When you enter into a relationship, you share good times and memories. Unfortunately, you also share finances. When you are in a relationship, having a joint budget will allow you to save money and work toward your future together.

Getting together and creating a working budget that you both agree on and stick to can be difficult, but it doesn’t have to be. Here are some tips to creating that budget, without stressing out.

Talk About Your Goals

The first thing you should do together when discussing your finances is sit down and talk about your savings goals. Think about the big picture: are you saving to buy a home, to travel, to have a child? Each partner should talk about what they want, and the end goal of what you are saving for should be something agreed upon.

Determine The Necessities

Figure out which expenses you absolutely need to pay each month. These include rent or mortgage, utilities, car payments, gas, groceries and any debts that need to be paid. Want to save in these categories? Consider clipping coupons, renting a smaller apartment or switching to a smaller car to save on gas and on car insurance.

Figure Out Your Financial path

There are many different types of relationships; and not everyone will have the same circumstances. When creating your own joint budget, you will want to take into consideration your own scenario. Here are a few examples of different money situations:

  • You both earn the same amount. Perhaps the easiest situation to deal with. You can simply combine funds and use both to pay for household expenses. When determining personal spending money, since both partners contribute equally, you can each have the same amount. If one person will get more spending money, it should be agreed upon by both of you.
  • One partner makes more. In this situation, it is important to not base your value in the relationship by how much money you contribute. It will take mutual respect and understanding to not allow the money situation to hinder the relationship. Instead of going in with equal amounts, go in with equal percentages. For example, both of you could contribute 50% of your paychecks to the household expenses. Obviously the one who makes more will contribute more, but it can help keep you on equal grounds.
  • Only one partner works. Like in the previous scenario, this one takes respect and understanding. However, it does work for many couples. Naturally the sole income-earner is responsible for the household bills. The spending allowances for each person should be given out by the income earner, but the amount should be determined by how much funds are left over.

Create Your Budget

Total your combined earnings for each month, and start subtracting your necessary expenses. If you don’t have anything left over, then you will need to go back and reassess your expenses. See if you can cut back on anything. If you have money left over, great! You can now determine a spending budget for each of you, or put it all into some sort of savings account.

Figure Out Individual Needs And Wants

Once you have determined the things that must be paid, you have room to discuss the things that each of you wants. This can be expenses such as a clothing budget, gym memberships, an eating out budget and so on. This area may prove hard to come to an agreement one, and may take sacrifice from both of you. It is important to discuss each other’s wants and “spending money,” and come to a compromise.

Decide How You Will Handle Your Money

There are different ways to manage your money. You can combine all the funds in one account that you will each use. You may also want to consider a cash envelope system, where you put the budgeted amount in cash in separate envelopes, and use only the allotted cash for each month. If the cash runs out, you either borrow from another envelope, or you will need to wait until next month. It is a more difficult method, and will require you to be strict with your money, but will force you to only spend what you have.

Track Your Spending

Keeping track of what and how you spend will let you know if your budget is accurate or if it needs to be adjusted at all. To keep track, you can use a budget app for your phone or even pen and paper. If you find your budgeted amounts were too little, either adjust your budget, or manage your spending to fit the original budget. If you find you are spending less than you thought you would, you can use the excess money to put towards a debt or into a savings account.

Creating a joint budget isn’t the easiest thing to do, but it is something that will help you manage your money and save together. Take a good hard look at your current finances, determine what bills must be paid and figure out a reasonable spending budget for each of you. If both of you manage to stick to the budget and make it work, you can look forward to less fights over money, more savings and less stress over the finances.

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