By Daniel Rodriguez | Dr. Budgets
Being in the honeymoon stage after getting married is an exciting time! You’ve just committed to your partner and are starting your lives together. This new life together might mean moving in together, figuring out how to pay for your wedding debt, taking on new joint expenses, or preparing for some big expenses in the near future (buying a house, having a baby, etc.). This may lead to some stress around money. I enjoy working with lots of couples, so I thought I would share these 5 things you must do after getting married to help ease the stress of mixing marriage with money:
1) Combine to Save. Marriage has several financial advantages, especially when combining certain expenses. One big one that I have seen with clients (and in my own life!) is health insurance. If the person you are marrying works for a company with a great health insurance plan, then you could save hundreds, if not thousands, of dollars per year. After you get married, make sure your spouse adds you to their health insurance plan so you can reap those benefits. Often, there is a short window (30 days) to do this, so make it a priority after getting back from your honeymoon. Another area where you can save is auto and home/renter’s insurance. There is often significant monthly savings when you are both on the same auto insurance policy. And while you are at it, you can bundle your auto and home/renter’s insurance policy to save even more! Talk to your insurance professional after you get married (or even before if you live together before marriage) to determine if you can save some money on your insurance. There are many other areas where you could combine to save, for example, combining your cell phone plans, Netflix accounts, Costco memberships, or Amazon Prime memberships, so take a look at your particular situation to eliminate any overlap you have in your expenses.
2) Plan to Pay Off Debt. A survey of 1,010 randomly sampled newlywed couples found that entering marriage with consumer debt has a negative impact on newlywed levels of marital quality. The study also found that the large majority (70%) of newlyweds in this study brought debt into their marriage relationship. So, does this mean you should wait until you have no consumer debt to get married? Of course not! But you should come up with a plan to pay off that debt together as soon as you get married. And once you have that plan, stick to it! I have seen the huge impact that debt has on couples and their relationship, and I’ll tell you this: the couples who pay off their consumer debt seem happier. So, come up with a debt repayment plan together after you get married, and then say goodbye to consumer debt for good!
3) Merge Your Finances. There is no right or wrong answer on whether to merge your finances after marriage or not – every couple is different (for more on this topic, read Merging Your Finances After Marriage). The key is to have an open and honest conversation about money and your financial goals so that you can then work together to achieve those goals. When it comes to merging finances, I usually suggest using a joint account as the central account for a couple, which means all the income flows into that account and then common expenses are paid out of that account (mortgage/rent, utilities, auto expenses, groceries, insurance, etc.). But also…
4) Separate Your Finances. So, once you have a joint account as the central account for income and expenses, then I like to create separate accounts for each person which gets funded every week, two weeks, month (whatever works best for the couple) with their allocated “allowance” that they can spend on whatever they want. This allows each person to have some “fun” money without having to consult with the other person. In my marriage, we do this, and it is nice to be able to buy a gift for my wife from my personal account… it feels more like a gift from me when I’m using my “own money” for that. Here, again, you should have open and honest communication about what is a fair amount for each person to receive as their “allowance.” In my household, my wife gets more every week than I do, but we both agreed on that amount. Side note: if you own a business, be sure to keep a separate “business” account for all your business income and expenses, and then transfer your “salary” to your joint account (more on that here: 4 Money Tips for Small Business Owners).
5) Start a Joint FUNd. Once you have done the first four things you must do after getting married, hopefully, you have some money left over for fun! I like the idea of a FUN Fund (or FUNd for short) as a short-term savings account for joint experiences. Research has found that people who spent money on experiences rather than material items were happier and felt the money was better spent. Use this account to save for joint experiences, special occasions, stay-cations, travel, etc. When you spend this money on yourselves, you can spend it “guilt-free” because you know this money is for FUN!
Getting married is such a joyful occasion, and hopefully following the 5 things you must do after getting married in this post will help continue that happiness deep into your marriage. If you know a couple who is about to get married or just got married and wants a personalized plan on how to do any of this, please have them contact us to schedule a consultation. These are my five financial tips for newlyweds. Do you have some other ones? If so, please let us know in the comments section below.
