Money and marriage

Financial planning for marriage and beyond

Many couples are putting off marriage and having children because of financial insecurity, according to media reports citing the government.

It seems strange to set aside “life” – and “love” – while saving enough to afford a dream wedding and house. It’s also probably not as “sexy” to discuss money with your partner, but financial health is vital in any successful marriage. You must carefully work out each other’s financial goals and how they align, intertwine, and sometimes deviate from each other. Doing so will make your married life more manageable.

Let’s look at some financial planning tips to consider:

Budgeting for the wedding

You only get married once, so you may want it to be as grand as possible. However, it is essential to set a realistic budget early on and avoid overspending. Consider that the average cost of a traditional Filipino wedding is anywhere between PHP 50,000 and PHP 300,000. It is also a good idea to consider setting up a savings account dedicated to a specific goal, such as planning your wedding. This minimizes the risk of dipping into each of your bank accounts.

Life as newlyweds

Once the wedding is over, you should focus on building a solid financial foundation for your new life together.

Note that every couple is different, so it makes sense that their wealth-planning strategies also differ. As a married couple, you must decide how to manage your finances, whether by keeping separate bank accounts, having a joint account, or both. Many financial experts recommend keeping your personal (and individual) bank account for your private expenses.

Couples might opt for a "yours, mine, and ours" approach, where they each maintain individual accounts for personal spending while contributing to a joint account for shared expenses.

A joint account can help manage shared finances, but discussing this with your spouse is also necessary. A joint account simplifies paying for shared expenses like housing, groceries, and utility bills – providing a clear view of household finances. It also fosters transparency and trust, as both partners can easily track spending and ensure they are on the same page financially.

However, a joint account is not essential for every couple. Some may prefer to keep their finances separate, especially if they have different spending habits or income levels.

Whatever approach you decide, make sure you and your spouse are transparent and define “shared” expenses. Avoid taking a “bahala na” mindset to your joint bank account and becoming surprised or upset if your spouse uses that account for an expense you didn’t consider “shareable.”

Planning for family expenses

If you plan to start a family, you must factor in the additional costs of raising children. One of the most significant expenses is childcare. Are you going to be a stay-at-home mom or hire a nanny? Who will care for your baby if you and your spouse are working? Even if your child stays with their grandparents, you still have to pay for other childcare expenses, including pediatric visits, diapers, food, etc.

Next, consider education. Whether you plan to send your child to public or private school, costs will be involved. How will your kid go to school? Will you drive them there or hire a bus service? Ensure you carefully budget this, including emergency funds for school supplies and extra uniforms.

Healthcare is another critical expense. If you’re working a corporate job, ask your human resources about your health insurance coverage, including doctor visits, prescriptions, and emergency care for your children. Even with this, saving a percentage of your monthly salary toward your child’s healthcare is wise.

Lastly, remember to budget for extracurricular activities. Children often engage in sports, music lessons, or art classes, which can enrich their development and come with additional costs. Proper planning ensures your child can participate in activities they enjoy without straining the family budget.

Building a solid financial future together

Financial planning is crucial for newlyweds to ensure a smooth transition into married life and a secure future. By carefully budgeting for your wedding, preparing for life as a couple, and planning for family expenses, you can lay a strong foundation for a happy and prosperous future together.

We talk about this more in our free Earnest e-book.

Disclaimer: This article is for general information purposes and does not constitute formal financial advice. Always do further research before making financial decisions and seek professional advice from a certified personal finance counselor. For more information, read the Earnest disclaimer here.