This is a guest post from my friend Isabel of Family Life Blog.
Do you and your spouse want to make smart decisions without causing years and years of harm to your financial lives? Here are some of the main financial mistakes to avoid as newlyweds that you need to know about right now!
5 Financial Mistakes to avoid as Newlyweds
My husband and I have made all the possible financial mistakes you can imagine as newlyweds. Buying a house we couldn’t afford? Check. Getting pregnant and buying the house we couldn’t afford all at the same time? Check. Add a brand new car to the equation? Check. Before we go on, I just have to make one thing clear: my son was not a mistake, but not planning for his arrival was!
On top of all the above mistakes, there were tons of habits that my husband and I had at the beginning of our lives together that just didn’t make for a healthy financial situation. These are all simple things that you can change that will bring you from financial disaster to financial success.
What are the main financial mistakes to avoid as newlyweds?
1. Not having a budget
When my husband and I got married, neither of us budgeted. We were being completely free-spirited and going with the flow.
Have you ever seen a banana leaf planted? It sways in whatever direction the wind blows. That was us with our spending.
We had no idea what we were doing. We just kept spending as we pleased, even though we had no idea we were spending more than we were making.
Do you have a budget in place? If you don’t, it’s time to get one done! It will set you up for success in your financial life for sure.
There are a million reasons why you should have a budget.
It will give you clarity about your income and expenses, it will give you a complete picture of your fix and variable expenses, guide you on how much you can spend in each category, and allow you to save for future events and plans.
2. Not planning for future events
Whenever we had an idea or a dream that we wanted to accomplish, we never sat down to discuss the financial details and make a plan as to how we would get there.
You see, when you don’t have a plan, you’re planning to fail.
You need to know exactly how much your dream will cost you and if you have the money right now. Or if you don’t, how will you?
A lot of people rely on credit cards as if that credit was money, but it’s not. All that credit is simply money you DON’T have.
If you want to soar and reach high places without causing future harm to your finances, sit down, analyze your budget, and plan how you will save the money you need to make it happen.
3. Buying everything brand new
Another thing that my husband and I did a lot was buying everything brand new. We never shopped for used furniture, clothes, toys, or anything else.
Everything had to be bought from a store brand new.
Until the first time I went to a second-hand kids store.
When I got in, I was expecting to see old clothes, with holes or faded colors, broken or dirty toys, books with torn pages, etc.
To my surprise, everything looked brand new or with minor little flaws that could go completely unnoticed. Ever since this first visit, I’ve been a loyal customer of second-hand kids stores, thrift stores, and the Facebook Marketplace for furniture.
When you open your mind to those new ways of shopping, you discover that you can save up to 90% on the price of just about anything.
This makes a huge impact on your budget and allows you to save for those big dreams we just talked about.
4. Following what culture says it’s right
This is a big one and it can truly cause long-term harm to your family finances if you don’t watch out.
Culture says people should get married, buy a house, and have kids.
What if you got married, got pregnant, but are not financially ready to buy a house?
I’ve seen a lot of people feel pressured to do so just because of our culture. My husband and I included.
Of course, it’s not just the culture.
There’s all the house fever and excitement to move on to the next big step in our lives.
But before we take this huge step, we have to analyze our situation and make a plan.
Always.
Another thing our culture says it’s okay is to have debt.
Just because for years and years people have lived almost buried in a huge pile of debt, it doesn’t mean we should keep going with the flow and own that.
We can very well choose another path and build a completely different reality for our families.
5. Doing what others are doing
If we look around, we’re always going to find people that we think have everything together.
We see them saving here and there, but buying a new car, a new house, and as I said, we think they have it all together.
So we try to follow their steps and do the same kinds of things thinking that it will work for us like it has worked for them (when the truth is…we don’t even know if it has).
But the reality is that each family has a different financial situation and you and your spouse are the only ones who can ultimately determine what will work for your own truth and what won’t.
*****
Those are all very simple changes that you can make to the way you manage your money that will make a big impact in your short-term and long-term financial life! Being newlyweds, we think we have it figured out, but the reality of starting a family is a little more complicated than it seems.
So always remember:
- Come up with a budget for your expenses
- Plan for future events
- Make an appearance at second-hand stores when you need something (it never hurts to look)
- Don’t follow others or the culture
- Do your own thing!
And just to add one more thing, don’t freak out!
Trust yourself and your spouse. Take one step at a time and take advice from wise people. The best thing my husband and I ever did, was taking Dave Ramsey’s Financial Peace University course and learning from the wisest of the wise! Maybe even consider taking a course together. Learning more always helps.
Have you identified any mistakes you’ve been making in your finances that you should avoid? Please, go ahead and share with us down in the comment section!
Isabel is a Christian wife and mom of two boys. She strives to create a thriving home & family life, and she loves helping others do the same. She writes and shares amazing helpful articles on Family Life Blog.
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