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Is marriage the key to financial success?

Is marriage the key to financial success?

Australians who are engaged have the most positive outlook on their finances of any group in the country, a survey has found.

Of the estimate 460,000 Aussies who are planning to tie the knot, more than half expected their financial situation to improve in the next 12 months, according to a report by Roy Morgan Research.

While this could be for a number of reasons, from merging assets to halved rent or all the cash that will be received through wedding gifts, the fact remains that very few engaged couples think that their coming nuptials will have an adverse effect on their overall financial situation.

“Of course, other factors besides just a post-wedding windfall could be driving this optimism, including the fact that engaged people tend to be younger and on their way up in the workplace,” said Michele Levine, CEO of Roy Morgan Research.

“However even within each age group, engagement delivers consistently greater expectations of imminent financial betterment.”   

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Although for couples who are planning on having a child in that period of time as well the financial outlook was much less bright.

“Over one in five people due to have a baby expect to be worse off financially in a year—and men and women are equally worried,” said Levine.    

So if you’re planning on getting married and having a baby in the near future here are some steps you can take to make sure your finances don’t spiral out of control.

Figure out what your financial goals are

This is probably one of the most important discussions you will have with your partner about your future life together. This is where you will set out what financial success looks like to you and make sure you’re on the same page. Be prepared because you may find that you have very different views on what being “comfortable” means and how hard you want to work for your money.

Pay for the wedding with savings where possible

Starting your life together with a big pile of debt is a sure fire way to put added pressure on a new marriage. Instead, try and organise a wedding that can be paid for with the savings that you both have. This may mean some sacrifices are made when it comes to the more expensive items but think about what your priorities are. Will having an expensive dress and cake really be worth it when you’re stuck paying them off months after the occasion?

Talk to your partner about how you will cope with a drop in income

Having an open dialogue with your partner about financial considerations should always be a priority in your relationship but with a child in the near future there is one specific conversation that has to be had. With a newborn baby it is inevitable that one or both of you will need to take some time off work. Discussing this upfront and looking at how you could tackle this financially will save you the financial stress of having to figure it out on the fly.

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