For Richer Or Poorer?

Paying attention to budgets and investment strategies can help new couples mature with dividends

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Dectrick And Paula Jenkins tied the knot just 29 months ago, but the newlyweds are already planning how they can spend their golden years comfortably. The couple–he’s 28, she’s 29–hope to retire by the time they’re 50 with a net worth of at least $1 million. By acquiring real estate, investing in stocks, and aggressively eliminating debt, they plan to make their dreams a reality.

To reach their goals, the pair is taking action now. They handle the household budget together, splitting their paychecks to cover recurring bills and accumulate savings. However, Dectrick, a quality engineer at Pre-Finish Metals in Elk Grove Village, Illinois, is in charge of eliminating debt and vacation expenses, while Paula, a business analyst for Hewitt Associates in Lincolnshire, Illinois, focuses on building nest eggs for investment and retirement purposes.

“It’s important for us to put together a plan now, because the earlier you begin, the better off you are long term,” says Dectrick. “Plus, there are numerous goals that we want to achieve, and motivation, not procrastination, will be needed to achieve them.”

If you truly want your married life to be for richer not poorer, take your finances as seriously as you take your vows. Iris D. Atkinson-Kirkland, a financial management consultant and debt management expert in Hempstead, New York, says that for young married couples, saving for retirement requires discipline and a solid investment strategy. Creating a financial plan before marriage or shortly thereafter can help couples discover the differences, as well as the similarities, in each other’s approach to money management. If one spouse is a spontaneous spender and the other a savvy saver, a discussion of each other’s financial goals and expectations should take place. If both are spenders, a careful evaluation of spending habits should be noted and corrections made, because such habits could quickly bankrupt or break up a marriage. If both are savers, the couple should discuss which investments will be made in order to make their money grow. Atkinson-Kirkland stresses that these matters be dealt with quickly in order to avoid money problems later.

To stay on track, the Jenkinses are using a model suggested by their financial advisor. Freddye Smith, a certified financial planner at the financial services firm of Waddell & Reed in Chicago, suggested the couple employ “the $50 rule” when using credit cards: if a purchase costs more than $50 walk away and consider if it is really needed. Smith also advised them to pay off their $22,000 student-loan debt. They own two cars (one is paid for), and have no plans to make more than one car payment.

“This model will free up money for other items, reduce our debt, and increase our net worth,” says Dectrick.

On the asset side, the newlyweds invest in 401(k)’s; they both have company stock and profit-sharing plans, and they’ve both opened their own personal brokerage accounts. They’ve even started an investment club. With a household income of $95,000, they plan to continue investing aggressively and strive to cut their $14,000

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