- Published in Love and Marriage
By Jeannie Rodriguez | Dr. Budgets
Next month will mark the five-year anniversary of the day Daniel and I met, and it has been a wonderful five years! Three years (to the day!) after we met, we were married and there are a few things I’d like to share about what it’s like being “Mrs. Budgets.” When I tell people my husband is a money coach, I explain that he’s like a personal trainer for your money. He sits down with his clients each month to review their spending, he looks for places to save money, and he helps people achieve their financial goals. I think people have some ideas about what it must be like to be married to a money coach – for example, that Daniel is very frugal with his money – and I’m here to tell you the TRUTH about what it’s like being married to a money coach:
We Make a Budget Every Year and Review It Every Month
When we first merged our finances, Daniel and I sat down and had a conversation about how we spend our money and how we want to spend our money. We mapped out our financial goals and what was really important to us – just as Daniel does with his new clients! You might think that looking at your spending is a painful conversation, but it’s not at all! Daniel gets right to the good stuff to talk about what your financial goals are, and it’s a really positive discussion. With those things in mind, we look at the different spending categories and determine how much we’re going to spend in each category.
Once we have our budget, we review our spending each month to see how we did. Most months, we do well in each category and might overspend in a couple categories – but that just means we try to do better next month. I thought that I would DREAD these monthly budget reviews, but it’s so enlightening! Before I met Daniel, I couldn’t tell you how much I spent on dining out or groceries – and, I won’t lie, it would get away from me and I was overspending every single month. Now, I look forward to talking about our money because it’s such a positive conversation, and I know where we stand as far as spending and can see our progress toward our long-term financial goals.
I Get a Massage Every Month
When we talked about what was important to us, Daniel said that it was important for him to enjoy a massage every month, so we put that in the budget for him and for me! I think many people think of Dr. Budgets as being really frugal and not spending money on any type of luxury – but that’s not true! He’s all about cutting the spending that doesn’t matter so that you have money to spend on what’s important. He’d never tell me I couldn’t indulge in a luxury I want (mani/pedis, a facial or spa day) – we would just need to look at the budget together to decide from where the money would come.
I Buy Whatever I Want and He Never Questions My Spending
You’d probably think there are a few months where the monthly budget review could get pretty intense (around the holidays, for example, when I can get a little carried away with gifts, holiday parties and decorations!) but it never has. We have structured our budget in a way that we each get money every week to spend on whatever we want – and I love it! Basically, each of our incomes goes into our joint account, and from that account we pay for our joint expenses like:
- Mortgage and Utilities
- Automobile Expenses
- Groceries and Daily Living
But also from that account, we each have money transferred to our personal accounts each week for spending outside of joint expenses. That’s the money we use to buy gifts for each other, special indulgences (spa days, the latest tech toy, etc), going out with my girlfriends, and whatever we want! Daniel never questions this spending because it’s my fun money. I’ve never felt like I had to hide big purchases or justify a new dress – he doesn’t question how I spend my money.
We Treat Our Friends
Imagine you go out to dinner with Dr. Budgets and his wife, and the check comes… you might think that he’d bust out the calculator and determine (to the penny!) how much you each owe – but that’s not the case! One thing that is important to us is that we want to treat our friends occasionally and never let money come between friendships. It’s nice having money in our budget set aside so we can treat friends to a ball game, dinner, or movie tickets.
I Don’t Clip Coupons (Although Daniel Does Sometimes)
I do not enjoy clipping coupons. If I see a coupon for a place I shop often, I might stick it in my wallet to use later, but I’m not coupon crazy. You might think Mrs. Budgets is an “extreme couponer” by association but, while Daniel will use coupons for things, I almost never do (and he’s cool with that) 🙂 Since I do all the grocery shopping for the house, I do have some tricks to saving money on food without clipping coupons.
I Never Worry about Money
When I met Daniel, I had a lot of credit card debt – but I was well on my way to paying it down. I was renting out a room to help pay my mortgage, and at the beginning of each month, I remember rushing to deposit her rent check because I never had a buffer in my account to cover the mortgage payment. I also remember checking my credit card balance while standing in line at the grocery store to see if I had enough funds to cover what I needed to buy. Basically, I was constantly worried about money.
