Couples and Cents

One of the most important things you can do in your personal financial life is to track your spending. Most people have no idea where there money goes each month. And if you don’t know where it goes, then you can’t get control of your spending.

Fortunately, its easier than ever to keep track of your spending. I find that the best way to do this is to invest $30-$40 in personal finance software like Quicken or Microsoft Money. Its easier than ever to use, and you can categories every transaction you make. In fact, much of this can be done automatically, saving you hours of time. You can easily set up these programs to automatically download all of your latest transactions when you log on. Then, you simply review each transaction and assign a category. If you have a reoccurring transaction such as a trip to your favorite grocery store, the software will automatically remember the appropriate category (groceries, dining out, gas).

After a few weeks, you’ll have a much better idea of where your money is going each month, and you will probably be surprised. My wife and I were able to cut our food budget in half after we realized how much we spent each month on groceries and dining out. Its an important step in getting control of your financial life.

If you are interested in starting a small business with your spouse, you will want to take some practical steps to ensure that all goes smoothly. There are a number of advantages of having your spouse as a business partner. You already probably have great chemistry, which is why you are married to begin with. You also probably trust your spouse more than any other person. But, it is important to follow a few ground rules to make sure that your business venture doesn’t threaten your marriage.

Here are some tips:

1. Set some ground rules - don’t let the business consume your marriage. This may include a weekly date night.
2. Maintain at least one income and try and keep expenses down in the beginning.
3. Don’t forget to save for retirement.
4. Draft a buy-sell agreement - This is a tough one because no one plans to fail, but its an important document to have. Remember, most new businesses fail within a few years.

Couples in business: Protect your finances and your marriage - Jan. 31, 2008

The House of Representatives has approved a $1,200 credit for couples as part of an overall economic stimulus plan meant to boost the economy.  The Senate will most likely vote on the next week. Although the bill is expected to pass, an altered bill in the Senate could derail the process……..so don’t spend the money in advance.

Checks  may go out to qualified people as early as May. Take the next couple of months and research some ways that you could invest the money. If you don’t already have an IRA, this money would work well as an initial investment in an IRA. Although the bill is designed to boost economic spending, I would look at this $1,200 credit as a great way to boost your family savings.

House Approves Economic Stimulus Plan - New York Times

Here are a few reoccurring financial mistakes for couples to look out for and some tips for how to handle them.

1. Separate accounts - This may be a matter of personal preference, but I find that it is easier to keep everything in the same account and simply set up budgets so that each person has a flexible spending account. If you can’t stick to a budget, set up a separate spending account for each spouse and fund it monthly.
2. Debt - Avoid it as much as possible and quickly take care of any credit card debts that are brought into the marriage.
3. Spending decisions - Again, use a budget. If I want something thats more expensive than my budget allows, I try and find and alternate way of earning some extra cash for that expense. Try to avoid credit card splurges and save up for major household purchases.
4. Openness - Try using a software program like Quicken or Microsoft Money and keep track of all of your finances. That way you both know where you are at all times. Don’t keep anything secret.

The Six Financial Mistakes Couples Make (Marriage & Divorce: Personal Finance) | SmartMoney.com

It may not be romantic, but talking about money is one of the most important things that you can do for your marriage. Money is the root of many problems in a marriage, and it is important for spouses to develop a strong financial foundation from the beginning. Elizabeth and Robert Brokamp of the publication Motley Fool created a financial manifesto to lay the ground rules for finance in their family. They found success through the following rules:

1. Prioritize
2. Track your expenses
3. Don’t overspend on food
4. Shop Smart
5. Talk money once a month

Out of all of these, I believe that communication is the most important. Make it a priority to discuss finances on a regular basis and keep everything out in the open.