Saturday, February 8, 2020 / 08:00AM / Proshare Business
An Excerpt from our #WedInReport
For every wedding, the vision is a happy married life - the "happily ever after" as its often said in the movies. It's all a waste if, at the end of a glamorous wedding, the marriage turns to gloom. Though celebrating with family and friends is necessary, it is not sufficient to lose oneself and one's hard-earned money for a day or two when that same fund can be used to invest in the future. To understand this fact and focus more on the future, one needs to realize that the Wedding ceremony is about you and your spouse; thus, it is critical to managing friends & family properly. Your financial wellbeing after the wedding ceremony is very important hence ensures not to run into debts. Other steps that can be taken to properly plan your wedding ceremony and ensure it does not affect your marital life are explained subsequently.
It's all about you - Managing Friends and Family
Many couples dream of an ideal wedding that is glamorous while others are comfortable with whatever they can afford. Having a fairy tale wedding is everybody's dream to impress friends and family. However, not everyone can afford it; it could be financially prudent to make the right decision to downsize the events surrounding the day by working out a wedding budget that you can comfortably afford. Your family and friends will be happy for you; the bottom line is that you have achieved your goal; you are happily married and not in debt.
Project-based financing - Taxing the Troops
Other options could be to get financial support from family and friends, rather than going for a loan. In some parts of the country, it is the responsibility of the families to get involved financially to support the couple as the wedding is seen to be a "collaboration" between both families. Some parents go as far as getting gift items for the newly wedded couple to give them a head start. However, in the Western part of Nigeria, the richer family bears the lion's share of the budget, thereby reducing the expenses for the couple? The intended couple also gets support from friends and well-wishers.
Loans - Facing Market Opportunities with A Stern Eye
Though a wedding ceremony creates great market opportunities for many entrepreneurs and service providers such as wedding planners, caterers, photographers, etc., it can also be a missed priority if it is not well planned and managed based on a strict budget. There is a tendency for couples to go beyond their budget if they do not have a clear plan and if they do not know exactly what they want.
The budget overrun could lead to taking a loan to satisfy their fantasy of keeping up with the Joneses. Wedding loans are not good financial decisions, and it is not advisable to go into borrowing for newly wedded couples with average earnings. For instance, one is taking a loan of 5million naira at very high-interest rates to entertain 400people to eat, drink and make merry. You barely would get up to 50% of what you spent in return in gifts on the wedding account. The implication could be a difficult start to marital life. One burdened with early debt.
Some may argue that the couple may need to take a loan in order not to delay the wedding. The excuse of debt to fund a wedding is not valid; it is unwise to spend excessively to keep up appearances. It is not about the societal wedding ceremony but life after the one or two-day event, which is the marriage. The real challenge of a wedding is a marriage, which can take a lot of financial resources to sustain.
However, taking a loan for your big day can become necessary if you are sure that you will be able to repay it. But before taking a loan, several things should be considered. It is very important to work out how much you can afford to repay each month, as this will affect which borrowing option is best for you. If you must take a loan, choose the right type of loan for your situation.
Your Pocket and The Future
Marriage introduces changes in a new couple's financial situation that affect all aspects of their life together. Everything from personal financial goals to credit card debt will bring new challenges to the relationship. The new partnership also means new ways of managing personal finances, although many couples have questions about what to ask and where to start.
Understanding how to navigate through these changes isn't guaranteed to be easy, but planning can help you build a strong financial foundation for your relationship. The following are five key questions many couples ask, along with answers to shed some light on how you and your partner can best proceed with your financial plan.
One of the first questions newly married couples should ask focus on their bank accounts. Should you keep separate accounts or put everything into a joint account? Alternatively, should you have a combination of joint and separate accounts? Whatever you decide, this is an important issue to tackle as you begin your married life.
There are some good reasons to consider a combination of both joint and individual accounts. A joint account should apply to family expenses: mortgage or rent, utilities, bills, groceries, and so on. Both of you can add funds to this account so that you each have a share in paying to maintain your household. Also, each of you should have an individual discretionary account for personal spending or fun money. This arrangement can help simplify things when it comes to bills, yet it also helps keep personal spending in check without requiring you to compromise financial freedom.
The key to managing money successfully in marriage is good communication. Many couples find it hard to talk about money, which often leads to problems down the road. You may recall the stress that money can cause when you're single, so imagine how stressful it can be when you're married.
Don't let small problems or assumptions grow into large problems. From the outset, be open with each other and talk about your money concerns. If one of you is bringing substantial debt into the marriage, don't hide it. Be honest and come up with a plan for paying it off. No two people have identical values when it comes to money, so open communication helps to identify what is important to each of you. Then you can make the best decisions about your money as a couple.