After I paid off my debt, I felt like a huge weight was lifted! And after Daniel and I merged and organized our finances, I soon realized I wasn’t worried about money at all. I never need to worry because we have automatic payments and buffers, and anything I need or want to buy is accounted for in the budget.
Being married to Dr. Budgets sounds pretty great, huh? At least, I hope it doesn’t sound like I’m married to an extreme cheapskate who makes me eat Top Ramen every night, as many people might think when I say I’m married to Dr. Budgets 🙂
The best part? I’ve heard numerous Dr. Budgets clients say they have many of the same benefits by having Daniel as a money coach! If you’d like to get a massage every month, review your monthly spending and financial goals, and stop worrying about money, then you should talk to Dr. Budgets too!
- Published in Love and Marriage
By Daniel Rodriguez | Dr. Budgets
With wedding season upon us, we are focusing on couples and money during the month of May! We kicked off with a success story from Owen and Amanda, who are working together to pay off their debt.
Their story got me thinking about how Dr. Budgets can help couples (specifically) with their money. Here are five ways I help couples and money mix:
A Compass: The first thing I do when I start working with my clients is identify strong financial goals. Sometimes, in the process of saving toward financial goals, people can get off track and need somebody to point them in the right direction. This is especially important with couples because each person in the relationship may get off track at different times, which will require a gentle reminder from me (as opposed to that reminder coming from the other person in the relationship).
A Scapegoat. One thing I hear from my couple clients is that my name comes up often when they make financial decisions. Before they decide to blow their dining out budget on an expensive meal, one person will ask “what would Dr. Budgets say?!” It may sound funny, but it starts a conversation that neither person may want to initiate (but know they should!). After working with me a short while it becomes easier to start conversations about money, but until then I’m happy to be the scapegoat.
A Resource. If you were to get an unexpected bonus or other source of income, would you know what you should do with it? Maybe you know what you want to do with it! My clients come to me with questions about “extra” money all the time. I think they find it helpful to have some guidance so they don’t spent it on something that is not in line with their goals, or contrary to what their other half thinks they should do with it!
A “Numbers Guy.” I love numbers because they make sense to me – I can categorize your spending and show you exactly where your money is going. But not everybody loves numbers like I do. Clients enjoy the clarity that comes with having their spending categorized because it removes the uncertainty of their spending – there’s no more “I think we spent $200 a month on dining out” because I can show them exactly how much they spent.
A Neutral Third Party. People spend money differently, and often times different types of spenders get married 🙂 One person in the relationship might frequently buy clothes and shoes so their partner thinks that they are the reason for their dwindling bank account (or mounting debt) – and it’s easy to point that finger! Until we sit down and look at the numbers and learn that the finger-pointer may be contributing to debt just as much as his/her partner. He/She might not make frequent purchases, but will drop a couple thousand dollars on a new entertainment system. As your money coach, I never judge – I simply bring awareness to your spending and put you on the right path to achieve your goals.
As you know by now, I LOVE helping my clients achieve their goals. When I work with clients, my focus is helping them achieve their goals, but sometimes having a money coach does even more than help to get them out of debt or save for a house. Money is the number one thing couples fight about, but when you’re talking about money and working together to save for financial goals, it’s one less thing to fight about! I’ve heard from so many of my couple clients that they’re talking about money – some for the first time ever! As a newlywed myself, hearing that makes me especially happy. For more tips this month about love and money check out our Dr. Budgets Facebook page.
- Published in Love and Marriage
By Jeannie Rodriguez | Dr. Budgets
Last week, Daniel wrote a blog on how packed lunches can be good for your health and your wealth, and in the spirit of St. Valentine’s Day, I’d like to add that packing lunches for your loved ones can be a very loving gesture… you might even say it’s romantic!
Consider all the benefits of having a regularly packed lunch for your loved one:
Health: it’s likely that what you pack is much healthier than something bought at a fast food restaurant or cafeteria.
Energy: for many, enjoying packed lunches means skipping the crash that inevitably follows high calorie carb-heavy lunches.
Time: having a packed lunch saves your loved one from having to leave the office and wait in lines.
Variety: helps your loved one break out of the turkey sandwich rut we can all get into.
Financial: preparing packed lunches saves your loved one money!
