Monday, July 2, 2018

FINANCIALLY... WHO'S THE BOSS?





I have been married for 18 years now... and I must admit, there were a couple of times that money was the subject for major arguments.  Husbands and wives will agree with me, that if you don't create a financial plan as a couple, you will have a hard time surviving your marriage. 

Why?

Because we live in a society wherein: 
  • it is believed, that you are not only married to your wife/husband, but you are also married to your wife's/husband's relatives!
  • it is expected that you help your family (to some extent even distant relatives) financially out of utang na loob

If you want to eliminate financial stress, and achieve marital bliss you must remember:

Money matters are important things to be discussed between husbands and wives. I will always joke my husband -- hey, this is my rule -- "ang pera mo, pera nating dalawa. Ang pera ko, pang shopping ko"

We try as much as we could to discuss finances lightly. And to some extent, he agrees to my rule. Only because he knows, that i am kuripot.  So in reality, the rule becomes, "ang pera mo, pera nating dalawa. Ang pera ko, sa savings ang punta"!

That makes sense right?

It is also vital that husbands and wives know their financial responsibilities. My husband takes care of the bills. I take care of the grocery. We both contribute for mortgage. And since I earn more, I also take care of the teens' tuition.

That's another thing... if in case the wife earns more than the husband, the husband shouldn't feel insecure.  Because marriage is teamwork.  

We have also accepted our strengths and weaknesses when it comes to money. My husband is not a good saver. So, I am the designated taga-ipon.  I have the tendency to be super stingy, so Mr.Wise constantly reminds me to, once in a while, enjoy what I worked hard for.  That is our life's balance :)

Money Matters 101 from Mrs.Wise:


Make a budget.  You must set aside a specific amount for different expenses. Always prioritize payment for bills, tuition, mortgage, insurance.  These are non-negotiable expenses!

Save save save!   If you don't get the savings out of the way, chances are, there will be no more money left to be saved. And this is our formula.



Debt is allowed for acquiring assets. It is ok for mortgage or insurance or UITFs, because after you have paid it off, you will benefit from it.  You will reap financial rewards and security after you have paid it off. In mortgage, the property now becomes and investment. Same with insurance or UITF's.

Debt is also ok if you are purchasing an investment. Debt is definitely NOT OK to buy, cars,luxury travels, gadgets, shopping, etc. Debt can sometime trigger stress if you don't manage it well.

Always have an emergency fund.  And this is our formula for all the BREADWINNERS.  


The computation is based on my conservative estimate of my monthly expense, which is P20,000.  Multiplied by 12 months equals P240,000.

Then you add 0 ad that will be the amount that you should be saving for your family to continue enjoying and spending even when something happens to you, as the family's official breadwinner.

Of course that is a BIG amount to save now. Another option is to save that amount in INSURANCE form. You will invest a portion of your income for a couple of years, to hit the target. 


Question now. Is it ok to extend financial help to relatives?

This is a tricky question. But this should also be discussed between husbands and wives.
Our rule: Help within your means. Not shoulder everything and then leave you literally bankrupt!

Also, their is a hierarchy as far as who to support financially!  The ranking should be:  
  1. Wife/Husband
  2. Children
  3. Parents
  4. Siblings
  5. other relatives   
Why would you give to your relatives the money intended for your children's tuition? Or savings intended for your wife or husband's dream business?  You don't do that if you want marital peace. You get my drift?

I am not saying you should not help. What I am saying, know your limits and priorities.

So, who's the financial boss?


No one. Husbands and wives should always be partners in their endeavors. Should agree with every aspect of their financial plan.

As for Mr. and Mrs.Wise we are off to a new phase >> since our mortgage will end this year, we are now into the investment phase. Which includes, insurance (with critical illness inclusion because hey! we are not getting any younger)  We are soon meeting with our SunLife financial advisor  :)

And yes, after the insurance, we are off to travel plans. It's time to enjoy the fruits of our labor  :)

We'll keep you all posted. Hope this post inspires you to be financial savvy!