Your Life

Quick tips to improve cash flow and manage your money as a couple

- September 20, 2019 2 MIN READ

While global surveys show Australians have never been wealthier and our household finances are in the best shape for years. If that’s the case, why is it so hard to make ends meet?

Retirees and families are feeling the pinch because while their assets (superannuation and property) have been rising in value, interest rates are low and wages haven’t been rising. In other words, we may be asset rich but we’re cash poor.

Here are some quick tips to improve cash flow:

1. Reduce Expenses 

The easiest and quickest way to increase cash flow is to take a look at current expenses and find ways to cut them. 

Track spending, draw up a budget, and see what can be reduced. You’ll be surprised. 

2. Sell (Some) Assets 

If it comes down to it, remember you can always sell some assets to free up cash flow. Some are much easier to liquidate and carry lower transaction costs than others, so shares and physical assets work much better than property here. 

3. Find Additional Income

If it’s possible, bring in more income to ease the cash crunch. This might mean a gradual transition from full-time to part-time work for those ready to retire. Or for mortgage holders who are finding it hard to pay bills on time, picking up extra hours, asking for a pay rise or working a second job. 

Manage Your Money As A Team

Financial pressures can put a strain on any relationship, so it’s a good idea to regularly talk about money with your partner.

Here are five tips to help you manage your money as a couple. 

1. Be Open About Money

Build good habits and be open about money early on. 

You should be able to trust your partner with knowing your financial situation, and it will help prevent problems down the track. 

2. Understand Each Other’s Values And Goals

It’s important to be honest with each other about your financial values.

Once you’re on the same page it makes managing money so much easier, from the everyday issues to big life decisions. 

3. Line Up Spending Habits

To avoid arguments over money, make sure your spending habits are compatible. A budget will help to create a bit of discipline. 

4. The Joint Account

A joint account can make the process of managing money together much easier.

Make sure to have a fair system for allocating money to the account, and don’t abuse it for personal purchases.

5. Don’t Be Financially Ignorant

Each partner should have a basic understanding of money.

Start by taking an interest in the financial news, and for more complex issues it can be helpful to see a financial planner together.

I’ve come across a couple of great new tools to help your kids on their journey to understand money. Here, take a look…