If that’s not enough to get you excited about packing more lunches for your loved one, consider adding these special touches:
Fruit Messages: “You’re the Apple of my Eye!” and “I’m Going Bananas Over You!” would be such sweet surprises on a healthy treat. Sadly, this webpage doesn’t have the free printable version anymore (and their Etsy shop is temporarily closed) but check them out for inspiration. Also, on some fruits (such as oranges and bananas) you can write directly on the skin.
Sprinkles! Sprinkles kick up the fun factor for any meal (for kids and adults!) and they’re a delicious addition to yogurt and applesauce. (source)
Love Note: a simple handwritten note will brighten anyone’s day. Grab a post-it note (or even the back of an envelope) and just write a short note to say “I love you!” – and this is something anyone can do!
I hope you enjoyed these tips on making packed lunches romantic. If you have any other tips, please share them in the comments – I’d love to hear them!
- Published in Love and Marriage
So you married the love of your life, but are unsure of how to merge your finances? Yes, talking about money can get emotional, and sometimes it is not easy to express yourself in a way that doesn’t hurt your spouse’s feelings. There is no right or wrong way to merge your finances. Whatever works for the both of you is the best way. It is important to openly communicate with each other about your goals and what is important to you, then build a financial strategy and structure around that conversation. Sometimes it really helps to talk with a neutral third party who can take some of the emotion out of the discussion. You should both be involved and know where the money goes, even if only one of you has a detailed overview of the finances. If one person pays the bills, make sure the other person is kept in the loop so that you are both on the same page. Here is how we structured our household finances:
First, a percentage of income automatically goes into retirement plans (i.e. 401k) and into our joint savings account for long-term expenses (i.e. down payment for our future home, down payment for our next car, a bathroom remodel, our trip to Europe, etc.).
The rest of our income flows into our joint checking account. Most of our joint expenses are paid out of this account, including:
*Health & fitness expenses
*Day-to-Day expenses (groceries, toiletries, joint gifts, dog expenses, etc.)
Finally, we each have a separate checking account that we use for our own personal expenses. These separate accounts allow us to spend money on what is important to each of us without having to consult with the other person. This gives me the freedom to buy Aztecs basketball tickets, and it gives her the freedom to take a girls trip to Las Vegas. How this money is spent is really up to each of us. We each have the same amount transferred to our individual checking accounts every week from our joint checking account. Examples of what we spent from these accounts include:
*Personal Care Services (i.e. hair, nails, spa)
*Shopping (i.e. clothing, technology, gadgets, movies, music)
*Gifts for each other
This system has been working for us, so hopefully it gives you some guidance when you are setting up your own system. Dr. Budgets works with many couples and has seen other options for deciding how much money to transfer to each person. Here are some other options:
*Each person receives a percentage of his/her income instead of equal amounts
*Transfers are made once a month instead of once a week
*Instead of depositing all income in the joint account, each person has income deposited into his/her individual account, then transfers a set amount to the joint account for savings and household expenses.
If you need a neutral third party to help you navigate through the emotional side of setting up your financial system, give us a call at 619-800-3030 for your complementary consultation. Also check out our Facebook page (www.facebook.com/drbudgets) in June for more financial tips for married couples. If you have any questions or comments, please post them in the comments section below or e-mail me directly at firstname.lastname@example.org.
- Published in Love and Marriage
Congratulations on your engagement! You’ve found the love of your life, and are now somewhere in the process of planning your amazing day. Whether you and your soon-to-be spouse are paying for the affair yourselves, or you have help from family members, you’re probably working within a budget. How do you manage to stay within that amount and still have your dream event? My fiancée and I were faced with this same question, many months ago, when we started to plan our wedding that is coming up here in June. Based on my experience, here are 10 tips on how to have the most wonderful day without going deep into debt:
The best thing you can do to help with the planning process is to start with a vision of your wedding day. What is important to you? How do you want your big day to go? What are your “must haves,” and what is not so important? Pick a few words that sum up how you want your wedding to be (Creative, fun, and colorful? Intimate, romantic, and sweet?), then refer back to these words whenever you have a decision to make. For our wedding, we want our guests to have fun and enjoy the celebration of our marriage, so every decision we have made has aligned with that vision.
