page when it comes to finances.
2. Create a monthly budget, and stick to it.
Creating a budget is super easy. You can either grab a pen and paper or use a software program. You'll want to include the following:
After you've created your budget, review it together and make necessary adjustments. See where you can cut back. If you can't adjust the figures, make sure you stick to your monthly budget, no matter what.
3. Review investment portfolios monthly.
If you have investment portfolios, sit down with your financial advisor/manager and discuss how you can make changes to increase your investments and/or diversify. For example, if you've been playing it safe, you may want to look into more aggressive stocks. On the flip side, if you've been too aggressive, you may want to rethink your strategy and be more conservative. Your financial manager will help you choose the best investment options.
4. Compare salaries and know when to ask for a raise.
How much do you make? If you've been working your way up the company ladder and earn a healthy salary, congratulations! But if you've been working and haven't received a raise or don't think you've received a raise that is worthy of you and your work, you may want to approach your boss and ask for a raise. While this may scare you, it can be done -- the right way. Do not be confrontational. Point out your contributions and market value. If your boss pushes back, gently remind him/her of your results. If the answer is "No," either accept it or look for another job.
5. Choose a monthly amount to deposit into a separate savings account.
Now, more than ever, it is important to have an emergency fund. Why? Because you don't know what could happen now or in the future. You or your partner could get laid off from work, permanently lose your job, need to take care of an aging parent or sick child, or experience another life-altering event. Establishing a monthly amount to be deposited into a savings account that is not to be touched is a must. You may not want to do it, but you need to do this, now.
6. Live within your means.
Your mom and dad may have told you to live within your means. Did you listen? If not, it's time to start listening. Whenever you're about to purchase something, ask, "Do I need or want this?" If you don't need (fill in the blank), why do you want it? Make sure you have a good answer. If you don't need (fill in the blank), don't buy it. Why? Because you may have buyer's remorse or you could find a better deal at another store or online; keep your options open.
7. Start investing.
If you don't have an investment portfolio, you and your partner may want to hire a financial advisor. It's never too late to invest. Here's a tip: Go through your home and look at the products you bought. Find the company and/or brand name and conduct an online search to see if they're on the NYSE or NASDAQ. Research, i.e. has the stock gone up or down? Ask your financial advisor about the fluidity (money flows, hardly any debt) of the companies. If the companies are solid, consider purchasing their stock. You may want to look into real estate investing. However, you must be ready and prepared to be a landlord. You may consider "fixing and flipping" homes, but this takes some skill. Plus, when you start tearing down walls, you may find problems like faulty electrical work that you didn't anticipate. Consult a professional real estate investor before you buy an investment property. But whatever you do, start investing, now.
8. Get a side job or start a business.
Okay, so you and your partner work 40 or more hours per week and may not have time for a side job. However, you can earn extra money doing what you love. For example, do you like to bake? Consider opening an online cupcake business. You could specialize in gluten-free and vegan cupcakes or offer customers specific cupcakes, e.g. red velvet and chocolate. Maybe your partner is a fantastic artist. He/she could create paintings and sell them online. You may find that both you and your partner have a knack for running your own business. You could eventually quit your day jobs.
9. Sell your stuff.
Now that you're married, go through all of your stuff and get rid of what you haven't used in a year or more. Toss out anything that is worn out, but sell everything that is gently used. Why? Because you can earn extra money and deposit it into your emergency savings account; every little bit helps.
10. Keep the lines of communication open.
Most important is to keep communicating with one another. Do not shut down if your partner makes a mistake, i.e. charges a pair of $500 shoes. Sure, you may not be happy about it, but it's not the end of the world. Calmly speak about the importance of creating a solid financial future together. If you need help, seek counseling from a marriage or financial counselor or both. Whatever you do, do not throw your marriage away at the first bump you have. It won't be 100 percent perfect all of the time. And remember: Sometimes, marriage isn't like a merry-go-round; it's more like a roller coaster. And if you think about it, what's more fun? A ride that goes around and around or one that's filled with thrills and chills?
