A marriage signifies more than just a union of two people. It is a lifelong journey that requires a loving, nurturing and trusting partnership. Ensure there are more ups than downs by preparing yourselves for the various aspects of marriage.
Your 1st Steps
Planning your wedding can be an eye-opener if it is your first major financial decision as a couple. While it may be tempting to throw a lavish wedding, you should remember housing and any other financial obligations you may need to upkeep in the present and near future.
Prioritising can help manage costs, especially when the to-do list appears to be mounting. Choosing what is necessary versus what you want can help you better manage your expectations and finances as a couple.
Here are some helpful ways to kick-start managing your finances together:
- Learn each other's money language – what are each other's spending and saving habits. Find the middle ground if one is a saver and the other is a spender.
- Draw up a joint budget. This will help you both track your spending habits and also allow you to introduce any necessary changes to improve your joint financial standing.
- Share the responsibility for household expenses as well as saving up for common goals like emergency funds an upcoming vacation or retirement.
- Do not make financial commitments without consulting your partner. Examples include purchasing a big ticket items such as a car or undertaking a guarantor position for a family member or friend.
For expert advice and tips on happy marriage, click here.Buying your Matrimonial Home
Buying your first home requires careful financial
planning and it pays to exercise prudence. As it is a long-term financial commitment, ensure that your
for the monthly housing instalment remains
affordable throughout the loan period.
If you are applying for a housing loan, your housing loan eligibility will be based on the Total Debt Servicing Ratio (TDSR)
, which is a computation of your total monthly debt obligations to your total monthly income. Do note that the total m
onthly repayment for property loans and other debt obligations should not exceed a Total
of 60%. Your monthly housing loan payment
should ideally not exceed 30% of your gross monthly income as well
Start your home purchase journey
ing Our First Home calculator
to estimate your housing affordability.If you plan on buying a Housing & Development Board (HDB) flat, you can make use of the Central Provident Fund (CPF) housing grant that is provided by the government as a subsidy for eligible HDB buyers. This can be used for the initial payment or to reduce the mortgage loan. Find out more on CPF Housing Grants:
Do note that w
hen you buy a HDB
flat and take up a housing loan using
savings, you are required to be covered under the Home Protection Scheme (HPS)
. The Home Protection Scheme is a mortgage-reducing insurance that helps to pay for your outstanding home loan should you become permanently unfit to work or pass away. Find out more about CPF and Your Home.
Making investments to enhance your savings
As you embark on this exciting journey with your loved one, you begin to build your hopes and dreams, one of which could be to retire comfortably. While your marriage may have started with significant expenses, you should look at building up your savings as a couple over time. One option is the CPF Investment Scheme. Do remember that all investments carry risks so it is important to exercise prudence.
Growing Your Savings
To help you grow your CPF savings and earn attractive guaranteed interest rates, you can consider making top-ups beyond the mandatory CPF contributions through a lump sum payment or regular contributions by GIRO. This can be through the CPF Retirement Sum Topping-Up Scheme, voluntary contributions or by transferring your monies from your Ordinary Account to your Special Account.
The Retirement Sum Topping-Up Scheme allows you to make CPF or cash top-ups to you and/or your loved ones'* Special Account (if recipients below age 55) or Retirement Account (for recipients age 55 and above). Topping up to the Enhanced Retirement Sum (available from January 2016), a sum set at three times the Basic Retirement Sum, gives you the opportunity to enjoy a higher monthly payout during retirement. You can enjoy tax relief of up to $14,000 per year if you use cash to top up for yourself (up to $7,000) and your loved ones (up to $7,000).
You can also make voluntary contributions, through a lump sum payment or GIRO, to build up you and/or your loved ones' CPF savings. Voluntary contributions to all your CPF accounts (Ordinary, Special and Medisave Accounts) are subject to the approved limit and do not qualify for tax deduction. However, voluntary contributions to your Medisave Account alone are tax deductible.
Alternatively, you can transfer the savings from your Ordinary Account to your Special Account
to earn higher interest. However, do note that this transfer is not reversible. You can transfer an amount up to the current Full Retirement Sum in your Special Account.
From 1 January 2016, you can transfer excess CPF savings above your Basic Retirement Sum to your spouse's account so that both of you can enjoy the benefits of the extra interest paid on the first $60,000 of combined CPF savings.
*"Loved ones" include only your parents, parents-in-law, grandparents, grandparents-in-law, spouse and siblings.
Dependants' Protection Scheme
Sometimes, life throws lemons at us when we least expect it. One good way to protect ourselves against the unexpected is with insurance, particularly if we are settling down.The Dependants' Protection Scheme is an affordable term insurance that provides coverage of up to $46,000
. The Dependants' Protection Scheme benefit will be paid out to you and
/your family members should you become permanently unfit for work or pass away. You can use the monies from your Ordinary Account
and/or Special Account or cash to pay for the annual premiums.For more information, click here.
lanning for your marriage marks the start of a new chapter in your
life. Be better prepared for your first home, children and other milestones through prudent decisions, financial planning
and managing your expenses carefully