Creating a Financial Plan as a Couple
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Today we’re talking about how you two can really review the big picture and create a financial plan to make sure you hit YOUR big money goals!
I wouldn’t call it a guilty pleasure, but when I’m online, I do enjoy taking those online quizzes or reading those posts where they break down in a chart where you should be at certain milestones.
Even the personal finance space has them.
One type of post, in particular, that’s popular is how much you should have saved by 20, 30, 40, and so.
Another is about your 401(k) balance.
And even though I shrug it off and you might too, a part of you might be comparing your numbers to what you saw.
There's something appealing about knowing where you stand, but as you guessed, an online quiz is not your best reference source.
So what is?
What's the best way to make get a clear idea of how you two are doing financially?
Financial Check-ups for Real Life
The first half of this year is about over, so how are you guys doing right now?
It’s funny how time seems to speed up and slow down.
Looking back we have had some big ups and downs in the past four or so weeks, both financially and in our lives.
Last month our adorable cat had some seisures and other issues and in a span of week – if that – he went from sick to passing away.
It was so fast, the vets were trying to figure out what happened.
And because a few issues, we just got his remains last week and paid his final expenses.
Thankfully we have savings, but between emergency hospital exam, tests, and his vet visits, it definitely was pricey.
Besides that weight, we had good things to celebrate.
We were invited to two baby showers and then last weekend we went to two graduation parties. And of course, they are bunched together.
But that’s life, right?
At least for us.
And I find it so easy to let certain things slip by because there are more pressing or immediate things happening.
The danger is by focusing only on the immediate or urgent you miss important stuff.
I don’t think money is the most important thing.
I do however realize that much of our day to day and long term goals need us to be on top on our finances.
We should have a game plan for our money and a system that allows us to put in place so when things come up – and they will- our finances keep chugging along.
Which is why I’m so glad Cathrine Bryant is joining in today’s episode.
She’s a financial advisor at Coastal Wealth Management.
In this episode we’ll discuss:
- Getting a financial snapshot and prioritizing which goal or two is your focus
- Setting up a system to both track your money and getting into a habit of money dates
- Finding a financial planner when you need a check-up with a professional
Hope you enjoy!
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Resources to Stay on Top of Your Money
Want some help staying on top of your money? Here are some resources to make managing your money much easier!
- Best Budget and Money Apps: Personal Capital, Tiller, Mint
- Grow Your Stash Faster: High Yield Savings with CiT Bank
- Automatic Saving: Qapital
- Jumpstart Your Marriage and Your Money
- How to Find the Right Financial Advisor for You
- 5 Powerful Financial Goals for Couples to Build Their Marriage and Wealth
- How to Find a Financial Planner You Can Trust
- Making Sure Your Family Financial Goals Fit You
- Build Your Marriage & Wealth with Money Dates
Thank You to Our Sponsor Coastal!
Support for this podcast comes from Coastal Credit Union! If you’re living in the Raleigh Durham area and looking to bank better, come check out Coastal today.
If you want to be better prepared financially, please consider Coastal’s Retirement Planning Program!*Non-deposit investment products and services are offered through CUSO Financial Services, L.P. (“CFS”), a registered broker-dealer (Member FINRA/SIPC) and SEC Registered Investment Advisor. Products offered through CFS: are not NCUA/NCUSIF or otherwise federally insured, are not guarantees or obligations of the credit union, and may involve investment risk including possible loss of principal. Investment Representatives are registered through CFS. Coastal Credit Union has contracted with CFS to make non-deposit investment products and services available to credit union members. Trust services available through MEMBERS Trust Company. CFS and Coastal Credit Union are not affiliated with Members Trust Company.
Creating a Financial Plan That Fits You
Elle: One challenge that we face with trying to come up with any financial plan is that many of us are dealing with several goals at the same time.
Catherine Bryant: We are the generation I tell you where we're trying to put kids through school at the same time we're paying off our own student loans, right?
So it's sometimes a difficult situation to figure out what you know which do we do first or how much do we put towards each one. And that's where I think a financial plan is really the best first start.
So how do you decide which goals to focus on and when to focus on them?
Something that's been helpful for us and other couples is thinking about it as if you were planning an epic trip.
How would you do that?
First, you dig into possible destinations and then maybe you nail down one particular spot you want to go to or a few during your trip.
Once you have an idea of where you want to go from there you can then work backward look at flights train tickets hotels bed and breakfasts. You get the idea and it's the same thing with our finances.
What exactly are your financial goals? Is there one big one that you're working towards or there several that you're looking to hit?
What you want to do in the order you want to do them makes all the difference and that's why even though it's fun to check out those quizzes and look at those charts it's really not helpful because different goals have different milestones.
