Getting married? 4 money goals for you

Financial planning need not be boring or solely be a man's job. It can be made fun and be used as another way to increase a couple's closeness and happiness! Try it!

So you have found your soul mate and are going to take your connection to the next level by getting married? Congratulations! While you are planning for a lifetime together, jotting down dreams, and devising strategies to make the journey worth the while, may we suggest that you include financial planning in your agenda as well?

Yes, we do understand that financial planning may be boring, tedious, and not very exciting. However, it is pertinent, important, and crucial to ensure that the ride together is smooth and pleasant.  So find that time together to talk finances and come up with a smart financial plan which will keep you secure and comfortable all your lives!

Define your targets

There are many occasions in life for which you have to meticulously set aside money. Some major expenses which a couple will encounter once they are married, are: for buying a house, planning for child birth and child care, planning for education expenses, periodic holidays and short trips, expenses related to taking care of aging parents, planning for the wedding of their child or children, expenses related to one spouse taking time out to study, emergency medical expenses, expenses related to health when the couple gets older, other unforeseen expenses, and retirement planning.

So as partners, you must sit and make a list of these expenditures. You must also define a tentative time line (wherever feasible) to indicate when you would be in need of this money and also a ball park amount. Take inflation at about 9 per cent to predict the numbers.

Devise financial planning strategies

Once the numbers are in place, it is time for some financial planning. Educate yourselves on the different investment routes available. Read up about them. Hire a certified planner if need be. Consider your current earning, account for future factors, evaluate your risk appetite, and discuss with each other!

Come up with a financial strategy which will help you achieve all your financial goals. Your strategy should nurture and inculcate the habit of savings and should be sustainable. It should be as stable as possible against most forms of contingencies which you might encounter. Get your strategy validated by a professional if possible.

Start moving towards your target

Once you freeze in on the way you want to plan for your finances, you should diligently save, and meticulously keep track of your growth. You should periodically check if your investments are bearing fruits, and if your portfolio is growing.

Typically aiming for a 15 per cent year-on-year growth is a good target. As your earning increases, increase your savings suitably. Keeping track of your progress will help you weed away any bad investment and cut your losses. It gives you the agility to pivot and ensure you reach your target.

Some ways to plan and reap better rewards

Here are some quick ways to ensure that you, as a couple, reach your financial destination!

• Open a joint savings bank account and commit a certain sum of money into it every month
• Make all the payments of your joint investments through this joint account
• Consciously discuss finances in as open a manner as possible
• Raise any concern that you have immediately. Get as objective as possible when it comes to money
• Keep your risk levels high as you begin and keep tapering it down as you grow older
• Have a healthy mix of equity and debt investments
• Do take a term insurance policy to insure all your liabilities. Increase the cover as your liabilities increase
• Money back insurance plans are a good option, when you have a particular target at a stipulated time. Do consider them
• Plan together for your retirement and holidays! Adds to the fun and strengthens your relationship (and your pockets!)
• Make individual investments as well. This way all your eggs will not be in one basket
• If you have different investment appetites and styles, achieve a mid ground for your joint investments while sticking to your individual styles for your individual investments
• Take stock of your investments together. It will increase transparency and trust, apart from ensuring that both of you are on the same page
• Do not criticise if your partner's choice fails. Just ensure you do not repeat it
• Applaud and celebrate whenever you reach a target or when an investment does well! Sharing your joy increases it

Illustration: Dominic Xavier/Rediff.com

Anil Rego is the founder and CEO of Right Horizons, an investment advisory and wealth management firm that focuses on providing financial solutions that are specific to customer needs.