Financially secure marriage

Marriage season is round the corner and most of those whose marriage date has been fixed and eagerly making arrangements. All these arrangements do not come free, there is a cost involved for every action you take. When I speak to newlyweds, most of the time they are happy because they have gone into a new life or relationship from being single to being responsible for each other. On speaking on finances, most of them are starting their lives with zero or negative balance. Would you like to be one of those? I’m sure you would not, so it is better to make a positive beginning in your married life. First is be open on where each of you stand financially and how your expenses would be after marriage. This will give you an idea on what money you would have to spend for your marriage. This will set expectations right and you can keep any extravagant expenses at bay. Elders are important, but do not let them dictate your expenditure plans. Any major expenditure decision should be taken jointly, there will be a lot of emotions involved, in such cases, involve a sound elder who can give an impartial judgement.

Once married, keep your accounts separate, but add the other ones name, this is beneficial from tax point of view. For household expenses, keep a joint account where each would put in their contribution for joint household expenses. For all other personal expenses, savings and investments use your separate accounts. Even on account of credit card, try to keep them separate and one have one from household expenses, this will help in making payment to credit card companies as well. After marriage in most of the cases, there will be a change of address, ensure that this change of address is informed to all financial entities. In case of female, there is a possibility of name change, so keep your paperwork in order.

Get insurance into place, one is health, take a family floater and other is house. If you have taken a home loan then a term policy to cover the home loan. Marriage is a long term relationship so start thinking long term and start planning long term immediately. Though your responsibilities have increased, they will start increasing more and years pass, but on home front as well as job, so start your financial planning immediately. This will ease your financial burden in the years to come. Have a happy married life.

The need for insurance

When I talk to anyone about insurance, most of the time I get a question is what I will get back. This question really gets me thinking, because even after literacy increasing, people still do not understand the meaning of Insurance. Insurance is an indemnity is the event of something happening or not happening. So when you look at insurance, you should not look at return but look at what is the eventuality or outcome you are trying to cover. The following are some major insurance covers available:

Life – This cover kicks in only on the death of the policy holder. So while taking a life cover ensure that you cover only death and do not ask for a return of premium in case you survive the period. This cover is to be taken only if people are dependent on you for their living. So if there is nobody dependent on you, you do not need this insurance. How much cover is needed, depends on the assets and liabilities you will leave behind, so preferably contact your financial advisor to calculate the amount of cover you would require.

Personal Accident – As the name suggests, this cover comes into picture only in case of death or disability in case of an accident. You could take this as a separate policy or as an add on to the life policy.

Home – This policy covers the damage caused to your home and its contents.. Most of us are not even aware of this policy.

Health – With increased awareness, many of us have started taking this policy, but still I know of many people who avoid it, saying my employer has got me covered, but what if you fall ill in between jobs or you lose your job. Think, your whole life savings would go in a flash.

Travel – Most of us take this policy only when we are on official travel, but ignore it when we go on personal trips. We should never ignore this policy.

There are many other types of policies, some of which you buy, just because it has been mandated by the government or your loan provider. Most of these policies do not cover terror attacks, as you know the world has become a very dangerous place, so my suggestion is as the insurance company if terror attacks are covered, if not then ask them to add it. A little extra money, but you would have peace of mind.