Even within those same goals, they can be such a variation about how much money you'll need to hit it depending on your situation.
For example, let's take financial independence.
It's a very attractive goal for many people – this idea that you save and invested enough that you don't have to work but it can vary couple to couple for what that means.
One couple might decide that they want to save and invest just enough so that their basic needs are taken care of. It gives them peace of mind and freedom to switch careers maybe travel abroad or volunteer more.
Then you have another couple and they're really serious about the retire early part. They absolutely want no pressure to work again.
The amount that they're saving and investing for is probably going to be much higher than the first couple. And even more so if they decide to have a certain lifestyle that they want to upkeep during their retirement and that's their decision.
So with just this quick example hopefully you can see that even if on paper the goal looks the same you're going to have different numbers and variations with what milestones you're going to hit and how much you're saving and investing towards.
Once you have an idea of the goals that you want to tackle then you have to look at the other side. Where are you now?
How much debt do you guys have? How much is already saved or invested towards? These numbers are crucial because they give you a clearer picture of how you're going to create this game plan.
‘Do We Need a Financial Planner?'
Now you could do this at home and sit down and talk about it. But if you want a financial planner This is a great instance where having an objective third party can help you get more comfortable.
Sometimes when it's just the two of you it's a bit harder to talk about money especially if you haven't had much success in the past or this is a new thing that you're trying out.
Having a third party person to objectively walk you through what your goals are and also looking at the numbers can make it less stressful and more productive.
Catherine Bryant: So as a couple, what we always recommend is let's get it on paper.
Let's see what your financial picture actually looks like. Either good or bad but at least we know. And then from there we can make some recommendations to you to get you on track pending what your goals are and what our financial history is.
Not everybody is the same.
We have some people but command that their goal is to buy their first house.
We have other people that they feel like they're about to approach a nice retirement but they don't know for sure.
So the nice thing about Coastal is we deal with all members regardless of where you are in your financial picture.
What's working successfully a for you? What is it that you liked about that and what's maybe holding you back or keeping you back from reaching that financial goal?
Setting Up Your Financial System
Elle: So once you know what you want to do and where you're starting from you can create a plan to get you there and that's what a budget is.
It moves you towards that goal month by month getting closer to either paying off debt saving for your goals are investing for the future and to agree on the main components main pieces of your spending plan budget whatever you want to call it.
My next piece of advice is to go ahead and automate it. And just looking at the last 12 months for us personally how to meeting our money was a smart move.
We had house projects we, unfortunately, had some friends and family in the hospital. Some had passed away.
We still had the normal day to day stuff with work taking care of the kids as it probably sounds you can sense that it can be overwhelming to deal with so many things at the same time.
So that's where a lot of meeting makes a lot of sense. Once that paycheck comes in, have a schedule for the money to go out those transfers to savings.
If you're contributing to your IRA away if you're paying bills that it's all set for the regular recurring expenses with those things taking care of you have some peace of mind you also freed up some time to focus on the more important things.
Whether that spending more time with friends and family kind of taken a step back and resetting and recharging or taking on an extra project whether that's at work because you're hoping to eventually get a different position and a raise or maybe it's giving back to your community.
Elle: Of course even if things are automated they're going to be times when one you need to just review and make sure everything running smoothly and then to take care of those expenses that vary month to month.
For example your cable bill might be the same but your power bill isn't. So how do you do that. How do you set aside time to review the numbers and also take care of the small things.
You probably know what I'm gonna say because you read the book or if you've been listening to the podcasts for a long time. But I am a big believer in having money dates.
Whether it's monthly weekly – I know some couples like to do it by paycheck -as long as it's consistent.
These are fantastic ways for you guys to have some fun relax as a couple and then yes go over the numbers.
Now if you haven't been on a money date before I will let you know the first few times are going to feel a little bit different.
How do you talk about money? How do you review things? But let's keep things simple. You establish the goals that you want to work towards and then you came up with a budget.
Your money dates for the first few times are probably going to be more emphasis on that monthly budget. How are things going? Is the budget you created realistic?
I'm just going to let you know. For most couples, your first budget is not going to be perfect and that's totally fine.
Key Takeaways on Tracking Your Financial Goals
Before we wrap up I want to focus on some key takeaways I got:
- Make it easy to know your numbers.
- Consistency is your best friend.
- Be wise with financial check-ups.
If you’d like to chat more about your financial goals, please join us in our private and free Facebook group – Thriving Families.
Hope to see you there!
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Like the music in this episode? Our theme song is by Gentle Regime. Additional music by Lee Rosevere.