Best Investment Tips for Newly Married Couple
Two hearts come close together in front of hundreds of individuals during marriage. Friends wishes them to have joy and happiness in their married life. However, single word named ‘money’ can create a huge gap between husband and wife if they have poor money management skills. One cannot think of own way of managing money after marriage. Spouses can lie and over spend. However, if you can plan your money matters well, you can avoid any dispute with your spouse in the future. In this article, I would provide some important investment tips for newly married couple. What are the best investment tips for newlywed?
Is it difficult to manage spouse money matters?
These days it is difficult to manage own money itself. Managing spouse’s finances could be another biggest challenge. However, if you would know the inflow and outflow of cash, you can reduce expenses and effectively increase savings.
Also Read: Best Investment Plans to get regular income
Plan for your Honeymoon
Honeymoon is the holiday spent together by a newly married couple. Before you think of any investment planning, you should first proceed to your honeymoon. It is one of the memorable moments in life which cannot be replaced with money. There are several honeymoon packages from leading travel agencies like Makemytrip, Yatra, goibibo, coxandkings, Thomas cook, etc. They offer these packages at lower prices.
Best Investment Tips for newly married couple
1) Talk about money
This first step can be done before getting marriage or immediately after marriage / newlywed. One should discuss about money matters with their spouse. How much money they are earning, how much is being spent on regular expenses, EMI’s being paid every month and ultimately the savings being done every month. This would give a fair idea about the cash flow.
2) Create / modify the financial goals
The second step is creating the financial goals in consulting with the spouse. It could be accumulating funds for their dream home, children education, child marriage, retirement, etc. If any or both already created such goals, you can review and modify if required. One should consider short term goals like buying car, foreign vacation, etc., along with long term goals.
3) Build Emergency Fund
While you may plan your investments, there could be a situation where you may need money on an emergency basis. It could be due to job loss, unexpected medical expenses, home repairs, etc. One should be able to assess some amount as emergency fund making certain assumptions. E.g. Mr. Rajesh monthly expenses at Rs 50,000 including housing loan EMI’s. He can keep an emergency fund for 6 months, i.e. Rs 3 Lakhs. He can invest these funds in bank FD or liquid mutual funds or ultra short term mutual funds. There are several other ways to invest your emergency fund.
4) Take Term Insurance Plan
Life is full of uncertainty. One should take the term insurance plan of the earning spouse. If both are earning, term plan should be taken on both names. You can consider taking join term insurance plan based on the features of the plan. If you are thinking about how much term insurance plan you need to take it, you can refer this article. You can consider taking 10-12 years of yearly expenses as the sum assured in term insurance plan.
5) Create a Budget
Last week I met a newlywed couple. I asked about their budget. They smiled and said they are just married. Creating budgeting need not be done after 5 or 10 years of marriage. If you do early, you gain early. If you plan your budget in the early stages after your marriage, you would be more disciplined in spending, saving and investing.
Consider all incomes, including your spouse’s income, interest received from FD’s, rent, etc., This is your total inflow.
Take all household expenses, EMI for housing loan, etc. This is your total outflow
Inflow minus outflow would be your savings.
6) Tracking budget
I created a budget in my early stage after marriage. However, missed to track it many times. Tracking budget would help you know whether you are going in the right track in planning your finances. I realized it after a few years, but corrected myself.
7) Invest your savings to get higher returns
Based on your risk appetite and financial goals created, you can invest in various investment options. If you are a high risk investor, investing in blue chip stocks could be a good option. If you are moderate risk to high risk taker, investing in top large cap mutual funds could be a nice idea. If you are low risk to the moderate risk taker, investing in balanced mutual funds and bank FD’s could be a right option for you.
8) Clear out your debts first
While taking a home loan or personal loan could be necessary sometimes. If possible, clear them out on first priority. Interest on such loans could eat away your savings.
Finally, all the best for newly married couples!!!
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Best Investment Tips for newly married couple