by Frederick Kessinger

Created on: December 16, 2008

Financial planning for married couples is incredibly important not only for financial security, but for relationship security as well. With the recent changes in the economy, many couples that have been getting by without any negative repercussions from a lack of financial planning are beginning to feel the effects of relationship stress associated with poor financial planning.

The most important aspect of financial planning is awareness. Both spouses must be involved in the planning process and aware of the other's income and spending habits. This does not necessarily mean that spending habits should be criticized or changed, but you need to be honest with yourself and your spouse about the way you spend money.

The second most important aspect of financial planning is management. It can be a tedious and sometimes frustrating chore, but it is an absolute necessity. For some couples it may be as simple as keeping the checkbook ledger up to date. For others it may be much more involved. Whatever your level of income and expenses might be, it is a good practice to become familiar with and utilize a software program designed for personal financial management. There are many programs available, such as Quicken, Microsoft Money, or Budget Express to name a few. All of these programs offer banking and bill tracking features, and many of them offer more advanced features as well. Most banks now offer online banking with the same options as the personal finance software.

It is a rare thing for a coupe to be able to sit down and balance the checking account together. Some couples find it easier to have one spouse responsible for this task, and it makes sense to have the spouse that is better at this task take on this responsibility, but both spouses must remain involved and aware of the expenses.

With a good foundation plan for the base aspects of financial responsibility (awareness and management) secured, the next step should be to take a very good look at future goals. This should be done in stages and documented. The first stage of this reverse planning should be a broad view. A very effective basic strategy for any planning process is to start with the end goal and use a reverse planning approach. Begin with your retirement in mind. Determine where you would like to be when you retire, and be realistic. Don't forget to account for cost of living increases and other contingencies, and add in a safety factor in the form of a percentage (something reasonable like 5%.)

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