To secure a solid financial future, you and your partner need to be willing to be honest about finances and hopefully were on the same page before you got married.
If you save $100, a month that's $1,200 a year plus some interest; multiply that by two years and that's $2,400 with some interest. After a few years, you could take some of the money, invest it and triple, maybe even quadruple your investment. Your financial manager can assist you with this.
Having a solid financial future together is closer to possible than you think.
Car dealerships are one place where price negotiations are expected. While sales staff like to focus on monthly payments, it's smarter to negotiate the overall price, <a href="http://moneyland.time.com/2012/08/13/12-things-you-should-always-haggle-over/#1-cars" target="_hplink">according to <em>Time</em></a>. If you're buying a used car, always be sure to look up the vehicle's actual Blue Book value. Have the car inspected and haggle for a lower price if it needs servicing.
The <a href="http://www.ftc.gov/bcp/edu/pubs/consumer/homes/rea09.shtm" target="_hplink">FTC advises consumers</a> to shop around and negotiate all mortgage rates and fees, and doing so can save thousands of dollars. Those with good credit scores can often negotiate for a lower APR, while everyone should discuss lowering or eliminating certain <a href="http://www.lender411.com/five-mortgage-closing-costs-you-can-negotiate-lower/" target="_hplink">closing fees</a> and processing charges.
Monthly rent rates are totally negotiable, especially when you're renewing a lease. "If you pay on time every month, it'll be worth it for your landlord to offer you a better rate than to take a gamble with a new tenant," says HuffPost Money Editor Emily Cohn.
Customers often get caught by surprise when their monthly service charges skyrocket due to expired promotional rates. "Generally, keep track of what competitors are currently charging new customers, and indicate to your current provider that you are considering switching. Tell them the deal you saw, and ask them to match or beat," Edgar Dworsky, founder of ConsumerWorld.org <a href="http://moneyland.time.com/2012/08/13/12-things-you-should-always-haggle-over/#11-phone-tv-and-internet-service" target="_hplink">told <em>Time</em></a>.
While not everyone is capable of haggling for a lower interest rate, you may have luck negotiating out of penalty fees, especially if you're generally a good customer. If you're looking into opening a new card, be sure to <a href="http://www.investopedia.com/financial-edge/0711/7-Fees-That-You-Should-Always-Negotiate.aspx#axzz24lTQxmHG" target="_hplink">mention competitors' offers and rates</a> to the company representative.
Customers can often negotiate the elimination of annual fees or registration costs when beginning or renewing memberships. Often, the <a href="http://moneyland.time.com/2012/08/13/12-things-you-should-always-haggle-over/#12-subscriptions-and-memberships" target="_hplink">threat that you may take your business elsewhere</a> is enough to bend a customer-service rep into giving you a deal, according to <em>Time</em>.
With the home <a href="http://www.huffingtonpost.com/2012/07/06/june-jobs-report-unemployment-rate_n_1653579.html" target="_hplink">construction industry still struggling</a>, maintenance workers are more willing to negotiate prices for services. Discuss <a href="http://finance.yahoo.com/news/pf_article_111978.html" target="_hplink">opting for lower-cost materials</a> and discounts on labor, advises Yahoo Finance.
Be sure to inspect clothes off the rack before bringing them to the checkout counter. If you find a pull or a small stain, pointing it out to a salesperson might snag you a discount on the item.
If you're going to haggle on anything, it should be on used goods. You should take the price tag at a garage sale or antique shop as a suggestion.
Much like credit card companies, travel sites compete with each other for customers, so make sure to shop around before booking a vacation. If you're using a travel agent, don't be afraid to reference deals you find online. If a travel site or agent won't <a href="http://moneyland.time.com/2012/08/13/12-things-you-should-always-haggle-over/#8-vacation-lodging" target="_hplink">budge on the per-night rate</a>, they may offer a deal on transportation or throw in a perk, like a spa service.
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