Post Event Wedding Blues -Planning for the Day After
After the wedding, the journey of the rest of a couple's life begins. While a wedding is an event, a marriage is a carefully (and in some cases carelessly) designed series of activities that shape lives. A couple that wants to successfully and joyfully spend a lifetime together must plan their mutual path to happiness right before the wedding. The best way to enjoy a marital union is to take the pains of setting out a plan well before consummating the marriage. The precise and deliberate approach towards the marriage, as well as the wedding, would ensure that the day after the wedding fanfare will be just as exciting and eventful as the wedding.
With a pre-agreed post-wedding plan, the couple could settle quickly to meeting the goals set in their pre-wedding calendar. The schedule of events would include, but would not be limited to, the birth of a baby within a year and the preparation for the baby's creche and kindergarten education and expenses. The newlyweds would also likely arrange to acquire fixed and movable assets such as settees, smart TVs, refrigerators, air conditioners and kitchen utensils. The couple may decide that a car would be a useful asset to acquire early in the marriage as they share-ride their daily commute together from the house to their offices.
A newly wedded couple would do well to have a five-year plan. The five-year plan should be revised annually until completion. The couple could decide that after the initial five-year plan, another five-year programme/wedding milestone target is set out. The rolling plan approach towards marital happiness and stability ensures that at each half-decade, the family achieves set targets and improves its standard of living smartly and deliberately.
The Cost of Happiness Need Not Bankrupt You
Going into debt to get married is not a smart move. Since marriage is a journey and not an event going bankrupt to please the whims of others should not occur. A major approach to weddings should be from the perspective of a brief event along the much longer path of marital happiness. Very early in the relationship at the point of proposal and introduction, the couple must agree to hold onto as much cash as they can. Indeed, the target should be to conclude the wedding ceremony with a positive net cash balance or balance at the bank that meets a minimum of three months of cash flow needs.
While wedding loans are not unknown and have, in some instances, become acceptable ways of achieving social praise and respect, nevertheless, marriage is not planted on fickle sentiments. Indeed a wedding is a consummation of a social contract between two families and not a compact with a crowd of praise singers. Therefore, sticking to a life cycle plan for marriage allows each stage to evolve carefully to bring the couple to an expected goal of a happy partnership.
A couple on the verge of a wedding needs to be sufficiently clear-eyed and disciplined to avoid cash outflows that can be averted; the more money the couple saves, the better for the marriage. Many couples have started marital life on a harsh note as they allow themselves sucked into high-cost festivities at the expense of marital stability.
The wise route to follow, therefore, is to opt for a lean wedding (starting from the family introduction and ending with the honeymoon). The couple should stash up on cash or bank balances in preparation for the real journey, which is the marriage. Where family members and friends insist on extravagance, they should be encouraged to bear the cost.
The primary concern of a couple after the introduction of both families and the acceptance of the traditional gifts and bride price and the receipt of the marriage certificate from the registry is the financing of the first year of life together as a family. The running of a small family can be confusing for a young couple. The way to start is to draw up a budget that covers:
Pushing these considerations into the future will not make them disappear, the best way to handle them is to prepare. A dual-income family would, generally, find the responsibility of meeting the immediate marriage obligations easier to bear than a single income family. Nevertheless, both types of households would need to design expenditure and income templates that must guarantee fiscal stability in the first year as husband and wife.
The best time to work on the template is before the wedding so that required cash flows after the wedding can be anticipated and used as a guide to future expenditures. Indeed the template would control the size of the wedding outlay and the preparedness to go overboard with meeting social expectations.
A wedding should not be the enemy of the marriage; weddings should not break banks; people should NOT be victims of societal expectations.
The success of a wedding is not a function of the number of people that attended the ceremony. Success is also not portrayed by the uniqueness of the bridal train and the sophistication of the dance steps of the new couple. The hallmark of a successful wedding is a solid post-wedding bank account, an intelligent first-year spending plan and a life cycle model that guides a young couple's financial conduct. A wedding that leaves a couple bankrupt is the start of a turbulent marital relationship. Understanding the dynamic stages of a family's life cycle leads to the creation of a sustainable approach towards a satisfying, stable and fraternal marriage.
How well a marriage will survive the turbulence that life will present from time to time is a function of the preparedness of the couple to live within a disciplined framework of life, love and work. From the cradle to the grave, the family must structure an intelligent response to life's uncertainties and expectations.