Creating a budget with your spouse or significant other can be a challenge. Many people procrastinate through this process. And if you’re able to create one, the next challenge is sticking to the budget as a couple. In this article, we share with you tips on how to stick to a budget as a couple.
If you are a couple who have created a budget before but never been able to stick to it, you’re not alone. Sticking to a budget as a couple requires discipline and dedication. With finances being one of the most crucial areas in any marriage or relationship, a budget can be a good tool for managing expectations. The sooner you start treating each other as a team, the easier it becomes to create and stick to a budget.
Work as a Team
One of the best approaches to adopt if you want to stick to your budget is to combine all your income and expenses. This requires certain levels of trust. This approach will make it easy to make upfront calculations when creating the budget. There is no need to split your income and expenses if you’re creating a common budget for the household.
Some accounting principles can be useful when creating a budget with combined incomes and expenses. For example, each of your incomes, although combined, can be clearly marked as income from a specific spouse. Couples will be able to tell the proportion of each partner’s income that goes into the household’s budget.
Combining your incomes and expenses gives you a sense of shared responsibility. Shared responsibility gives you motivation to work as a team, and it’s easy to stick to the budget if each of you treats the other as a team member.
Separating Expenses
Let’s be honest, not all couples would be willing to share their income and expenses. However, this does not necessarily mean that you’re not on good terms, just differences in principles of money management. It makes sense to separate your expenses in such situations if it will make it easier to stick to the budget.
Sometimes, the best way of how to stick to a budget as a couple is to set specific agreeable boundaries. You can separate your expenses into two groups – ‘yours’ and ‘theirs’. For example, one of you could be paying the mortgage while the other is handling regular house expenses. In addition, individual expenses like car payments and personal debts are paid separately. If your partner doesn’t agree that your personal auto insurance should be a shared expense, you should cover it as a separate personal expense.
Couples can agree on proportionate budget allocation for each of the parties. For example, one can have 70% percent of their income going to the budget while the other allocates 40% of their income. The proportions are based on several factors, such as the amount of income for each partner and the number of responsibilities that are specifically allocated to each partner.
One of the benefits of separating expenses is that it gives you a certain degree of autonomy. This approach is ideal for couples who enter into a relationship with different financial preferences and habits.
Make Your Finances an Open Book
We have already covered two important approaches you can adapt – combining your income and expenses or separating them. One of the reasons why some couples may prefer the separation approach is because they think their partner is not open about their finances.
If you want to budget together as a couple, it’s important that both of you are open about your finances. All budgeting decisions should be based on the current financial status of both partners. Let your partner know about your credit history, title loans, money goals, debts, and more. This sets a foundation of trust for building a unified budget for the family.
Whether or not you’re sharing your income and expenses, you should create a joint budget. There is no better way of how to stick to a budget as a couple than having a unified budget. If each of you has their own separate budget, then it means sticking to your budget as an individual, not as a couple.
Do Not Spend More Than Your Income
This may sound cliche, but spending less than your income is the surest way of growing your savings. The whole purpose of creating a budget is to ensure that you live within your means and are able to make savings for future essential expenses and investments. Therefore, sticking to these basic principles is one of the secrets of how to stick to a budget as a couple.
Spending more than what you have has various implications. For example, you may end up in debt. You may need to declare bankruptcy to save yourself from specific situations. A bankruptcy lawyer comes in handy in such situations. If possible, avoid these situations because they can be vicious cycles that will stagnate your growth as a family.
The whole idea behind sticking to a budget is to ensure that you don’t spend more than your income. If you stick to the budget and you still spend more than your income, then it means that your expenses exceed your income in the budget. Ideally, your income should be more than your expenses. Some couples prefer to create a zero-based budget where each expense should be justified for each new period.
Generate Common Financial Goals
Your long-term goals as a couple need to be conjoined, regardless of whether you’re combining your income and expenses or not. For example, you can both agree that you’re setting aside a specific amount of money each month for your kids’ college education in the future. Separate goals may bring conflicts in the family.
Both of you should determine which goals should come first. For example, between buying a house and having kids, which one should come first? Should you take a life insurance policy or not? Partners who want to know how to stick to a budget as a couple must also learn about setting their priorities right. One of the best approaches to setting your goals is through the SMART goals approach. The goals should be specific, measurable, achievable, realistic, and time-based.
