First Year Finances

Carefully Planning and Growing

Continued (page 3 of 3)

Beyond paying off student loans, the couple has some specific goals in sight. "We're slowly adding to our emergency account and have the beginnings of a down payment for a house one day," says Elisa. Why an emergency account? A baby is on the way. As for predicting the child's future, odds are there's a little saver about to join the family.

The Experts Weigh In

What stands out for Kaiser about Elisa and Patrick is that they've encountered unexpected expenses for which they didn't account when it came to budgeting. "Unexpected is a very common word that leads to stressful situations," she says. "It's not a situation unique to newlyweds, either. Everyone surprised by unexpected expenses."

When that happens, Kaiser says to stop for a second and consider the impact of the expenses. "It's really important to know from the very beginning when and how you will pay the money back," she says. "If you're dealing with a $1,000 bill for a car repair, it's probably going on a credit card." Using this method of payment can come with its own surprises by way of interest charges, so knowing the potential "real cost" is important. Says Kaiser, "Couples need to figure out how they're going to work through unexpected times, because they're going to happen over and over again."

Snyder has her own recommendations for the couple. "To avoid cooking arguments and the associated expenses of eating out, plan meals for the week in advance and focus on at least one to two meals that will generate desirable leftovers."

As for the children in the duo's lives, Snyder suggests this for the savings Elisa has set aside for her niece: "Put this college fund in a 529 college savings plan account, Coverdell Education Savings Account, or other similar vehicle to ensure the account is used for this purpose and to reap associated tax benefits."

For the soon-to-be addition to the family, Snyder says, "Take a hard and honest look at your budget and start revising now to prepare for additional expenses associated with a growing family."

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