Financial Planning Tips for Young Couples - IndianMoney.com

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Financial Planning Tips for Young Couples :

 

A couple may be compatible in many ways but if they fight over money matters a divorce is likely.

A money talk (Where the married couple discusses money) is very important.

Make a combined financial goal:

 

You (couple) needs to make a combined financial goal. You need to list your goals in monetary terms.

• Buy your own house if you are in a rented house.

• Buy a car

• Go on a holiday (Indian or abroad)

• Buy a TV ,Fridge or consumer durables

Plan for it:

Basics of financial planning for a young couple:

 

List your (couples) combined assets

• Your and spouses salary (or the salary of whomever is working)

• Income from an inherited property given on rent.

• Investment in gold, fixed deposits or shares/mutual funds.

List your (couples) individual /combined liabilities:

 

• Paying back the home loan EMI’s or the car EMI’s

• Going on a holiday

• Paying back a personal loan.

This is essential to avoid falling into debt (debt trap).

Avoid bad loans:

 

A personal loan availed for your (couples) extravagant spending (Going on a costly holiday abroad) can mess up your finances. This is a bad loan.

Availing a home loan is a good loan as you can rent the house in the future and earn an income. You also get tax benefits. This is a good loan.

If you avail too high a home loan and struggle to repay the EMI’s then it can be a bad loan.Always avail a home loan within limits.

Make a budget:

 

Remember a budget is made not to restrict spending but to plan on your spending.

Write your (couples) sources of income (salary, rental income, interest of fixed deposits).

List the expenses: EMI on loans, Grocery and daily expenses (Write everything including the maids salary).Sudden expenses like buying a TV or a fridge. Also include sudden and unexpected expenses (emergencies).

Once you know your income and expenses you can adjust your spending and save money and even invest it.

Insurance planning:

 

You (Husband) need to compulsorily avail a term life insurance plan. This would help meet the living expenses of your spouse in case something untoward happens to you (The husband).

Investment planning:

 

Choose investments which are compatible to both of you. If your combined decision is to invest in equity (stocks/mutual funds) where you get a higher return for a higher risk then stick to this decision.

If your combined decision is that no risk should be taken then invest in fixed income (Fixed deposits or bonds).

Tax saving:

 

Utilize tax deductions of Section 80 C and other deductions to avail tax benefits on your salary. Avail a home loan jointly (Husband + Wife) to get maximum tax benefits.

Avail tax deductions on a health insurance policy under Section 80 D. Invest in a PPF or an ELSS and avail tax benefits under Section 80 C.

This gives you (the couple) twin benefits of investment and savings on tax.

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