A personal finance checklist for newlyweds

Getting married is one of the most important events in your life. There is so much to consider -- the flowers, the jewellery, the dress, the venue, the photography -- the list goes on. Once you are back from the honeymoon, the daily life of marriage begins and also begins the challenges of managing finances of a new household with your spouse.

In recent studies, many couples ranked financial matters as one of the most essential factors when it comes to happiness in a marriage. It is also one of the key factors causing marital stress.

Here then, is a checklist for the newlyweds that take them through the art of managing money post marriage.

Ramalingam K, an MBA (Finance) and certified financial planner, is founder & director of Holistic Investment Planners (P) Ltd (http://holisticinvestment.in).

Money compatibility

The first thing to do is check how compatible you and your spouse are when it comes to money management. You may be conservative and your spouse may be aggressive. You may think that the best place to invest is the stock market and your spouse may think bank fixed deposits.

You should communicate your money management style to your spouse and you also need to understand his/her money management style. Both of you need to analyse the merits and demerits of each other's way as well as your own.

Then you need to create a mutually agreed-upon, combined money management style.

This will be vital throughout your married life to help minimise stress that arises from disagreements about money.

Update your records

Change of address: You may have shifted to your in-laws' place or both of you could have shifted to a new place. So you need to make necessary change of address requests to your bank accounts, demat accounts, mutual fund accounts and so on.

Change of name: Generally women take their husband's last name after marriage. This needs to be updated in all the accounts.

Change of nominee/Beneficiary: You may like to change the nominee to your spouse for the investments, accounts, insurance policies which you have taken before marriage.

Changes in will: You also need to create a will if you have not so far. If you already have a will, then you need to revisit your it now.

Assign financial responsibilities

You need to decide, who is going to take care of the day-to-day money management, that is paying bills, monitoring investments and the like.

Develop a family budget

You need to create a workable budget for your family that provides you with extra money. This budget should take into account both your incomes, the individual expenses and family expenses.

Create an emergency fund

You need to accrue savings for some surprise situations like loss of job, break in job or sudden expenses like a major repair to your car or house. Generally, the emergency fund needs to be in the range of three to six months' family expenses.

Insurance coverage

So far, you may not have any dependents or maybe just one or two. You may not have considered life insurance or taken a small coverage. This is the time to look at life insurance seriously. When I say life insurance, I am talking about only term insurance and not unit-linked insurance plans.

The market, for its heavy front loaded charges, has rejected ULIPs.

Debt payoff plan

Suppose, you are already in debt, you need to create a debt payoff plan. This plan will help you get out of debt and stay out of debt.

Spend smarter and save more

Spending habits will be different from individual to individual. Both of you need to align your spending pattern and learn how to spend smarter and save more.

When both are working and don't have any plans to raise children is the stage you have more income, especially more disposable income. Couples need to be careful and avoid overspending; save as much as possible during this stage. This will ease you out when you have more expenses at the later stage of your life.

Set combined financial goals

Both of you need to spend some quality time discussing financial goals like buying a home, international vacations and the like. This is the right time to plan your retirement.

Chalk out a financial plan

Once you have set combined financial goals, then you need to chalk out a financial plan to achieve these goals. You need to take into account growth rate of your income, inflation on your expenses, time set to achieve various goals and rate of return expected from various investment options.

This is slightly a complicated procedure and this plan needs to be reviewed periodically. That is why it is better to outsource it. You may seek assistance from a professional financial planner.

The most important thing to remember once you are married is that to succeed financially, it needs teamwork from both partners.

As a newly married couple, you have enough time and plenty of opportunity. I am sure that with this checklist and guidance, you will reach your life goals together.