Making financial decisions with your spouse

There is a high divorce rate all over the world and the problem is the lack of communication on important matters.

The key ingredient to a marriage is communication.

The issue of money is one of the key matters that has contributed to a lot of failed marriages.

Lots of couples hide their financial status, how much they earn every month.

The first thing is that as husband and wife, you should be open and honest about your financial status. This helps to increase the trust level for each other. When this is established you can now start with creating a budget.

Here are ways to create a budget with your spouse

1. Set goals

As a couple, you should have both short-term and long-term financial goals.

But be sure it does not affect your budget. Both plans and take a decision on what your short-term and long-term financial goals are.

2. Know your fixed expenses

Your fixed expenses are things you pay for monthly or yearly.

It could be the monthly electricity bill or the house rent you have to pay for every year. Make sure you know what your fixed expenses are.

3. Remove fixed expenses from net income

Subtract your fixed expenses from your net income. Your monthly income before removing tax is your gross income while your income after removing tax is your net income.

If you both have a net income of 200,000 naira at the end of every month and you have fixed expenses of 75,000 naira, means you are left with 125,000 which goes into savings and other expenses.

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4. Savings

After removing your fixed expenses from your net income, a substantial amount of what is left should be put into savings, which is in line with both your short-term and long-goals.

Also as a couple, it is best advised to have a joint account for big projects.

5. List Your Variable Expenses

Variable expenses might differ sometimes, as it is not like fixed expenses.

There are some variable expenses that are needed, like buying fuel for your car or getting cooking gas are necessary, while some are not necessarily important like going out shopping or eating out. List the important ones and decide if it goes well with your budget.

If it doesn't you would need to make some sacrifices which both parties have to understand.