Have you ever wondered what is causing all of the divorces in our country these days? We mean, seriously, a full half of all marriages ends in divorce, usually within the first seven years. And second and third marriages actually have a higher divorce rate than first marriages (so much for the “it was just because we were young and dumb” theory). What do you think is the leading cause of divorce? Cheating spouses? None, that’s second place. “Just can’t get along?” You’d be surprised how far down the list that one is. The number one reason people get divorced in America (drum roll, please) is because of financial problems like too many personal loans that they didn’t budget for.
Don’t get us wrong. This isn’t a crusade against the lending industry. Loans, kept in proper perspective are a necessary part of living in today’s world. The problem comes when we take out loans that we can’t pay for. Lending companies will actually try to prevent you from doing this. The problem is, they have matrixes that are based on what they perceive average expenses to be, and no couple really fits into the exact molding of an “average couple.”
A budget is the best protection your marriage has from financial problems. In most cases, they are simple to make. Figure out how much income you have. Figure out an amount to give to savings (typically 10%) and how much you want to give to charity or your church of choice (believe it or not, studies have shown that those who regularly give charitably do better financially than those who don’t).
Next, figure out how much you can afford for housing. This should be no more than 25% of your income and should include your mortgage or rent, utilities, and related housing expenses. Then figure out how much you have to spend for transportation. Experts argue about what percentage you should dedicate to this and the rest of your expenses.
Truthfully, it doesn’t matter what percentage of your budget goes to each item, as long as you are agreed on a percentage, and at the end of the day your budget doesn’t equal more than 100% of your income. The next part is the hard part: sticking to your budget.
Sticking to a budget may mean saying no to the “better” car you were hoping to buy, or saving for some things instead of using personal loans to get them. In any case, it’s better to have a used car and a happy marriage than a brand new car that gets fought over in the divorce settlement.
Photo via gui.tavares