Money affects a relationship more than anything else. A study by the National Centre for Biotechnology Information (NCBI) on leading causes of divorce shows that 36.1% of couples cited money issues as the cause of their divorce.
Marriage and children come with their own financial responsibilities and learning to manage your finances as a family should be a priority.
Below are some tips to manage your family finances:
- Manage your debts – be honest with each other and declare all your debts. Know your cumulative debt, who you owe and due dates. Discuss repayment plans and minimize debts as much as you can.
- Have a joint account – having a joint account simplifies your financial planning, it makes budgeting with your partner easier – you can save towards common goals and pay for household expenses from a single account.
- Create an emergency fund – regardless of how much you earn, save for rainy days. Your emergency fund should be able to cater for your 3-6 months’ expenses. Increase your emergency funds as your family grows.
- Investments – Savings is not enough. Invest in stocks, real estate, mutual funds, bonds, etc. Invest in a business that will give your family an additional source of income. Most importantly, invest in your children’s education.
- Insure your assets and life – don’t allow death or illness to cripple your finances. Transfer that risk to an insurance company. Secure the future of your children by getting them educational policies. Health is expensive, get your family on health insurance. Insure your properties. Insure anything that matters to you!
- Create a family budget – have a financial plan for the family. Plan for your monthly, quarterly, half-yearly, and yearly expenses such as projects, fees, rent, savings goals, debt repayments, etc. Review your budget from time to time.
- Audit each other – Have money meetings occasionally. Hold each member of the family accountable for bad financial decisions and reward financial discipline. Track your expenses and avoid bad spending habits.
- Involve your children – Having children will most likely change your financial plans, get them involved in planning your family finances and teach them money management so they appreciate the value of money.
Financial security is crucial for a happy home and marriage. Treat your family as a business, get everyone involved in the financials, let them understand what you’re trying to achieve and how they can individually contribute to achieving it.
