6 Tips for Simple and Successful Marital Finances

I think we can all agree that finances play a key role in our married lives. It’s the need to provide a quality life for our family that drives most of us to work, and we know that the way we spend our resources directly affects our lifestyle now and down the road.

Money stuff is important.
That is not to say that money is the center of life or that managing the family finances must be an oppressive burden. In fact, financial success is really just a matter of making good choices consistently.

The number 1 rule is to keep it simple.
These tips aren't earth-shattering and they're not original. In fact, it is the same advice we have heard from our grandmothers our entire lives. It’s not complicated, but it's effective.

6 Tips for Simple and Successful Marital Finances

1. Build a basic budget…together

The two key components of a meaningful family budget are: (1) to proactively plan ahead for how you will spend your money and (2) to create it with your spouse.

You and your spouse must create your budget together and you must agree to follow the same budget. When you take this approach, a budget can become a surprisingly valuable tool in your marriage. Real communication is needed to formulate a plan, and real trust is developed when you both stick to it out of respect for each other.

2. Work together from a single account

Do you and your spouse operate with separate bank accounts or a “yours, mine and ours” approach to your family finances? I would strongly encourage you to consider simplifying your life by consolidating everything into a single bank account. Not only will it be easier to keep track of, but you will benefit by shifting your mindset to one of unity with your money. As a bonus, you can expect that the openness and communication required to make a single account a success will carry over and enhance other aspects of your married life.

3. Eliminate your debt (very important)

None of us enjoy paying the car finance company or student loan office each month. In fact, I think we can all agree that it sucks to have your hard earned money spoken for before you even receive your salary. So, if we all hate the payments, why do so many families have them?

It’s a matter of mindset. If you are fed up with being normal (i.e., deeply in debt), you can shed the debt and achieve financial freedom. You set the priorities, and you make the decisions that will allow you to ditch the debt. My wife and I only have a mortgage as debt - our credit cards are paid off each month and we don't borrow a single penny for expenditure, and you know what? It's absolute bliss.

4. Stick with simple (and effective) investments

As a rule, if you don’t fully understand something, you should not invest in it. If you chase the latest hot trend and buy what everyone is recommending, you are almost assuring yourself of poor returns.

Instead, take a simple approach and focus your investing in areas with a long track record of success. Personally, I think it is tough to beat a diversified mix of mutual funds for retirement investing. They are not sexy or flashy. But they are very effective, low in cost and easy to understand. That’s a formula for long-term success. There are even no fee mutual funds on the market now that have given consistent and reliable returns - but don't forget to take advantage of your Share ISA to reduce your taxes.

5. Enjoy the simple things in life. Live within your means

At the end of the day, it really does come back to living on less than you make. I hope you make a lot of money and love what you do to earn it. However, the critical point here is that you really don’t need a ton of money to be financially successful.

The key is contentment. Quit placing your value in material things and trying to maintain a high-cost lifestyle. When you learn to appreciate your family and value the simple pleasures in life, your need to impress the neighbors really does start to fade.

6. Remember to pass it on

In my opinion, the best part of simplifying your financial life and finding contentment with your lifestyle is the impact it has on your relationship with your spouse and the example it sets for your kids. When you break the cycle of debt dependence and fights about money, you set the stage for financial success for generations to come. You literally have the ability to change the future shape of your family tree.

Were these suggestions brilliant, original and completely unexpected? Of course not. I’d venture to guess that you knew these things, but you may not be living them. The key is to take action.
Simplify your financial life and invite new success with your money and, most importantly, your marriage.