Financial Advice to Help Newlyweds Get Through 2024

by Tamila McDonald
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financial advice for newlyweds

For many couples, the past few years have come with a range of unexpected financial challenges. High inflation, rising interest rates, and wages that haven’t kept pace put a strain on households. In turn, many newlyweds are concerned about their financial well-being, and many wonder whether navigating 2024 successfully is going to be possible. Fortunately, there are steps couples can take to set themselves up for success. Here is some financial advice for newlyweds to make getting through 2024 easier.

Pay Down High-Interest Debt

Paying down high-interest debt is always a wise financial move. By doing so, you can tackle the principle faster, allowing you to pay less interest over time. Plus, when you conquer debt, you free up room in your budget for other activities, including handling lower-interest debt, saving for the future, or other financial goals.

However, paying down high-interest debt could prove critical in 2024, especially if your interest rate is variable. There’s a chance that the Federal Reserve will increase interest rates more in the coming months. If they do, the interest rate on variable accounts typically moves up, too, causing your monthly payments on those debts to rise. By paying down the balance as fast as possible, interest rate increases are less impactful, decreasing the likelihood that they’ll derail your budget.

Take Advantage of Rising Interest Rates

While increasing interest rates on debt is burdensome, there’s also a positive side of the equation. Interest rates on savings accounts and certificates of deposit (CDs) are also trending upward, and that creates some opportunities.

If your current savings account isn’t keeping pace with the recent interest rate increases, now is an excellent time to make a change.  Explore high-yield savings accounts to find options with better rates, especially for stashing money that needs to remain accessible, like emergency funds. That way, any cash you’ve set aside is also growing as quickly as possible.  Interest can compound, here is an excellent example, so you’ll want to take advantage.

For money that isn’t needed right away but may be necessary in the near future, look at CDs. They’re generally low-risk and may offer interest rates beyond what you’ll find in high-yield savings accounts. Just make sure you can leave the cash in place until the maturity date, as early withdrawals usually trigger penalties.

Continue Saving for Retirement and Investing

In recent years, the stock market has been in flux, causing many people to worry about the value of their investments. At times, volatility can make newlyweds hesitant to stash money for retirement or to invest in general. However, for couples with time on their side, continuing to save in these manners is a smart move.

While it’s impossible to predict the future, many experts believe that the stock market will experience gains in 2024. Overall, the United States economy is relatively sound. Inflation is normalizing, and the once-predicted recession hasn’t yet occurred. Plus, if gains do happen, continuing to invest before the rise occurs means couples get to capitalize on the upward trend.

Still, it’s wise to examine your portfolio to make sure it aligns with your unique needs and preferences. Consider your risk tolerance, overall timeline, and various goals. That way, you can choose investments that make sense for your situation. Just make sure that diversification is part of that plan, as diversifying allows you to weather the unexpected with greater ease.

Continue Shopping Strategically

While inflation is far below its 2022 peak, it’s still a relevant part of the equation. Newlyweds need to remain strategic with their spending, particularly when it comes to shopping.

Ideally, it’s best to focus on essentials and make sure you’re reducing the cost of necessities as much as possible. Use grocery sales flyers, coupons, rebate apps, and loyalty programs to capture savings as often as you can. Additionally, use a shopping list and stick to it to avoid impulse buys.

Outside of the essentials, make sure you have a plan whenever you’re making a purchase. The cost of nearly every type of good or service has increased, so you need to ensure that your budget can support any kind of spending before you make purchases. It’s also wise to make comparing prices a habit before buying anything, allowing you to find the best possible price.

Build a Solid Emergency Fund

Even if your financial picture seems brighter in 2024, you need a solid emergency fund. There are still a lot of factors that can add unpredictability to the year ahead, so having money set aside is a wise decision. It gives you a stash of cash to navigate the unexpected, allowing you to avoid debt if circumstances change. Since interest rates are likely to remain higher in 2024 than in years past, being able to sidestep debt will make a difference.

Precisely how much you should set aside in an emergency fund is often a topic of debate. Generally, most experts agree that having at least $1,000 is a solid starting point. However, if that’s not enough to cover your auto and home or renter’s insurance deductibles, then aim for the total of those two amounts initially.

Once you have that much in savings, it’s time for a new target. Work toward having three months of living expenses set aside, giving you enough funds to weather more significant unexpected events, such as sudden unemployment. If you get that amount in an emergency fund, consider boosting it to six months of living expenses, as that can provide a lot of peace of mind and financial stability.

If you need to tap your emergency fund, start rebuilding it as soon as you address the situation. That way, you’re maintaining a critical safety net, ensuring an emergency down the road is similarly manageable.

Keep Your Housing Affordable

Usually, rent or mortgage payments are the largest part of a household’s budget, so keeping them manageable is a must. If you’re a renter and your new lease comes with a rent increase that could strain your budget, it may be worth exploring other options. While it could mean downsizing a bit, the move can help you keep your budget manageable, so don’t overlook the potential impact of moving to something more affordable.

If you are thinking about buying a house soon, make sure you have a solid down payment. High interest rates make mortgages far more expensive. If those higher payments are coupled with private mortgage insurance (PMI), then finding something affordable is potentially even more difficult. Fortunately, if you can put at least 20 percent down, you can avoid PMI, and that makes a difference.

Do you have any financial advice for newlyweds that can help couples succeed in 2024? Have you tried any of the financial strategies above and want to discuss your experience with others? Share your thoughts in the comments below.

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