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INTRODUCTION
Planning a wedding is an exciting season in your life, but it also brings significant financial considerations. Talking about money with your partner can create a strong foundation for your future together. Regular “money dates” can help you navigate these financial challenges and build wealth beyond the wedding. You can create a money date routine and choose one or two key topics to discuss during each money date. These conversations will ensure that you and your partner are on the same page and prepared for the financial journey ahead. In this blog post, we’ll explore 8 topics to discuss throughout your money date journey (plus 2 bonus topics at the end of the blog).
8 MONEY DATE TOPICS TO DISCUSS WITH YOUR PARTNER
1. SPENDING
Review Bills And Payment Plans
Ensure all bills are accounted for and paid on time. Discuss utilities, rent/mortgage, subscriptions, and other regular expenses. Include upcoming wedding expenses and how you will pay future bills. Maybe you can cut some bills when you get married. Also, discuss how you will pay these bills. Will you pay these bills from a joint account or assign someone to pay specific bills? Will you pay from a checking account, debit card, or credit card? Reviewing your bills and payment plan during each money date will let you see where your money is going and what changes you can make to improve your finances.
Track Spending
No matter your budget style or spending plan, having a system to track your spending shows you what your money is doing. You can see trends like spending $1000 on groceries and $1500 on eating out. Or maybe find an extra $550 in subscriptions you don’t use. Or perhaps you are saving more money than usual and can move it to your wedding fund. You can track your expenses by looking at your bank statements, creating an Excel spreadsheet, or using a budgeting app like Simplifi or Monarch Money, which you can sync with your various financial accounts to see everything in one place.
I use a combination of an Excel sheet and Simplifi, but do what is best for you. You’ll be surprised by how your money gets spent, but then you can change those habits once you know them.
Check Credit Card Statements
Check statements for accuracy and look for unusual charges to catch any errors or fraudulent activities early. Also, ensure you’re paying off your balance in full to avoid interest charges. You can set up your credit card to automatically pay the total monthly amount to make things easier.
Discuss Upcoming Bills Or Expenses
Plan for upcoming expenses like venue deposits, vendor payments, annual life insurance payments, honeymoon plans, etc. Include deposits for vendors, attire, and other wedding-related costs. Keeping track of these will help you stay within your budget. Your budget will change throughout your relationship with your partner. Find time to talk to your partner about your budget regularly and adjust as necessary.
Automate Your Expenses
Setting up automatic payments can help you avoid late fees for bills and expenses without thinking about it. Automatically set your money up to pay your bills, credit cards (pay in full each month), savings, investments, and insurance. For more inspiration on the power of automation and your financial journey, check out “Automatic Millionaire“ by David Bach.
Check For Fraud
To protect your finances, regularly monitor for suspicious activity. Set up alerts on your accounts to notify you of large or unusual transactions. Consider a service like Aura or LifeLock to get alerts if any accounts have a fraud concern and protect your identity from theft.
2. SAVINGS
Figure Out Your Savings Rate
Evaluate how much you save each month and find ways to increase it. Aim to save at least 10-20% of your income, but adjust based on your financial goals and current situation. Why is your savings rate significant? Saving for emergencies, your wedding, a car, or your retirement means that you have more freedom to pursue the life you want without debt or a job. The higher your savings rate, the more your money can work for you and your goals.
My favorite finance book, “The Richest Man in Babylon” by George S. Clason, walks through personal finance topics like savings rates in the form of stories and how people’s decisions can create or destroy wealth. If you want to build a cushion in your finances, plan for the future, or avoid debt, consider increasing your savings rate. Even if you start with a 1% monthly increase, that 1% will grow and is better than nothing.
Examine Your Emergency Fund
An emergency fund is a fund in which you save 10-20% of your income for things that you don’t plan for. Emergency dental visits, new tires for your car, emergency flight to visit your friend as her cat dies. Your emergency fund also covers your expenses if you unexpectedly lose your job or can’t work. Aim to have 3-6 months' worth of living expenses saved to protect you from relying on high-interest credit cards or loans. If you are retired, plan to have 12-24 months of living expenses saved.
After our wedding, my husband and I started a family emergency fund in a high-yield savings account at Wealthfront, which helps grow your money faster than a standard savings account at a bank. However, any FDIC-ensured online bank with a high-yield savings account will work well for an emergency fund. Only use this money for genuinely unexpected things, such as an emergency. Not for a new bag. Not for a last-minute trip to Belize. Only unexpected emergencies.
