Marriage is the most joyful thing in life. This is the stage which comes in everyone’s life when their bachelorhood ends and a new life starts where the newly wedded couples share love and joy for eternity. There are several factors which make a relationship healthy, successful and happy in many aspects like intimacy, commitment, love, care, and respect. Lacking, any of these factors can create conflict in your married life. There is one another factor which paves the path for a peaceful marriage is financial compatibility. Two partners must possess this quality as well. As with time, buying a mere thing is very expensive.

Finance has a great role to play when it comes to family life after marriage as you want to provide financial security to your partner and there are certain important things a newly married couple should consider.

Here are few important tips to ponder upon.

You must go through the formal financial planning process. It has three benefits. The first one is; it will help you formulate your life goals/dreams. The second, it will provide some basic knowledge about investing. And third, possibly more important, it will get you both to communicate and do all this together while you are still most in love (and willing to compromise). Love making, (future) kids, money – the causes of most marital problems. This is a start on avoiding money being an issue.

Investing is only one aspect of financial health and a good adviser should ensure your plan covers the other important things. For example, before investing, establish an emergency fund (3–6 months of your pay/salaries are common rules of thumb) in cash or near cash. Make sure your insurance situation is well throughout and in place. Disability insurance and life insurance become key requirements when you become pregnant (birth is too late, you are committed to conception).

But if that answer is too much-delayed gratification, here’s some general starting advice.

Mangalparinay will suggest you an automatic savings plan where a set amount gets transferred to your investment account every payday. This ‘makes’ you pay yourself first and ensures you prioritize savings.

The issue with small savings is the costs associated with buying investments can swamp the amount available to save. For that reason, low MER mutual funds (MFs) over ETFs (exchange-traded funds) – at first. MFs usually allow for quite low minimum purchases and there is usually no cost to purchase (remember though – NO LOADS! Also watch minimum holding period – why will become evident shortly). ETFs frequently have lower MERs but have an associated brokerage fee each time they are bought. You can get the best of both worlds by buying an MF throughout the year and then cashing it in (here is where holding period matters) once per year or so and buying an equivalent ETF.

Going through the process of coming up with a financial plan is very useful. It allows you to identify (often the hard part) and set goals, prerequisites for living (emergency fund, health insurance, disability and life insurance, etc) that need to be part of your overall plan, estimate scheduled savings goals (to track progress) and come up with a suitable asset allocation and savings rate that matches your needs and risk tolerance. Only then can you really decide on the ‘what’ to invest in since you should only assume the lowest risk necessary to reach your planned goals?

But as a general rule, you will want to invest in some percentage (of overall investments) in equities (fixed income may also be a part but at current interest rates you REALLY have to be risk averse to spend much time there). You should always be concerned about diversity within your investments to avoid a single security sinking the whole thing. (Watch out for employee stock savings plans – they are often a good deal but if that is the only thing you have then both your job and your savings depend on one company doing well.) That is why the ETF and MF should track a broad index.

One key to have enough money is starting investing early. It takes a lot less per month starting mid start it does starting mid 40’s as you have a family by 30’s and you have to spend a wide portion of money on your kid’s education, health insurances, and future dreams. Sit with your partner, make a timeline and put your goals on it. Then you will somewhat have a clear picture with time left for the events(goals). Try to give a monetary value to your events and back calculate using a real rate of return. You will get the actual lump sum amount you need today for the goal ahead in your life then you just have to invest your money according to the time frame.

Happy Investing!