When I got married more than 7 years ago, I didn’t realize how quickly my financial picture would change. I had a lot of money (at least relative to my age) in my savings account, but my husband definitely did not have money. Less than two months after our wedding, we were selling his newer car at a loss because the payments and interest rate were both much too high.
© denisfilm / Dollar Photo Club
What I realize now, though, is that those first few months and first year as a married couple were not the only times we would have to correct bad financial mistakes. There were years ahead of us where we would make poor financial decisions and would have to learn from them.
5 Pieces of Financial Wisdom for My Newlywed Self
I thought it would be interesting to sit down and write out some money advice for newlyweds. Of course, not all newlyweds will make the same financial mistakes we did, but surely some of these mistakes will resonate with most couples.
If I could write and send a letter to my newlywed self, this is what it would say:
Congratulations on marrying the love of your life. You two have a lot of adventures to look forward to in your future. I would like to warn you, though, of potential financial mistakes that you will make. If you heed my advice, it will be well for you.
First, you will find out soon enough that your husband’s money habits are opposite of yours. Get in the habit now of setting goals, both financially and for life, as a couple. When you do that, you’ll be way less likely to argue over money matters. Find out how each of you feel about money in general and why you want it. You will want to set money roles in your relationship, and always include each other in financial matters.
My next piece of advice would be to agree on what are wants and what are needs in your life. Don’t waste your money on your wants unless you are in a financial position to do so, even if it’s just $20. This way you can live on your husband’s income and save everything you make when you start working. A strong savings account will be especially important when you become a stay-at-home mom and fall on hard financial times.
I know you might roll your eyes with this next point, but you would be surprised how much you can change in less than 10 years. This advice would be to avoid debt at all costs. You might be great at doing that right now, but there will be so many times in the future that you come across something you think you need and get it with a loan. It’s crazy to imagine, but pretty soon you will also get a credit card. Not that you will be irresponsible with these things, but you will end up spending so much more on your “needs” if you just jump into the purchase.
This next one is another where you’ll nod your head in agreement, but, again, things change. So, remember that if you want to purchase a house, you should only do so with at least 20% down. If you have less, you’ll have to pay PMI, which is a huge extra cost that really doesn’t benefit you at all. And when you start the house hunt, don’t settle for anything less than what you truly want. Don’t bid on a house unless you want to call it home for many years to come. Otherwise, you are just setting yourself up for discontentment.
And, finally, my last piece of financial wisdom would be to start a family business sooner rather than later. It really is quite risky to start a business, but if you can start the business while at least one of you has a job, your stress over money will be much less than if you wait to start a business when it is your last option and neither of you has a job.
I know you, and I know that you agree with me on the aforementioned points. But, please, please, please, take them seriously. You might think you will never change and make serious financial mistakes, but it happens to everyone. If you are going to make mistakes, make small ones like spending too much on your kids. Leave no room for error with the big things.
Good luck to you and your new life!
-Your Future Self
Of course there are so many more things I could have written in that letter. I just felt like including some of the most important ones that really could have changed our financial picture as it is today.
Think back to when you were first married. What would you tell yourself about money and the mistakes you would inevitably make in the future?
Christina @ Embracing Simple says
This is awesome!! I so needed to tell myself this when we got married too! We also bought a house with too little of a down payment and we had to pay PMI for three years, which was awful! We just refinanced this year and finally got rid of it – that it the #1 regret I have when it comes to the beginning of our financial life together!
Thank you, Christina! Isn’t PMI just the worst? That’s great you could get rid of it sooner rather than later! I think we still have another 2 1/2 years with it, unfortunately. 🙁