Wednesday, April 29
Money management in a relationship
So, clear up the cash at the very beginning, and you can stop all of those arguments before they escalate out of control and build a prosperous future. Here's how...
Pay off the wedding expenses as soon as possible. The longer the debt lingers, the more it prevents you from accomplishing what you really want. Interest rates are increasing, so any debt you are carrying is likely to start costing more. Look at all the other debts you have as a couple and develop a plan for paying it off.
Develop a bill-paying system that works for you. It doesn't really matter whether you both agree to put all of your bills into the same shoebox, or use the latest in Internet banking, as long as you have a system that keeps you paying everything on time. Couples who are sharing their finances for the first time often wind up paying bills late just because they haven't got organized and that will affect their credit reports and scores.
Focus on your credit reputation. You'll both need good credit scores to buy that first family car or house. If one of you has a clean credit history and the other doesn't, keep those credit cards separate, says Dvorkin. The person who already has a good credit score can help the spouse build a better credit history by encouraging him or her to start with a secured credit card and then getting a regular credit card and making timely payments. Adding the "bad credit" spouse to the "good credit" spouse's cards won't help rebuild the weak credit score, but could hurt the good score.
Keep some checking accounts separate too. If you're both used to earning and spending your own money and have decided to kick in together for family finances, keep three checking accounts. One for each spouse and the household account, to which they both send money to cover shared expenses.
Updated By Udit Mathur at 5:08 PM
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