Create Sinking Funds
Sinking funds are separate high-yield savings accounts you allocate for a specific purpose, such as a wedding, car, house, travel, etc. You plan to use the money to “drain” the fund, but not until you are ready for the purchase. The sinking fund is separate from your emergency fund and acts as a buffer for your goals, so you don’t need to use credit cards or your emergency fund. So when you have to use money for your wedding or going to a wedding, you have a pool of money to pull from.
WORD OF CAUTION: Do not pull money from your emergency fund to supplement your sinking fund. Your sinking funds protect your emergency fund and prevent you from relying on credit cards. I have used Sallie Mae for various sinking funds, but Ally Bank is another popular option as it also has FDIC-insured online banking features such as checking accounts.
Discuss Upcoming Things To Save For
Discuss potential things to save for in the future or upcoming events. Plan savings for the wedding and other future needs, like a honeymoon, home purchase, family travel, or kids. See if you need to contribute more money towards your “wedding fund” or “travel fund.”
3. DEBT
Evaluate Current Debts And Pay Off Plan
This may be challenging, but you must do it. Review all your debts as well as your current payment plan. Are you in a lot of credit card debt and trapped in the debt cycle? Do you have a timeframe for when you will have all your debts paid? Do you have a plan to stop accruing more debt? Have you talked to your partner about debt?
If you need help with a debt payment plan, try checking out Dave Ramsey’s “Total Money Makeover“ and the snowball method. I used Dave Ramsey’s snowball method to become debt-free. You pay the minimum balance on all your debts and then focus on the lowest balance to gain a quick win. Focus on high-interest debt from credit cards first. Then, you apply the amount from the paid-off debt to the next debt. It makes you feel great while getting rid of debt.
Another great book that discusses how to pay off debt is “Millionaire Mission” by Brian Preston. It discusses the Financial Order of Operations (FOO), a step-by-step method for using your “next dollar” that includes steps to pay off debt. There are other systems and plans, but the most important thing is to find a system and a timeframe that works for you.
Make Debt Payments Automatic
Ensure all debt payments are on time with automatic payments. Consider paying extra when possible to reduce your debt faster. Focus on high-interest debt first, as it costs you more in the long run.
4. INVESTING
Discuss Your Goals For Investing
Consider your future goals and how money can get you there. Do you want to retire? Maybe you want to have $5 million before you are 67. Perhaps you want passive income and tax advantages from real estate but don’t want to be a landlord. Once you identify your money goals, you can start investing. If you don’t know anything about investing and are wondering where to start, consider reading the book “A Random Walk Down Wall Street” by Burton Malkiel, where he entertainingly talks about the history, benefits, and risks of investing. For other books on investing, check out the Engaged Financials Suggesting Reading page.
Assess Your Investment Needs
Any investment involves risk at some level. Know your “risk tolerance” for each investment before you give money. Do you have a lot of time to manage your assets? Perhaps you want something more passive so your cash works while you enjoy life. Maybe you want to invest for 10 years instead of 30 years. Can you tolerate something that fluctuates, or do you want something more stable that will preserve your money? These are questions to discuss on your money date before investing.
Minimize Risk
A money date is a perfect time to assess an investment's risk profile and your risk tolerance. Want to minimize risk? Invest in things you understand and diversify your investments. Diversifying your portfolio reduces risk and maximizes returns because it spreads risk among various areas instead of putting all your money in one location. That means your overall investment portfolio will be great if one area falls, but the other places are great. One question to consider is, “Will my family or I be okay if all this money is gone?” If the answer is no, then reassess before you invest.
Evaluate Current Investments
Review your IRA, 401(k), brokerage accounts, and real estate investments. Ensure your investments align with your long-term financial goals. Don’t know where to invest? Consider low-fee brokerage firms like Vanguard, which have several low-cost index funds. Another good place to consider is Fidelity, which allows you to start investing as low as $25 a month.
Look At Your Contribution Rates For Your Investments
Check if you can increase your contributions, especially if you get a raise or bonus. Maximize employer-matching contributions if you have a 401(k). Even if you can increase 1% of your income, that money can grow exponentially over time.
5. OTHER ESSENTIAL FINANCIAL TOPICS TO DISCUSS DURING MONEY DATES
Taxes
Stay updated on any tax-related tasks, such as estimated tax payments or gathering documents for your tax return. Check your tax withholdings to see if they are accurate. Research if there are tax-saving strategies to use to save money unique to your tax situation. Consider consulting a tax professional to optimize your tax strategy.
Insurance
Review your policies and coverage to ensure you have the proper protection in place. Includes health, auto, home/renters, life, identity theft, and disability insurance. Ensure your coverage levels match your current needs, especially if you are getting married or have children. Use resources like Policygenius to find an insurance quote to suit your budget.
