Money can either make or break a relationship. With each person bringing a different money personality to the table, it is even more crucial to be open and honest. Here are a few things to consider if you are a couple who are looking for ways to reach your money goals.
Not discussing finances can create problems later
The starting place for any money journey is to be open and honest about where you currently are. Most couples find it hard to discuss their finances with their partner, but this is a crucial step when it comes to wealth creation. According to Stats SA, money is the second biggest cause of divorce in South Africa after lack of communication. Both tend to go hand in hand. Furthermore, people are 10 times likely to split with a partner who is bad at managing their finances.
Understanding your money personality
Understanding your money personality can lead to fewer frustrations and help you find a financial plan that can work with each person's money personality. How we were raised shapes how we view money. Knowing your biggest financial fears and why your partner spends money as they do can lead to a more practical solution that will make your finances work for you.
How you can start creating wealth as a couple
It is crucial to speak to an accredited financial advisor who can help give you financial advice that will be tailored to your situation. Here are some ways in which couples can get started:
Start saving together. Having a budget and savings plan is crucial. Discussing an amount that you will realistically be able to put aside each month can come in handy in the future.
Both invest in life insurance. Life insurance is a financial product that can be beneficial for anyone that is trying to create wealth, especially when it comes to protecting the lifestyle needs of those you love. You can use our life insurance calculator to find out how much life insurance you will need.
Create an emergency fund. Establishing a fund to take care of what you consider as an emergency can protect your finances from taking a blow when these emergencies do arise. Make sure that you both discuss how much you plan on withdrawing from the fund and what you are using the money for.
Avoid making emotional financial decisions. Impulse purchases or making an investment when something emotionally significant has occurred on a day can undo any financial plan that is in place and easily push you into debt.
Track your finances. Be it small or large amounts of money, always keep track of where your money is going. Carefully check bank statements and keep tabs on what you spend daily. Wherever possible, cut back on things that you do not need.