Are you recently married and hoping to avoid the financial missteps that so many newlyweds make? Fortunately, just knowing about some of the common money-related pitfalls is all it takes to ward them off. However, there are a few errors that are deceptively challenging to deal with. In addition to all the misinformation out there about joint bank accounts, one of the top newlywed glitches is forgetting to plan for the college expenses of yet to be born children. Likewise, far too many young married couples don’t fully realize the importance of maintaining excellent credit scores.
Rounding out the list of most frequent financial fallacies are two others. One is related to the erroneous belief that you will never purchase a house. Some die-hard apartment dwellers think this way. The other is assuming that you don’t need expert financial guidance. Here are more details about how recently wed couples can get their fiscal lives in good order.
The Joint Account Trap
One of the grand old myths about bank accounts is that married couples should only maintain joint accounts. At one time, long ago, that rule made sense. Today, it’s actually very damaging advice. While it is a good idea for both the man and woman in the married couple to share a joint bank account, they should each have their own accounts as well. The way credit bureaus work means that each member of the couple should have both a checking and savings account and make regular deposits and withdrawals. This kind of activity helps both husband and wife maintain good credit scores.
Not Planning for College Expenses
Unless you’re absolutely certain you’ll never have children, it’s wise to plan for their college expenses as soon as possible. Long before their arrival into the world, you ought to be thinking about how you’ll cover the high costs of education. For college, many men and women choose Earnest parent student loans to ease the burden of graduates’ financial obligations. The great thing about parent loans is that they don’t follow new grads because you, the parents, are the borrowers. Called Private Parent Loans, the arrangements allow you to cover any amount of a child’s educational expenses as you wish.
Ignoring Credit Scores
Credit bureaus rate individuals, not couples. Husbands and wives should periodically check their scores, utilize debt solutions that work, pay all bills on time, keep credit card usage at or below 20 percent, and correct any errors that appear on official bureau reports. Ignoring scores can mean that mistakes, which do happen, become an embedded part of your rating and are harder to remove later on.
Assuming You’ll Never Buy a House
Even die-hard apartment dwellers should plan for eventual homeownership. Even if you don’t ever purchase a house, it’s smart to assume that you will. That way, you’ll build up your credit scores, save more, and generally make yourself more financially stable. The fact is that 90-plus percent of all married couples eventually buy houses at least once in their lives.
Thinking You Don’t Need Expert Help
Unless you’re a licensed financial planner or CPA (certified public accountant), seek professional assistance with long-term planning. Every couple should do this, no matter what their combined income. Newlyweds often ignore this crucial step and end up squandering capital and missing out on excellent opportunities. An expert can show you how to leverage your income and age to get the most out of insurance policies, save for a home, plan for all the expenses associated with raising children, and build a substantial retirement savings account.