Financial Bliss - Marriage & Entrepreneurship

A few months ago, I attended the wedding of one of my closest friends. It was a stunning afternoon affair in the middle of a beautiful garden, filled with smiles and laughter. The wedding bordered on perfection, perfect gown, perfect cake, love that was literally bursting out at the seams and a Bajan reception of fun, frolic and wuk-ups till morning. It was wonderful to be able to share in their special moment, but not long after the honeymoon they got into their first fight attempting to iron out the finances, a difficult and sometimes scary topic for new couples & entrepreneurs to broach.

Money is often a tumultuous issue for us as individuals, and moving forward as a couple to share past debts or to incur new debt for varying goals & for a business, would be complicated to say the least. In fact, studies list money as the number one issue that couples argue about, and the number one issue that they split-up over.

The truth is, couples are expected to argue, about many things, including money! The key, is how you argue, what you communicate and what is resolved as a result. Both couples and businesses have ups and downs and a sound plan at home can bring comfort to a family ifyour small business or partner is struggling.

Communicate From The Get-Go:

In any strong businesses or relationship, good communication is key. It may seem obvious, but many couples neglect to ask their partners the simple questions early on which would alert them to the challenges which may lie ahead.

• Have you finished paying for your MBA?

• What is the monthly payment of your vehicle?

• Do you have other outstanding loans?

• What Debts will the business incur?

• Essentially… how much debt do you have?

• What will we be bringing to the relationship or taking to the business?

These topics, which may make others feel uneasy, are often important to financial growth.

Start by making an ordered list of all the debts previously incurred as well as those you expect to incur, from there discussion on interest rates and monthly payments as well as varying methods of debt reduction will go a long way.

Avoid Keeping Financial Secrets:

Along with sharing debt information, share expected salary and savings figures and converse on any other assets which you may have or need for the business. Maintaining complete honesty will help strengthen the relationship in the long run.

Determine How To Merge Two Financial Affairs:

One of the first hurdles couples often tackle is whether to combine monthly earnings, or keep accounts separate (while sharing household expenses and bills). While the latter gives couples some freedom to spend, no one option is considered wrong or right.

Couples are urged to try both ways to simply see which suits them best. However, any approach chosen will still take persistence,patience and practice to get it right.

Deal With Premarital Debt Together:

Experts indicate that more than 50% of men and women have some debt - vehicle, student, business, credit cards - before they wed.

When only one partner enters the relationship with large debts, waiting on its reduction can sometimes delay plans for homes and even children and though individual debt is not necessarily instantly shared upon marriage, undertaking the challenge as a unit can positively impact overall marital stability.

Discuss your Financial goals:

• Simply put, what are the family’s & business long and short term goals?

• Expansion? Debt reduction? Homeownership? Early Retirement?

These should be set together. It’s easier to work towards a common goal when some mutual agreement was made. On average, no matter the goal, financial planners suggest that families should not seek to incur debt in excess of 40%-50% of combined monthly earnings. Instead attempt to avoid this situation or, if this limit has been exceeded, place emphasis on paying bills with the highest interest rates and fees first. It is interesting to note that reducing debt can also help to reinforce relationships. Researchers indicate that paying off large bills together can provide new couples with feelings of accomplishment that are often important to their growth.

Set A Family Budget:

Growing together and learning something new each day is fantastic, but this is not the way couples should learn about each other’s spending habits.

Marriage finances should be likened to the finances of the new company, with plans, goals and budgets. Calculate combined income then subtract expenses – monthly debts, living expenses (groceries and utilities), rainy day money, savings, date night money and for couples who pool their finances, personal allowance. Although an allowance may sound juvenile, it provides autonomy over individual pocket money and can help prevent resentment…resenting her for buying yet another pair of shoes or resenting him for impulse buying that fancy divers watch even though he can’t swim.

Don’t Neglect Your Savings:

Couples & Entrepreneurs can sometimes find saving hard to do, but it is particularly important even in tough economic times.

Aim for 3 to 6 months’ worth of household expenses in the bank in case of unforeseen circumstances such as reduced business cash flow, job cuts, illness, car troubles and accidents. In addition to this, an attempt to aim for 5%-10% of gross salary per month to be automatically deducted for storage in a separate savings account.

Saving just $500 a month can earn over $6000 by year end and saving $835 per month can earn over $10,000. Set any goal and just try, getting into the habit of saving early in the relationship, is vital to the pattern in future.

Life Insurance & Wills:

Though we all hope, and don’t ever want to think of the unspeakable happening to our other half, life happens and families should also discuss issues like Wills and life insurance.

Be sure to list your spouse as the beneficiary on all documents for comfort in knowing that kids, spouse and final expenses (tallying in the thousands) will not put your family under undue financial pressure. Be sure that any insurance coverage is adequate and covers all of the basics.

In the long run, effective communication is key, being honest and open about financial responsibilities, goals and concerns, will allow your relationship to move forward and grow. Not only towards marital bliss, but towards the equally rewarding state of sound saving, security and financial bliss.

See more at https://issuu.com/caribbeandreams/docs/evolving_business_3_-_2019/