Your wedding day is one of the most exciting and intimate days of your life but if you are not intentional with how you allocate money for that day, you might start your journey as newlyweds with regret.
They say money can’t buy happiness but talking about it especially when you are about to get hitched can go a long way. Before saying your ‘I dos’, there are a few money-related decisions you will have to make.
Here are five financial decisions that successful couples make before their wedding day.
Getting a loan for your wedding is a good way to bridge any financial gaps you may be having. However, if a loan fully pays for the wedding, you may spend years paying for that one day or it might take longer to clear that debt especially if student loans and other debts are also being brought into the marriage.
According to Motleyfool taking a loan for a wedding, a vacation, or anything that won’t tangibly make your life better in the long run is a bad idea. However, a mortgage loan to buy a house or a business loan to start up that small business you have been wanting to make a reality are examples of loans worth borrowing. Another reason borrowing money might be a bad idea is because you are starting a new phase in your life. Marriage is already difficult enough, adding a loan to it might not be a good idea.
Are you filled with financial anxiety about your big day? Here are three alternatives to getting wedding loans.
Having a small wedding might not fit the fairytale dream wedding you have in mind but the financial advantages are plenty. For starters, with fewer guests, you are instantly saving on venue costs, catering expenses, and transportation, leaving you with money you could spend elsewhere or lock up in savings.
If you are not willing to compromise your dream wedding that costs a specific amount, consider delaying the wedding until you can afford it. This period could give you and your spouse time to discuss financial issues and how you will reach your goal of saving the money needed.
It might sound strange, talking about making a budget for what’s supposed to be one of the greatest days of your life. However, having a wedding budget you can afford and sticking to it will help you keep track of your expenses, plan a wedding that’s within your realistic financial means, is a sure way to avoid overspending and can help you avoid conflicts with your spouse or family members. A wedding budget helps you with prioritising your expenses and making informed decisions on where to allocate your funds and resources.
A wedding budget outlines all the costs associated with planning a wedding. It typically includes costs such as the wedding ceremony, venue, catering, photography and videography, music, wedding attire, decor, and miscellaneous costs.
Read Also: 5 Good Financial Reasons to Delay a Marriage
The thought of leveraging your relationships ( friends, family, peers, and colleagues) may sound manipulative to you but it's not. Leveraging the resources at your disposal means making full use of every resource that’s available to you. When leveraging the resources at your disposal you have to do more with less.
For example, you could reach out to a former university roommate that now has a huge front yard that could serve as your wedding venue, if you were looking to have a garden wedding.
Another example is having a sibling with an excellent singing voice, and asking them to sing at your wedding.
If you haven’t had that money talk yet with your betrothed, it's time to consider having it. Having that conversation will help you get on the same page not only with how much you want to spend on the wedding but also open the door to other conversations like savings. It is also a chance to lay out your financial priorities and how you can move forward with them. Before you can achieve any goal, you have to both agree on what they are. Is it buying a home? Starting a family or becoming debt-free?
The decision of whether you want to join your finances or keep them completely separate is something that every couple must consider addressing. Some couples may choose to continue having separate accounts, others decide on having a joint account while others decide to take a hybrid approach with some combined accounts and some separate.
A joint account opens up a line of communication. It ensures there is accountability for how you spend money. It allows communication to happen between you and your partner regarding any financial issues that may arise.
Other benefits of having a joint account are:
Getting married allows you to consider making changes to your insurance. Whether you got your coverage through your job or on your own you can compare the cost of adding your better half to your insurance policy or keeping separate policies. Your employer may have better coverage than your partner’s for example but some charge more for dependents. Consider comparing your coverages before making any final decisions.
Getting married changes your life in profound ways. Marriage might seem to be all about love and companionship but it's much deeper than that, it's more than just an emotional commitment, it's also a legal and financial one. Whether you are getting married for the first time or remarrying after a death or divorce, it's good to consider sitting down with your partner well before the wedding to talk about these financial issues and also do some financial planning.
It may not be the most exciting premarital activity but the decisions you both make about how to deal with money will have a long-term effect not only on you as an individual but as a couple as well. Whether you decide to combine your finances completely or keep some things separate, the choices you make will not only have financial implications but also emotional and legal ones. Having these important conversations before the wedding may help you start your marriage on the right note with no surprises lying in wait. It will also set you up to have an ongoing conversation about your finances. Some preparation now will pay off handsomely later.