RECAP- Couples And Money – Lessons Learned
Previously unmotivated in anything related to personal finance, Andy and Sarah feel differently now. Our conversations have sparked the couple’s new-found interest in getting smarter with money. Armed with some knowledge, behaviours and confidence, this young couple are well on their way to building a strong foundation for their finances.
Over the last five weeks, I’ve shared our discussions and ways for Andy and Sarah to grow their wealth larger and faster. Today, I’ll summarize. Likely, many of these strategies will work for you too. Wouldn’t it be great if 1+1 really did equal 3?!
1) Consolidate/Simplify Your Banking Arrangements and Credit Cards– Having money in fewer places improves cash management, reduces fees and simplifies banking as a couple. It can strengthen your negotiating power with your chosen financial institution(s).
2) Reduce Debt and Improve Credit– Consider accelerated payment strategies to pay off your mortgage (or other debt) faster. This will reduce interest costs and allow you to divert available cash to better use. Pay attention to and improve your credit rating to access the most favourable interest rates on current and future debt. Becoming debt-free will provide you with financial freedom to make different choices that you may not otherwise have.
3) Save Taxes– Find ways to divide income, defer taxes and increase deductions. Harness the power of compounding and tax-free growth of your investments, especially if your tax rates will decrease in retirement. Consider ways to reduce your lifetime taxes as a couple.
4) Maximize Investments/Retirement Assets and Manage Risk– Have complementary, not identical, investments to reduce risk and improve diversification. Take full advantage of the best corporate benefits/retirement plans that you can access including any “free money” (free money is like a guaranteed return; too good to pass up!)
Working together as a couple can produce better results than the sum of the parts. A joint strategy for saving, spending, investing and reducing debt allows you to grow your wealth more effectively. Money doesn’t grow on trees so stretching it as far as it can go really matters. Who knows, it could make the difference between a mediocre and a great retirement one day!
Read the 5 week series here:
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