True love is priceless. But the wedding can carry a hefty price tag.
According to a 2016 survey that polled 13,000 recently married couples, the average cost of a wedding was over $35,000, excluding the honeymoon! Common reasons cited for the matrimony splurge were increasingly personalized events and creating the ultimate guest experience.
If you returned from your honeymoon to find that you’re both in more debt than you were expecting, here are some tips to help you right the ship.
Develop a Household Budget Based on Long-Term Financial Goals
Hopefully post-marriage isn’t the first time you’ve talked about finances, but in any case, now’s the time for you to both get on the same page. Factor in the wedding costs and the amount of debt (if any) each of you has.
Then decide on long-term financial goals. What type of retirement do you both desire? What kind of lifestyle do you want to be able to afford? How much would you like to have saved in one year, two years, five years, and beyond to make these things happen? Imagining your goals and trusting the plan to get you there should be all the budgeting motivation you need.
To ensure successful savings without feeling like you’re missing out on the present, develop a realistic household budget that practices discipline yet allows for some enjoyment. Be careful not to constrict yourself too much, though. Getting used to marriage is enough of a change without adding extra financial pressure on top of it.
Consider How Each of You Can Make Extra Money
Many people in debt look for ways they can save money to pay off more debt, often overlooking how they can make extra money as well. If you’re newlyweds without kids, you have more time to generate funds. How can each of you add to the monthly debt fund? Freelancing on the weekends, selling now-redundant or unused items, or even working a side hustle together.
Commit to a Debt Repayment Plan
Paying a monthly minimum or random total on a balance might feel like progress, but without knowing your overall balance and your plan to address it, that payment could be inefficient.
Write out each of your debt totals and their terms, such as interest rates, minimum payments and credit limit. From there, you can decide on strategies like the debt snowball, which prioritizes paying the smallest balances first to build momentum, or the debt avalanche tactic, which aims to focus on paying off the balance with the highest interest rate first.
Know When You Need Assistance
The DIY approach may be attempted first. However, some financial circumstances require more dire methods. If your collective debt isn’t budging with your repayment plan, debt relief strategies like debt consolidation or debt settlement may be effective. Consolidation plans take out a larger loan to pay off your various debts. This loan usually has a friendlier interest rate and simplifies the monthly debt repayment process.
If your debt is proving to be bigger than you can handle, debt settlement becomes a viable route. Companies like Freedom Debt Relief negotiate with your creditors to reduce your debt. These services may be able to help make debt more manageable and relieve some stress.
A new marriage brings much excitement and hope. By planning ahead early and paying down debt, you can have the financial life you both desire, and enjoy the journey getting there.