Single to Double: Money Management for Couples

Becoming a couple comes with a lot of compromises and discussions to get together on the same page when it comes to planning for the future and investing. Shortly after your wedding and honeymoon, reality sets in. When you start co-living and co-existing, you also start co-spending and co-saving. This may all seem a little overwhelming as you embark on this new journey. However, instead of shying away from your partner, adopt an approach that’s governed by absolute honestly.

When you get married, friends wish you to have joy and happiness in your marital life. However, a single word - ‘money’ can create a huge chink between spouses, owing to poor money management skills. If you can plan your money matters well, you can avoid any dispute with your spouse. 

Financial decisions are always better when taken together. Initially, couples may find it difficult to manage their finances due to differences in penchant for risk and priorities. This is common in most households, but, a couple should agree on having a budget and an investment plan to lead a financially stable life in future.

Budget Plan: Having a budget plan on spending is a must

Investment Plan: Discussing investment according to the financial commitment and risk capacity is a good idea, as each person will have their own interest and ideas of investment. Some individual are risk averse while some like to invest in risky assets.

Emergency Plan: Maintain an emergency fund where the funds are readily available on an immediate basis, to be used when one has taken a break from work or when there is no income from one of the couples.

HRA: If couples are living on rent they can split the HRA. This would ensure that both can claim HRA benefits under 80C of the Income Tax Act.

Insurance: Couples should have separate term insurance as well as health insurance which will take care of the expenses at the time of need.

Commotion of IPO Hysteria

With hullabaloo around the IPOs hitting the markets yet again following the trend throughout 2021, with the companies going public in a rush, a primary consideration is that a trend in the market can be a double-edged sword with the flip side risk commensurate to the upside potential. The motto in the investment parlance should be "You Win Some, You Lose Some". While India's primary market has attracted a lot of interest from the investors with more than 2X funds raised by firms on a Y-o-Y comparison between 2020 and 2021 (till end of Oct'2021, and several still tentatively lined up before the end of the year), not all who received allotment garnered a fortune.

Many investors have been searching online and consulting financial advisors for strategies and tricks - tracking GMP, putting through multiple applications through demat accounts held by friends and family, applying at the earliest possible from the IPO opening hours etc to improve the chances of getting an allotment in a ‘Good IPO’. However, these strategies seldom work in a highly unpredictable IPO market. No wonder, Warren Buffett said it right: “An IPO is like a negotiated transaction - the seller chooses when to go public but it’s unlikely to be at a time that is favourable to you.”

The real game analysis and predictability is built upon the capability to segregate the bad apples (over-priced, over-valued, poor quality business, and disastrous motivation for listing) from the right bets (growth prospects, business & industry stability, and future earning potential). Many times expectations and IPO price are too high to subscribe at the time of IPO. As a company takes some time to deliver on expected growth, impatient investors or investors with a myopic vision (just for profit making to make a few quick bucks) sell out. Investors who are optimistic of the changing situation and macro- or micro- economic factors that will or may influence the price movement, buy in or stay invested and benefit from any appreciation. Only savvy investors understand the meaning and value of being “patient” with companies which have long-term potential.