Spend, Save and Invest Smartly

Financial Tips for Young Couples



A couple might be compatible in many ways, but if they fight over money matters, a divorce is likely. A money talk (Where the married couple discuss money), is very important. This will help couples align their goals and achieve financial compatibility.

How can a married couple achieve financial compatibility?
Make a combined financial goal

You (couple) needs to make a combined financial goal. You need to list your goals in monetary terms.
o Buy your own house if you live in a rented house.
o Buy a car
o Go on a holiday (India or abroad)
o Buy a TV, Fridge or consumer durables.

Plan for it

List your (couples) combined assets

o Your and spouses salary (or the salary of whomever is working)
o Income from an inherited property given on rent.
o Investment in gold, fixed deposits or shares/mutual funds.

List your (couples) individual /combined liabilities

o Paying back the home loan EMI’s or the car EMI’s.
o Going on a holiday
o Paying back a personal loan.
This is essential to avoid falling into debt (debt trap).

Avoid bad loans

A personal loan availed for your (couples), extravagant spending (Going on a costly holiday abroad), can mess up your finances. This is a bad loan. Availing a home loan is a good loan as you can rent the house in the future and earn an income. You also get tax benefits. If you avail too high a home loan and struggle to repay the EMI’s then it can be a bad loan. Always avail a home loan within limits.

Make a budget

Remember a budget is made not to restrict spending but to plan your spending. Write your (couples). sources of income (salary, rental income, interest of fixed deposits). List the expenses: EMI on loans, Grocery and daily expenses (Write everything including the maids salary),.Sudden expenses like buying a TV or a fridge. Also include sudden and unexpected expenses (emergencies). Once you know your income and expenses you can adjust your spending and save money and even invest it.

Insurance planning

You (Husband) need to compulsorily avail a term life insurance plan. This would help meet the living expenses of your spouse in case something untoward happens to you (The husband).

Investment planning

Choose investments which are compatible to both of you. If your combined decision is to invest in equity (stocks/mutual funds) where you get a higher return, for a higher risk, then stick to this decision. If your combined decision is that no risk should be taken then invest in fixed income (Fixed deposits or bonds).Your principal invested is safe and you get interest on this amount.

Tax saving

Utilize tax deductions of Section 80 C and other deductions to avail tax benefits on your salary. Avail a home loan jointly (Husband + Wife) to get maximum tax benefits. Avail tax deductions on a health insurance policy under Section 80 D. Invest in a PPF or an ELSS and avail tax benefits under Section 80 C. This gives you (the couple) twin benefits of investment and savings on tax. If every couple follows these methods a fight over money matters can be greatly reduced. One of the major reasons why couples divorce is lack of financial compatibility.You might be a good saver, but your spouse is a heavy spender. After a few years you will find your spouse spends everything you save. This will lead to fights.
Remember to check for financial compatibility before you get married.

Financial Planning
Tax Planning
Investment Planning