How Can Newly Weds Prevent Debt
When a couple gets engaged, it is not uncommon to spend months or even years planning for the wedding. Once they are wed, they start planning for children. Unfortunately, financial planning is usually overlooked and as a result, many newlyweds find themselves unprepared when faced with new financial decisions. The results can be overwhelming and may include adding large amounts of debt and staring patterns of spending behavior that is bound to cause problems down the road. Developing a good financial plan early in their marriage can prevent debt.
Here are some tips for newlyweds. Don't wait until you are married. Engagement is the perfect time to begin making financial decisions. Developing a plan gives couples the ability to start saving immediately following the wedding. Be sure to compromise since couples that are out of sync financially is a sure recipe for disaster. Discuss and agree on retirement goals for vacations, cars, housing, and savings. Make sure to follow a budget as nothing prevents debt more effectively than spending within your means or below and be sure to hold each other accountable for spending behavior.
A very common financial mistake for newlyweds is overspending on housing. Be sure to stay within the amount that your budget this includes those planning to purchase a house as this may often be less than your pre-approved mortgage amount. Overspending on housing often results in use of credit and subsequently created excessive debt. Prepare a plan for a debt free retirement, even though this is decades away. The sooner a couple begins to save, the more powerful are the affects of compound interest.
For newlyweds, It is much easier to establish good patterns of financial behavior when they starting out so that bad habits are not created. The engagement period and right after the wedding is the perfect time for couples to begin making decision about their financial futures. Good planning in their initial years of marriage will allow them to bypass financial disagreements and excessive debts and set the stage for worry free retirement.