Create a wedding budget. It will help keep you out of debt, or at the least minimize the amount of credit you need to use for your wedding. Find a budget template online (or email me and I’ll send you my template), and refer to your vision as you assign dollar amounts to each category. Once you have created your budget, be sure that the people who are helping you plan your wedding know your budget too! Take a look at this infographic that does a great job of laying everything out: http://visual.ly/ultimate-wedding-cost-checklist-infographic. We created our budget right away, and it has truly helped us out with our decision-making.
The greatest influence on your budget is how many guests you are going to invite. Each guest adds at least $100 to the cost of the wedding, and most guests come with a “plus one,” so the overall cost can add up fast! Here is an excellent flowchart to help you through the process: http://noeyehasseen.com/blog/borrowed-and-blue-the-dreaded-guest-list. My fiancée and I decided we didn’t want to meet too many people for the first time at our wedding. If there is a friend of mine who she hasn’t met in the two and a half years we have been together, then they didn’t make it onto the guest list, and vice-versa. This made the decision-making process much easier, and didn’t favor either one of us.
This is an area that can quickly get away from you. Band, DJ, photo booth, disposable cameras, fireworks, and whatever else you can imagine. Since our vision centered around the guest experience, we could have easily spent a fortune on all sorts of different ideas. A band is much more expensive than a DJ, so we picked a great DJ, which saved us $5,000 that we could use on other areas to enhance the guest experience. This was a tough decision, especially for my fiancée, but ultimately there were other aspects of the wedding that were more important.
There are ways to save money on alcohol without diminishing the guest experience. Our venue doesn’t allow shots, which is saving us some money. We were also able to purchase our alcohol from BevMo, and have it chilled and delivered to the venue the day of the wedding. We saved between $1,000-$2,000 purchasing the alcohol this way, even though we have professional bartenders. Finally, we decided to serve only beer, wine, and a signature drink, which also keeps costs down without affecting the overall wedding day experience.
It’s easy to justify spending a lot on photography because, after your wedding is over, photos (and/or videos) are what you’ll have left to capture the memories. But that doesn’t mean you need to spend a fortune. Aim to spend no more than 10% of your budget on photography. Check out different photographers and their styles, and confirm what is included. Some photographers may charge less to photograph the big day, but make their money on selling prints after the wedding. Others may have a larger fee, but will provide a CD of all the images so you can print them yourself. So again, set your budget and stick to it.
Shop around for a florist! Prices vary widely. Often you can get a better price from a florist who is newer to the business. Flowers are more affordable when they are in season, and if you move flowers from the ceremony site to the reception area, you can save several hundred dollars.
When evaluating invitations, remember to factor all costs associated with them: postage (to mail to your guests and on the RSVP envelopes), embellishments, calligraphy or labels, and envelopes (inner, outer, and RSVP). If your invitations don’t have to be super fancy, you can save some money by using services like Vistaprint. My fiancée is very creative, so she designed really nice ones for a fraction of the normal cost. If invitations rank really low on your priority list, you may want to consider a nice email invitation.
The wedding industry plays on emotions, and there might not be any aspect of a wedding that has more emotion than the dress! If you’re open to it, there are lots of ways to save on your dress: you can borrow a beautiful dress or accessories from a friend, you can purchase a new dress from a sample sale or pre-owned dress online (many dresses sold online have never been worn because brides changed their minds, got pregnant, or called off the wedding), or “copycat” dresses from seamstresses on Etsy.com.
Have you been thinking of hiring a wedding planner? Do it! A great wedding planner can save you thousands of dollars because of their connections and creativity. Our wedding planner’s connections and ideas have saved us lots of money! As an added bonus, a professional who does this all the time is taking care of everything and thinks of everything, so you can enjoy the planning process and your wedding day.
These are the top 10 tips from my experience in planning our wedding. How did you save money without affecting the overall wedding experience? Please share in the comments section below or on www.facebook.com/drbudgets.
If you are saving money for a wedding, planning a wedding, or need help merging your two households after getting married, give us a call at 619-800-3030 for your free consultation. In celebration of my wedding next month, we are currently running a special of $50 off a budget package through June 30, 2014!
- Published in Love and Marriage