Address Personal Needs
Although you’re creating the budget as a couple, each of your needs should be met. This is the only way you’ll be motivated to stick to the budget. Therefore, when setting goals, ensure that each of the partner’s needs are accommodated. A discussion should be held to ensure personal needs do not collide with the family’s or couple’s joint needs.
Personal needs include clothing expenses, salon expenses, and gym membership. It’s up to you as a family to decide whether these personal needs will be met jointly as a couple or separately.
You can motivate each other to be committed to the budget by ensuring each one gets some wins in the budget. If only one partner is getting wins, the other one may not stick to the budget. A good example of a win is each of you getting a certain amount of money to spend as you wish.
Use Budgeting Software
Take advantage of technology to keep track of your spending. Partners who want to learn how to stick to a budget as a couple should share access to the budgeting software so that each can track spending and income.
While there is a lot of budgeting software out there, there are some specifically created for couples. These are the budgeting software you should use because they have unique features created for couples.
The app is only supposed to help you keep records and automate some actions. However, both of you should make the key decisions, such as the specific amount of your income that should go into the budget. If you have a family business, the app is not going to automatically find out about it and suggest you take commercial insurance. You have to feed the app what you want it to act on.
An additional benefit of a budgeting app is that it makes it possible for the budget to be in a central location where all concerned parties can access it. By concerned parties, we mean the couple or partners, and not your tax lawyer. Both of you can access the budget on your mobile phone.
Share Budget Responsibilities
There is no better way of how to stick to a budget as a couple than being committed to the budget. Budgeting responsibilities can be shared and ensure that each party is committed to fulfilling their responsibilities. Some essential budgeting responsibilities include refilling the budgeting envelopes, bank account checks, calculating leftovers and leaks, and negotiating specific bills down.
Sharing responsibilities ensures that none of you is burdened with the many activities that come with ensuring all your budgeting goals are met. For example, while one person is responsible for dealing with property managers and keeping track of your rental income, the other party can calculate budget leaks and leftovers.
Some activities can be time-consuming or entail lengthy processes. In addition, having one person to deal with the specific responsibility makes it easy to follow up. For example, if you’re doing something that needs email correspondence, then only one of your emails should be used. If you’re scouting for the best home insurance services, you can assign this responsibility to one of you.
Consider Your Collective Money Values
It doesn’t mean that, because you have common hobbies, you’re going to have the same money values. One of you could be a spendthrift while the other has been living a frugal life. These are conflicting money values that need to be considered when creating a budget.
Examples of money values that you need to consider before creating a budget include tithing, charitable giving, extreme frugality, avoiding debts, using debts as a tool, saving for vacations, paying for vacations as you go, quality over quantity, and valuing people over things. Getting the tricks on how to stick to a budget as a couple means discussing these money values and deciding on what will be compromised.
Your common money values should be incorporated into the budget. You should be able to reach a compromise on conflicting money values. For example, if you value saving for the future but your partner prefers living in the now, both of your money values can be accommodated to a specific degree. For example, you can agree on a specific savings percentage on the budget, while also setting aside some money for fun. While you save for the fun category and not pay for it on the go, both of your money values are accommodated. When both of your money values are met, whether wholly or partially, you’ll be motivated to stick to the budget.
Have a Weekly Money Date
Money issues can be sensitive, but they don’t have to be if you have common objectives. Make the whole budgeting process fun. This means setting aside some money for leisure, such as traveling or dates. Because these activities are in the budget, you’ll not feel guilty indulging in them.
One of the best ways of how to stick to a budget as a couple is keeping communication open and ongoing. You can have a date once a week where you evaluate your budget and discuss your needs. This is when you discuss with your partner something new you want added to the budget. Need an additional income and you think you can dispose of your old vehicle through cash for cars platforms? The weekly money date is the best time to have a discussion about this. The weekly money date is also the ideal time to discuss your next budget – the following month.
Couples who want to manage their finances properly must learn how to stick to a budget as a couple. You can only stick to a budget if it meets your needs. Therefore, it’s important that the budget considers the needs of all parties. These needs, however, must align with the long term goals of the budget.
A budget is a useful tool that you can use to track your expenses. In addition, it can help you make projections. However, if you don’t stick to the budget, you’ll not achieve your financial goals as a couple.
