Budgeting as a couple is a touchy issue that most families struggle with. If well utilized, it can greatly boost your marital bliss. You don’t have to set up a joint account to carry out proper couple budgeting. Proper communication is the number one recipe for financial success between couples.

Several studies have revealed that only a few couples have a shared budget. For instance, the Fidelity Investment study showed that at least 40+% of couples couldn’t tell what their partners earned. If you are in this statistic that doesn’t reveal their finances, maybe it’s time to change. Carrying out more systematic budgeting as a team is a highway to financial freedom.

But it’s understandable why that is the case. Trying to bring someone new into your budgeting can feel odd. You’re afraid of judgment. But, if you have decided to commit yourselves to each other, there’s no point in sidelining. Whether you’ve started or want to start budgeting as a couple, this article is for you. We are going to show you the best approaches and behaviors you can adopt to keep things on the right foot. 

Best practices for successful couple budgeting 

1. List your combined incomes 

If you have been running parallel budgets in the house, it’s time to sit down and combine your thoughts. Both of you should reveal all your earnings to each other. Whether daily, weekly or monthly, and how much they fetch.

Next thing, write down the income and calculate the total house income. This should include every penny you get in the house such as bonuses, royalties, and interest. The total income of the house should be the main guiding factor during budgeting. 

2. Write down your joint expenses 

Bearing the total house income in mind, list down your expenses. The best way to do this is by putting your expenses in categories. These can be in groups like savings, entertainment, food, utilities, housing among others. You will realize that most of these are recurring categories. So, list everything from basic to wants. Even if you don't need an item within a certain budgeting cohort, include it in your standard budget. Or if you intend on buying something new, put it down. This helps to prevent budget shortages or underbudgeting. 

3. Estimate the item prices 

Now quantify your itemized list. Using market prices, estimate the prices of each item and the total cost. That calls for window shopping or asking your supplier the updated prices of the items.

When you want to downsize your expenses, you can take an average of your previous months. This will give you an estimate of how much you’ll need for your budget. Add the total cost and then subtract it from the family income. If the expenses exceed the income, you need to slice down your budget. Drop the least important things or reduce the number of unnecessary items in some categories. 

4. Track your expenses

Tracking your expenses tells you and your spouse whether you are faithful to your budget. Otherwise, you will drift away from your budget unknowingly. Committing to it is something else altogether. There are two main ways you can track the budget.

1. The first one is using the shared budget spreadsheets or templates. These are special worksheets where you can draw and track your budget. You can either host your spreadsheet in Google Drive or Dropbox where both of you can access it. From here, you will be able to refer to and edit the budget as time progresses. There are several online budget templates you can use today. Examples include; Clever Girl Finance, Google sheets, MS Excel etc. 
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2. Another way you can track your expenses is by using budgeting applications. There are tons of apps that will centralize all your funds and even categorize them. They are very robust and some of them will even notify you of the progress with your budget amount. If you want to keep a close watch on your spending, these are the go-to tools. Besides, you can connect all your sources of funds here and manage them better. If the updates are not automated, ensure that you carry out updates every day or at specified times. Top on this list are apps like Mint, EveryDollar, and personal capital app.

5. Review standing budget 

To succeed in this endeavor as a couple, communication is key. Have preplanned discussions about the budget with your partner to review the progress. During this time, make the discussion as engaging as possible. Give each other time to voice their opinions. You can also use this time to talk about the upcoming budget. This is when you discuss the weaknesses of the standing budget and how to fix that on the times to follow. Besides the planned discussions, you can also hold frequent talks about the budget. Give views on the ways to improve your budget and save more. So, don’t always wait to schedule a meet up to raise an important point. 

If you follow the above steps faithfully, be sure to have a watertight budget. We would also like to highlight a few dos and don’ts during budgeting. These are things you should pay close attention to when budgeting as a couple;

Do’s and Don'ts of Budgeting

1. Formulate the budget before payment: Being proactive and not reactive with finances is very important. For better and successful planning, you need to budget before payday. Otherwise, when the cash is in the account, it's very easy to get swayed by issues. Your judgment may be clouded by the prevailing issues. 

2. Correlate budgeting with income flow: Budget for the period until the next payment. If you are paid on a weekly or monthly basis, that should be the budget’s period. 

3. Your budget should never exceed your income: This is the rule of thumb. No matter how big your needs are, you should always keep your expenses below the income. If after planning you notice overspending, you have two options. You can either cut on the expenses or look for ways to boost your income. 

4. Track the budget as a couple: Keep each other in the know throughout this period. It is the only way you’ll be able to notice the loopholes and fix them. You also need to know how each of you feels about the budget. Also, your partner will act as an accountability partner to prevent overspending.

5. Communicate your plans: Always discuss your financial long term and short-term goals. You also need to share how you plan to achieve them. Try and harmonize your goals and if possible, start small. It doesn’t matter how much you’ll be saving for your planned goals. 

Final Thoughts 

Struggling with your finances as a couple? Maybe all you need is unified budgeting. Financial organization is always a key thing towards financial freedom. Not for couples only but for everyone. Above, we have provided top ways you can formulate the best couple budget. So, you have no reason to fail anymore. If you’ve already started, these are powerful tips that can propel you further in couple budgeting.

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