A ready reckoner to manage finances for would-be brides
In the age of social media, wedding planning has assumed new dimensions. From picturesque locations to photo shoots that look straight out of a coffee table book, to brides and grooms curating their looks in sync with each other to the most creatively designed wedding favours – the big fat Indian wedding is a festival in itself.
If you are a bride-to-be, it may be easy to get immersed in making meticulous arrangements for your D-day but taking stock of your financial matters before walking down the aisle should be on your priority list too. Yes, weddings are a dreamy affair and the joy of starting a new chapter in your life with the person you love is unparalleled. However, the mundanity of real life sets in pretty soon after the ink on your marriage certificate dries and the delicate bubble of harmony in the domestic front hinges majorly on finances.
Initiating a dialogue
Like with most things, the first step towards establishing clarity is an honest conversation and the sooner you have it with your partner the better. It is of paramount importance to know what your partner is bringing into the marriage and finances constitute a major chunk of it. In the case of women who are about to get married, seeking clarity about their partner’s financial situation is mandatory because in most cases, the women have to leave behind their families and sometimes even their jobs too to move in with their husbands and their families.
Neema Kakkar (name changed) works as an investment banker and has recently tied the knot with her childhood sweetheart. As an only child who shoulders the responsibility of assisting her family financially, Kakkar says her partner’s prior awareness about the fact that she would be sharing her income with her family and his unconditional acceptance of it has ensured the couple has never had to endure turbulence because of this. “In India, women supporting their parents and siblings financially after marriage has the potential to invite raised eyebrows from the in-laws. I have seen instances where husbands and in-laws have expressed inhibitions about the same after marriage, ultimately causing a major faultline to develop. In my case, the fact that my husband and I had been dating since ages set the stage for his acceptance,” she says.
Besides the question of supporting your family, you should also talk about how your partner grew up with money, advises Kakkar. “I knew my husband’s financial background, his approach towards money and his financial goals like the back of my hand. All this has a bearing on a person’s current attitudes towards money. Existing debt liabilities and spending habits should also be touched upon,” she says.
Prepping your finances
Yes, the courtship period is blissful and you would not want any worms of doubt to gnaw at you but as unpleasant as it may sound, there is no way to foresee exigencies in life. A certain degree of financial preparedness can mellow down the impact, should you ever find yourself in the unfortunate situation of your marriage breaking down or being left without any semblance of financial security due to death or illness. Also, considering that arranged marriages allow less room for a couple to fully familiarize themselves with each other, it is prudent to have your finances in order in case you are met with a rude shock post-marriage.
Kakkar says, “For women who have been in the habit of saving and investing, they should continue doing so and not get complacent because of the knowledge that now their husbands can take care of the finances. In India, where tradition dictates women to confine themselves to just saving and budgeting, many women find it hard to have the confidence to actively manage their investments without a man’s help,”
Learning to manage investments independently and having a portfolio before marriage is even more important in the case of women who are either not financially independent or do not have savings or investments. Kakkar emphasizes, “Would-be brides need to realise that a solid financial reservoir can be a lifesaver if they meet with any troubles after marriage. For those who are yet to start investing and are about to be married soon, mutual fund investments through SIPs can be a great starting point – short-term debt funds can provide stability and equities can aid in wealth creation for medium to long term goals. Liquidity objectives can also be fulfilled with mutual fund investments.”
Kaanan Ladha, CEO of Invest Aaj for Kal says, “In India, it is common for would-be brides to be gifted cash during their engagement ceremonies and on other occasions before the wedding by their family members. For those who are yet to commence their investment journey, a smart way to start would be to park in liquid mutual funds. Usually money received in the form of a gift is less valued simply because you have not earned it. It is how our mind works. So best is to map it to a goal.”
Ladha also suggests that instead of stocking up on a pile of gold jewellery, investing in gold mutual funds is more practical. “Brides these days have little fascination for heavy gold jewellery. For the purpose of investment, gold mutual funds are a better bet because unlike gold ornaments or bars or coins, there are no making charges involved and storage is not a concern.”
1. If you are new to the world of investments and are unsure as to what would be the right strategy, speak to a financial advisor who can choose the right products based on your risk-taking abilities and goals.
2. Do not underestimate the importance of budgeting when planning your wedding. It is easy to get carried away and before you know it you may have spent a large chunk on unnecessary items which can create a significant dent on your finances in the short term.
3. Learning to manage investments independently and having a portfolio before marriage is even more important in the case of women who are either not financially independent or do not have savings or investments.
4. For those who are yet to start investing and are about to be married soon, mutual fund investments through SIPs can be a great starting point – short-term debt funds can provide stability and equities can aid in wealth creation for medium to long term goals.
5. For the purpose of investment, gold mutual funds are a better bet because unlike gold ornaments or bars or coins, there are no making charges involved and storage is not a concern.
This article is part of the HT Friday Finance series published in association with Aditya Birla Sun Life Mutual Fund.