Wills
Ensure your estate planning documents are up-to-date and reflect your current wishes. Review your will, power of attorney, and any beneficiary designations on your investments.
Charity
Evaluate your charitable contributions and decide whether you can allocate a portion of your budget to causes that are important to you. You can feel amazing giving to a cause that matters to you, like saving puppies or giving kids clean water. Some charitable donations can be tax deductible, saving you money on your taxes.
6. FUTURE FINANCIAL GOALS TO DISCUSS DURING MONEY DATES
Wedding
Budget and save for these events to avoid financial stress. People are either going to weddings, having a wedding, or saving for a future wedding for kids, so it’s best to be prepared. Break down the costs and set specific savings goals to cover each aspect of the wedding.
Travel
Plan and save for future trips, including your honeymoon. Research costs and create a savings plan to cover flights, accommodations, activities, and other expenses.
Kids
Consider future family planning expenses and start saving early for education, childcare, camps, extracurricular activities, and other child-related costs.
House
Discuss saving for a house during your money date by setting a realistic savings target for a down payment and closing costs based on your desired area. Create a high-yield savings account for your home fund and determine how much you can contribute monthly. Regularly review your progress and adjust your savings plan to stay on track.
Career
Invest in career development opportunities to increase earning potential. Discuss further education, certifications, or attending industry conferences.
7. IDENTIFY IMPROVEMENTS
During your money date, identify areas where you can improve your financial habits and systems. Look for ways to cut unnecessary expenses, increase savings, and optimize your investments. Regularly assessing and adjusting your finances ensures you stay aligned with your goals and build the future you hope for.
8. CELEBRATE WINS
What good thing happened with your finances that you want to celebrate? Celebrating your progress helps keep you motivated and positive. Whether it’s paying off a debt, reaching a savings milestone, or sticking to your budget, take a moment to celebrate together.
BONUS TOPICS TO DISCUSS DURING A MONEY DATE
NET WORTH
Net worth is a vital financial number to track at least yearly. Your net worth represents the difference between what you own (assets) and what you owe (liabilities). List your assets like cash, investments, real estate, personal property, and other valuable items to calculate it. Next, list your liabilities, such as mortgages, loans, credit card debt, and other outstanding debts. Subtract your total liabilities from your total assets to determine your net worth. Regularly tracking your net worth provides a clear picture of your financial situation. Some budgeting tools like Simplifi and Monarch Money will also calculate your net worth.
Improving your net worth involves increasing savings, reducing debt, and investing wisely. Tracking your net worth is also essential for wedding planning because it shows how your expenses affect your overall finances. Knowing your net worth during wedding planning ensures you allocate funds effectively and avoid overextending yourself financially, setting a solid foundation for your future together.
CREDIT SCORE
Your credit score is a three-digit number reflecting your creditworthiness and is reviewed by lenders, landlords, and employers to assess financial responsibility. Factors influencing your credit score include payment history, credit utilization, length of credit history, types of credit, and new credit applications. Maintaining a good credit score is crucial as it affects loan approvals, interest rates, rental applications, and employment opportunities. To improve your credit score, pay bills on time, reduce debt, regularly check credit reports for errors, and limit new credit applications. Discussing your credit score with your partner is essential for securing better financing options for your future.
CONCLUSION
Incorporating money dates into your routine and discussing these topics over time can be a powerful way to improve your finances, strengthen your relationship, and build wealth beyond your wedding day. You don’t have to do all the topics at once, but focus on one or two to walk through during each weekly money date. By openly discussing and managing your finances together, you can make informed decisions, achieve your financial goals, and enjoy peace of mind as you embark on your new life together.
IN SUMMARY
8 Money Date Topics To Discuss With Your Partner
- Spending:
- Review bills.
- Track spending and create a budget. Explore budget apps like Simplifi or Monarch Money to track your spending.
- Check credit card statement.
- Discuss upcoming bills or expenses.
- Automate your expenses.
- Saving:
- Figure out savings rate.
- Examine your emergency fund. House your emergency fund in high-yield savings accounts like at Wealthfront.
- Create sinking funds. Other places that have high-yield savings accounts include Sallie Mae and Ally Bank.
- Discuss upcoming things to save for.
- Debt:
- Evaluate current debt and payment plans.
- Make debt payments automatic.
- Investing:
- Other financial essentials:
- Taxes
- Insurance
- Wills
- Charity
- Future financial goals:
- Wedding
- Travel
- Kids
- House
- Career plans
- Identify Improvements.
- Celebrate wins.
- Bonus topics: Net worth and credit score.
Which topic will you discuss on your next money date?
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