Way back when I first got married, my husband and I were pretty young. We knew everything, you know, because we were young. I had always been fairly responsible with money, but I was known to put silly things on the credit card. My husband, love his heart, was not so strong in the money area. It just didn't click with him at first that even though ATM said he had money, the ATM didn't know he'd written a rent check that morning.
However, one of my biggest financial embarrassments happened right after we got married. We took over the payments for my husband's truck that his parents had been paying. I dutifully wrote out that first check and mailed it off, pleased in the knowledge that I was all grown up.
Two weeks later my husband received a tersely-worded, typewritten letter from his mother, saying the check had bounced, the bank had contacted her, and we needed to address this issue (in so many words).
I. WAS. MORTIFIED. I couldn't figure out what went wrong, I knew I had the money when I wrote the check. I would never have written it if I didn't. After scouring back through the checkbook I realized I had recorded the check as $14.70, not $147.00. Not realizing my mistake, we had gone on with our lives, I am sure we went out to eat a more than few times in those couple weeks, congratulating ourselves on our superior budgeting skills.
Times have changed since long ago - almost 25 years - but one thing we learned back then has stuck with us. We needed a way to know how much money was in the bank, what bills were on the way out, and when more income was going to come in the door. We needed a money routine.
Since that fateful day, I regularly schedule all our bills to be paid on either the 1st or the 15th of the month, whether they were due then or not. Here's the money routine we have set up and have stuck to, with a few tweaks over the years.
Pick a regular time to schedule or pay your bills
Our first taste of real income as a married couple was my husband's military pay, which kicked in a few months after we were married. We knew his military pay, when it started, would be hitting the bank account on the 1st and the 15th of the month, whether the month had 28 days or 31 days.
My civilian job, that I was about to leave, was on a two week pay cycle, meaning there are actually 26 pay periods a year, rather than the 24 we would have for his military pay. We needed to be able to plan for those extra few days in the month and to know that our financial obligations were addressed.
I still sit down, although now with my cell phone, not the checkbook, around the 27th and the 13th of the month to pay my bills. Anything due the 1st through the 14th of the month is scheduled to be paid on the 1st and anything due the 15th through 31st gets paid on the 15th of the month.
Any time we take on a new financial obligation, we look at our cash flow to determine the best time of the month for that obligation to hit. We have a lot fewer loans now than we did a few years ago, but we still consider the timing of anything new we take on.
Have a solo spending limit
No one likes to feel as though they are jailer and inmate and have no control over how the funds that come in the door are spent. We decided when we first married that we could each spend up to $50 without checking with the other first for approval, as long as we were sure there are funds in the bank.
Over the years, the "preapproval" amount has increased, but we still have an agreed upon number that we do not exceed without verifying with each other. It was about respect for each other as individuals, knowing we each had different priorities, and respect for our marriage and our common goals. It was important for us to check in with one another before putting our family in a potentially precarious financial position.
Share the burden
It used to be that I was the one that took care of the finances and my husband really had no idea what was going on. To the point that one time he was filling out paperwork and had to call me and ask what our rent was.
The last few years we have a financial date at least twice a year, usually around New Year's and Fourth of July. We talk about where we are financially, what are goals are, any major expenditures we have coming up or extras we would like to splurge on. One year is a was a week-long Jamaica vacation for our 20th anniversary, another it was planning for a basement renovation and bumping up my retirement contributions and the kids' college savings accounts. The goal is to share information, see where you stand on debt, goals, and plans for the future. One partner shouldn't have the burden of carrying financial security for the family alone, and no one should be locked out of seeing the full financial picture.
Three Steps, Lifetime of Communication
These three steps are the foundation of our financial life in our marriage. The money routines have served us well to make our finances predictable, allow for flexibility, and respect one another and our differing perspectives. Please give them a try and let me know how they work for you.
Erin Kidd is a 3rd generation military spouse, Accredited Financial Counselor (R), Enrolled Agent, and avid cook and eater. You can find her at www.taxladyerin.com and on social media @taxladyerin.