“Can we afford this?”

One question that is a good one to ask when both people know the answer already, and it is a bad one to ask if one or both people do not.  Money is a dangerous tool when handled incorrectly by a relationship, and this will not be the last time I talk about it on this blog.

Money for Marriage Rule #1: Goals

Setting long-term goals for your family in other areas should point at your money goals.  My wife and I want to have children someday soon for example, so we set a series of goals that we need to meet for this to be a reality.

1. I need to be making enough money that we can live off my income alone:  In the meantime my wife is working as well to speed up our debt reduction, but to be better parents we feel that one of us should stay home.
2. Our higher-interest debts need to be paid off- Everything but student loans more or less.
3. We need a house- The plan is to settle shortly after rules 1 and 2 are accomplished.
4. We need insurance- For associated Doctors’ bills etc. My new job should be able to provide this.

These goals lead us directly to rule number 2:

Money for Marriage rule #2: Plan

Plan out how to meet your goals, and use your goals to guide your decisions.  Maybe a new outfit would impress our family, but putting that $50 in the house fund instead would allow us a nicer home in the future. 

The real key is developing steps to reach the big goals, and give yourself a small reward for each step met.  For example, when we have our high-interest debt paid off, we’re going to use the next month’s payment to spend two nights in a hotel and go out to dinner to celebrate.  These things are more fun when they are few and far between, and represent an achievement.

So to summarize:

1. Break your big goals up into small steps.
2. Set appropriate rewards for the small steps and a big reward for the large goals.
3. Make decisions with your goals in mind.
4. Always allow room for change.

Remember, plans are not a prediction of the future, and things will interfere with them, be flexible enough to change them when necessary.

Money for Marriage Rule #3 Budget

A budget is a plan for spending your money, and people will spend hundreds of dollars on software etc. to help them do this.  The reality is that it is very easy to budget.  Develop a system that you and your spouse can agree on and both use, and you will be doing better than most Americans.  (You will be happier too because Money won’t be a divisive force in your marriage).

Money for Marriage Rule #4 Commit

Sell out to your plan, just like you sell out to your spouse.  These plans, like your marriage, should be until death do you part.