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Newly Married? Here are 5 Financial Tips to Plan your Future

RBL Bank Apr 26, 2024

As you start your new life together as a newly married couple, it is important to create a financial framework that aligns with your shared goals and dreams. Financially managing as a couple is not just about paying the bills; it is about building a life together.

By embarking on this adventure together, you are not only strengthening your relationship, but also setting the foundation for a prosperous future.

Let us dive into the world of financial planning for newly married couples. Whether you are looking to purchase your first home, plan for your family, or simply secure your financial future, robust financial strategy can make all the difference. With thoughtful planning and communication, you can embark on this path of financial growth and build a legacy that will last a lifetime!

Understanding Joint Financial Plan

As a newly married couple, it is important to create a joint financial plan. Aligning goals creates a road map for shared goals such as homeownership, education and travel, providing stability and personal development.

Open communication builds trust and understanding, enabling couples to make financial decisions together. By creating a space where you can talk openly about your individual financial goals and worries, you can create shared goals that align with your values and dreams. Not only does this strengthen your relationship, but it also ensures that you’re working towards the same financial goals. Building a solid financial plan as a couple prepares you for the challenges ahead. It also gives you the confidence to pursue your dreams together.

Benefits of a Having a Joint Account

Joint bank accounts in India offer several features that can be advantageous for various purposes, including for newly married couples. Here's a breakdown of the key features:

Joint Ownership: This is the core principle of a joint account. Both account holders (who can be spouses, family members, or business partners) have equal access to the funds in the account. They can independently:

  • Make deposits
  • Withdraw cash
  • Transfer funds
  • Issue cheques (if applicable)

Debit Cards: Typically, both account holders receive debit cards for easy access to cash withdrawals and online transactions.

Credit Cards: Joint credit card accounts allow couples to consolidate spending, earn rewards, and build credit together. They can benefit from shared rewards and simplified expense tracking while managing their finances responsibly.

Online Banking and Mobile App Access: Most banks provide features like internet banking and mobile banking facilities for joint accounts. This allows both spouses to:

  • Monitor account balance and transactions jointly
  • Make online payments and transfers

Nomination Facility: This crucial feature allows account holders to designate a beneficiary who will inherit the remaining balance in the account in case of the account holder's demise.

Enhanced Credit History: A well-managed joint account with a consistent record of payments on time reflects positively the creditworthiness of both partners. This can lead to better interest rates and loan terms.

Specific Loan Scenarios where Joint Accounts can be Beneficial*:

Home Loans: A joint account demonstrates a couple's combined financial strength and commitment, potentially leading to a larger loan amount and favorable interest rates.

Car Loans: Like home loans, a joint account can improve loan eligibility, especially for couples where one spouse might have a lower income individually.

*Having a joint account doesn't guarantee loan approval. Banks will still consider other factors like individual credit scores, debt-to-income ratio, and employment stability.

Building Emergency Fund

Establishing an emergency fund is one of the most important things you can do for your financial security, especially during times of economic uncertainty. Work together to identify expenses and set achievable savings goals that align with your priorities.

Use high interest saving accounts to store your money away from day-to-day expenses. With regular contributions, your emergency fund will continue to grow, increasing your financial flexibility as a couple.

Establishing and managing your emergency fund together gives you the confidence to face unexpected challenges, giving you the peace of mind that you have a dependable safety net.

Exploring Investment Avenues and Tax Planning

As a newly married couple, understanding the world of investment and tax planning is essential for your financial future. Not only do you need to explore different investment options, but you also need to strategize to reduce your tax burden and maximize your returns. By understanding how investments and taxes work together, you can make decisions that align with your financial goals and dreams.

Introducing Investment Options Suitable for Newlyweds: With so many investment options to choose from, it is important for new couples to find the one that best fits their risk profile, time frame, and financial goals. Whether you are looking to invest in stocks, bonds, real estate, or cryptocurrencies, there is no one-size-fits-all solution.

1. Investment Options for Newlyweds:

  • Mutual Funds: Diversified across assets, ideal for first-time investors
  • Fixed Deposits: Stable returns with low risk
  • Systematic Investment Plans (SIPs): Allows disciplined investing with small amounts regularly, benefiting from compounding.

2. Tax-Saving Investment Options for Couples:

  • Equity-linked Savings Schemes (ELSS)
  • Public Provident Fund (PPF)
  • National Pension System (NPS)
  • Deductions for home interest, health insurance premiums, and charitable contributions.

3. Stock Market Investment: Stocks are shares traded on exchanges like BSE and NSE. They offer high returns but carry market volatility risks, making them potentially rewarding yet risky investments.

4. Real Estate Investment: Real estate in India promises appreciation and rental income. While it demands upfront capital, home loans offer accessibility with favorable interest rates. Additionally, such investments provide tax-saving opportunities, making them attractive for long-term financial growth.

5. Gold Investment: Gold is a prized investment in India due to cultural significance and protection against inflation. Options include physical gold, gold ETFs, and government-issued sovereign gold bonds.

6. Insurance Coverage:

  • Life Insurance: Financial security for both spouses
  • Health Insurance: Access to quality healthcare without financial worries
  • Property Insurance: Maintains financial stability against asset loss or damage

7. Opening a Locker Together: Opening a locker together ensures security, transparency, and joint access, symbolizing trust and co-management of finances.

Planning for Big Expenses

Savings for major life events, such as buying a home or paying for a child's education , require careful planning and disciplined saving.

  • Start by setting goals and creating a savings plan that is tailored to your timeline and financial capabilities.
  • Streamline savings and reduce non-essential expenses to accelerate progress toward these goals.
  • Investing in higher-return options, like mutual funds and fixed deposits, can also help grow savings more effectively, making you financially prepared for major life events.
  • When considering a loan, it’s important to carefully consider your borrowing needs, repayment schedule, and interest rate. Compare offers from various lenders and negotiate favorable terms to minimize your borrowing costs. Opting for a loan with flexible repayment terms and prepayment options can give you more flexibility and control over your debt. By approaching loans responsibly and incorporating them into your overall financial plan, you can achieve your goals while maintaining financial stability.

One of the most important things for newly married couples is financial stability. With confidence and dedication, you and your spouse can start your financial journey together, backed by your bank’s resources and services.

Start your happy and blissful journey together with RBL Bank!
Visit www.rblbank.com for more information.

Disclaimer: Articles published on the website are merely indicative and suggestive in nature and do not amount to solicitation. The contents do not guarantee the desired returns and/or results. Reader is advised to exercise discretion and consult independent advisors for achieving desired result. Visitors to this blog/ website w.r.t products & services offered by RBL Bank Limited herein, shall ensure that the comments / feedback posted shall be restricted to the contents published herein and shall not contain such language that may be un-parliamentary or against any religion, caste, section of society, political view etc. While our endeavor is to publish the comments that are submitted, however, all comments/feedback shall be subject to internal review by RBL Bank Limited. We do not guarantee that the comments that are submitted will be published.

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