Hey everyone! Nate and Heather from HackingYourBudget.com got married early and learned some incredibly important financial lessons in the process. Enjoy! ~M$M
My wife, Heather, and I got engaged when we were 21 and still in college.
We were married a year later at 22.
In that year before getting married, we graduated, moved in together, earned our first full-time jobs and merged our finances.
Sounds busy, right?
During that time, we were surprised that one thing that many people asked us about was whether or not we were going to merge our finances.
We were. And while it was a simple decision for us to completely merge our finances, we realized that wasn’t a given. It simply made the most sense for us.
And here’s the deal:
While everyone else was figuring out their finances on their own, we were able to learn together.
It wasn’t always easy, but 2 years later we’re in a better situation because of five lessons we learned together.
Two incomes are great, but only if you avoid lifestyle inflation
When multiple incomes, a raise or money from a side-hustle start coming into your bank account, the money available can be a welcome surprise.
Therein lays the danger though.
When you suddenly have more income, I completely understand the urge to start committing to more activities, outings, or buying larger items.
But it’s that excess money that is going to help you reach your financial goals, so it requires planning.
For me and Heather, dual incomes meant building a larger emergency fund and then beginning to pay down Heather’s $38,000 in student loan debt.
There are obviously many things that the extra money can help with, but in the end, avoiding lifestyle inflation gives you flexibility.
And consider this:
What happens when your income drops? Or when one of your two incomes goes away? How easily can you deflate your lifestyle?
While we have two incomes now, we know that down the road when we think of kids, we want the flexibility for my wife to decide if she wants to stay at home or not.
Therefore, we plan accordingly and make sure we aren’t making too many financial commitments even though we have the money to do so.
Financial accountability is easier with someone else
When you have goals, you often have to find ways to motivate yourself and track how you are doing.
Ultimately, you are looking for ways to hold yourself to your budget.
And early in our financial life, my wife and I learned to keep each other accountable.
I’m not talking about calling each other out for certain purchases or if we spent too much on a category.
Our accountability was built through transparency and communication.
We simply know what our budget is and understand that if we overspend on something, it puts both of us in a difficult position down the road.
Sometimes it’s OK to spend on yourself
Online, you hear grand stories of couples or individuals making incredible sacrifices to save money or pay off debt.
The dedication is admirable.
But for me and Heather, sometimes we want to enjoy a vacation, eating out at a new place or buying something one of us have had our eye on for a while.
We have our long-term financial goals, but we make sure that we still enjoy things (experiences, in particular) that we know we can afford.
Both of us are relatively frugal people, but when we know the other needs some encouragement to feel OK about spending some of the money we have built into our budget, we do so.
Communicating and dealing with money (even by yourself) is easiest when you start with your goals and have tangible numbers
Sure, we all know that communication is very important when dealing with finances. But you can’t just say “communicate more” and think that will work.
Nope.
First of all, ensure you are transparent with your financial goals. This helps properly frame all of your discussions once you have this set up.
Now, make sure you have tangible numbers to talk about.
With those numbers, you can have much more actionable conversations.
The following is a simple example, but instead of saying “You shouldn’t have spent that much on lunch the other day” or “We’re spending too much on food”, you could mention, “Hey we ended up spending $X on food last week which puts on pace to be $X over our budget for the month. I think we need to be careful about that and cut down on eating out.”
Adding context to our money talks helps us have more productive discussions and we come out with actionable things we can do with our finances moving forward.
Summary
Money can be a continuous issue. It’s the reason for a lot of fights in marriages.
But what many fail to mention are the great lessons you can learn when managing finances together.
You grow by helping each other and bouncing ideas off one another.
It takes work, but for us, being the anomaly and marrying young helped us immensely.
Bio
Nate & Heather blog at Hacking Your Budget, detailing actionable methods you can use to increase your financial flexibility. They’re in the midst of paying off $38,000 worth of student loan debt and continuing to learn as they go!
Comments
Maggie @ Northern Expenditure
We’re with you guys! We got married at 20 (yikes!) and 22. But I don’t regret it at all because we started our financial journey together. We were in college and had no money. So we learned together how to be frugal and set goals and align our finances. We figured out how to graduate debt free together. And when we actually started making money, we didn’t have to change our lifestyle or our finances to match someone else’s. We were already on the same path. And our relationship is so much stronger from having to deal with the struggles of life together at the beginning. Worth it.
Nate @ Hacking Your Budget
I love what you said Maggie, that by marrying young and learning together you don’t necessarily have to change your financial lifestyle to match someone else’s. You’ve essentially created your post-graduate financial situation together. Thanks for the comment!
Millennial Money Man
That’s an interesting take – I met my wife in high school, so I never had to change much in the way of finances (because I didn’t have anything)! I wonder what type of financial hit people that get married later on feel as they adjust to new lifestyles.
MB @ Millennial Boss
We are engaged now at 26 and 29 but have had “merged” finances since 23 and 26. We still have separate bank accounts but all of our spending is together (one of us pays the mortgage, the other utilities, we trade off on food, etc). The only thing we haven’t merged is student loan debt. Once we get married, I’m going to help my fiance get rid of his too (just eliminated mine). I know some couples keep separate finances but I don’t want to because I don’t want to enjoy financial independence without him!
Millennial Money Man
We have blended ours together now. It’s a little weird because my income is through my company, so a lot of it still stays separate.I think it’s a respect thing – I know people that don’t trust their spouse to see/handle the money. Kinda negates the purpose of marriage IMO.
WI Kate
We were 19 when we got engaged, and 21 when we were married, fresh out of college. Learned all the budget stuff together. We worked our butts off through college and graduated debt free. We also bought a house 9 months in to our marriage and dumped our savings in the down payment. After that we were broke, ($500 to our name) but living on love. We still live in the house (28 payments to go!) and we are still married.
Jason B
My wife and I got married at 20 & 21 respectively. She was in college & I was 4 yrs into a Naval career. We merged everything; 1 joint checking & savings; “my” income became “ours”; “her” student loan became “ours.” It wasn’t easy, but we got rid of “his” & “her” labels from the beginning & became a financial couple/team. I can’t imagine doing it differently.
Another thing that we did right for us was, even when my wife earned an income, we always kept our fixed expenses less than my income as a lifestyle ceiling. Her income was completely discretionary. I wanted her to work if she wanted to, not because she had to. That gave us the freedom for her to stop working when our first child was born & she could continue staying home guilt free when our second child was born with severe special needs. This self-imposed limitation gave us flexibility to adjust to unanticipated needs & Murphy.
Mollie
Married with two kids at 18, yes, at 18!! Husband worked a factory job while I took on debt and went to college – worth every penny so I could help provide a good income to our family once graduated. Still married in 2017 (over 16 Year’s now) and in 2016 we became debt free. Mortgage and my student loans became our last debts paid! Now we can contribute cash toward our savings, kids college tuition in the next few years, retirement, and also planning to pay cash for a vacation home at a later date! Tons of hard work and smart choices to live within or below our means, but ever since we merged our finances, it’s been 100% the best choice. Be content with what you have and don’t give a crap what the “Joneses” have because they are in debt up to their eyeballs!!!