It is critical to make sure that the wealth you acquire is available to the beneficiary when the funds are needed to achieve an important life goal. For example, parents who establish an education fund for their kid’s college education must ensure that the money accumulated in the fund is conveniently available when the child starts college. This necessitates that you carefully plan your investments. In this sense, two elements are particularly important: spouse engagement in investing choices and about the ownership and control of the investments you create.
Two brains are always better than one, especially when making financial investing decisions. As a result, you should consult with your spouse before making any family investing decisions. Even if your spouse isn’t familiar with the world of investing as well as you do, it is still beneficial to include them in those decisions. The more you know about investments, the less likely you are to raise obvious or fundamental inquiries about those investments.
Consider the case of bank fixed deposits. You may be able to foresee interest rate fluctuations. While you may be mindful about the FD tenure to choose to maximize profits, your spouse may propose that you invest your fixed deposits in smaller amounts and spread the maturity amount over multiple term periods. The reasoning behind this might be that having consistent cash flows throughout the year is preferable than having irregular bulk inflow at any given point in time.
Of course, including your spouse may be difficult if he or she is unwilling to participate in investing conversations. You must thus manage the other significant benefit of spouse engagement, which is to make them mindful of the investments. This reduces the likelihood of a third party defrauding your family of the money after your death. At the bare minimum, ensure that your spouse understands how much wealth the family possesses and where the investments are placed.
A fundamental approach for spouse engagement in family finances is by jointly controlling the family money. Another option is to hold in “either or survivor” option. By this way, one of you can continue to manage bank deposits and savings accounts after the other’s death. You can make your child the nominee for your goal-based fund investments and bank savings. But the key here is to manage your family’s money with your spouse so that both of you keep track of the family’s wealth.
