The buds are in bloom and wedding season is in full swing. South African couples are taking advantage of the warmer weather to celebrate their commitments to one another. But while plenty of meticulous planning goes into the cake, the décor and the all-important guest list, many young couples fail to think beyond the big day itself. Debt may be looming.
According to a 2014-15 World Bank report, South Africans are the world’s biggest borrowers, and this is particularly true when it comes to matrimony, with many couples shelling out extravagant amounts for that perfect venue or highly sought-after photographer.
Caught in a Debt Trap
This can leave many a newly betrothed couple bogged down by debt during the initial stages of marriage, a situation that can be very difficult to escape from thanks to mounting inflation and the ever-present threat posed by currency exchange rates.
But there is hope for couples looking to have their wedding cake and eat it. Turns out, teaming up with a partner has its benefits not only in life, but also for your bank account. Simply by pooling resources and consolidating assets, you and your partner can look to dial down the debt, particularly when it comes to insurance.
So how can you benefit from a more collaborative form of financing? Here are a few things to bear in mind before saying ‘I do’:
By registering yours and your partner’s assets under the same insurance policy, you can enjoy significant reductions in your monthly premiums. For instance, should you have two cars listed on an insurance plan rather than one, you can save over 25% on the cheaper premium, a discount that can represent a significant saving. Equally, by merging car and household contents insurance policies, you’ll be able to score similar discounts on the cheaper of the two.
Keep it current
Moving in together for the first time? Now that all your assets are under one roof, it’s important to ensure you list them under a single insurance plan, which could earn you significant premium reductions. It’s also vital that you update all relevant contact information and details of security arrangements, as the specifics of your new abode can have significant implications for your policy. For instance, if you’re moving from a free-standing home to a security complex, your lowered risk profile could mean reduced monthly premiums. So make sure all your information is up to date if you want to cut back on unnecessary expenses.
While envisioning an ending at the very start of a marriage might be difficult and unpleasant, it’s important that provision is made at the outset in the event of the death of either partner. Life insurance is a critical consideration for any married couple, as it can pay for funerals, estate taxes, settle debts, replace income, pay various expenses and provide a lump sum to cover living costs should circumstances require.
This becomes doubly important in the event that you’re looking to start a family, as it can provide a critical financial lifeline to children should either parent pass away.
While much emphasis is placed on the importance of the wedding day itself, it’s the days that follow that are most important for any married couple. As such, it’s vital that every marriage is entered into with eyes wide open, and with a keen understanding of the financial responsibilities and benefits that it entails.
* By: Nthabiseng Moloi, MiWay Head of Marketing & Brand at MiWay
MiWay is an Authorised Financial Services Provider (Licence no: 33970)