The big day was perfect, the honeymoon was better still. You came home to a truckload of gifts and envelopes stuffed with money. The big question — what to do with all that cash? Tempting as it may be to go on a shopping spree for all manner of madness, instead, make the most of an opportunity to lay the foundation for a strong financial future together.
Fund your "life happens" account
Nobody likes to plan on things going wrong, such as your car's transmission going out or your pet swallowing a golf ball, but you need to have some cash in safe, short term savings to cover these types of emergencies, because it isn't a matter of if they will happen, it is only a matter of when. If you don't have anything in savings and an emergency does come up, you won't have any choice but to use a credit card.
Your ultimate goal is to have at least 3-6 months of your monthly non-discretionary spending in an account separate from your checking account. If you are not starting out with this, consider setting aside a portion of your wedding cash to start or add to your "life happens" account, advises Steve Repak, a certified financial planner and author of Dollars & Uncommon Sense: Basic Training For Your Money.
Quite simply, give yourself the gift of "peace of mind," says Lynn Ballou, managing partner of Ballou Plum Wealth Advisors.
Pay some bills
Money worries can kill a romance in a hot minute. Take advantage of the opportunity to kiss goodbye some of your troubles. Pay off all wedding expenses — you want the wedding to be a happy memory, not one of overwhelming debt that hangs over you for years, says Gail Cunningham, a spokesperson for the National Foundation for Credit Counseling. She also recommends paying off, or down ,all credit card debt each of you brought into the marriage — and at the very least, bring all past-due accounts current. "This will cut down on arguments about money," says Cunningham. [More from Forbes: 10 financial tips for starting a family]
You might think too, about designating some of the money for monthly student loan payments.
Invest in your home
If you own your home, consider using your cash to cover major or minor maintenance to make sure no bigger (and more expensive) problems arise down the road. In addition, these capital improvements can create equity. If you are still stuck with a high-interest mortgage, it may be worthwhile to look at refinancing and use the cash to help with those costs. If you rent and hope to own someday, the wedding cash is ideal to save toward the down payment. Couples might also find they need certain items for their new home, and can use the cash toward those. Just exercise caution — and keep to a budget, cautions Kevin Gallegos, a vice president with Freedom Financial Network. [More from Forbes: 20 crucial money questions to ask before "I Do"]
Save for the future
Save for retirement. If you two don't already have an Individual Retirement Account (IRA) or Roth IRA established, think about starting one, says Matt Armstrong, a financial planner with Savant Capital Management and also a newlywed. "You can also set your IRA up to systematically pull cash out of your checking account every month to help grow your retirement nest egg. For those couples with an existing IRA, fund it with up to $5,000 in 2012, if you are less than 50 years old, and an extra $1,000 "catch up" if you are 50 or older. Income requirements do apply. Also, don't forget to update your beneficiary information."
Enjoy a little fun
Says Repak, "I think it is okay, after you put some money into savings and pay down your debt, to take some of your wedding cash and spend it any way you want. Extremes seldom work and I have found that couples who have balance in their lives are happier. Spend, spend, spend will lead to poverty while save, save, save can lead to resentment. Be responsible with most of your wedding cash, but do set aside a small portion to spend on things you both like or things you both like to do." [More from Forbes: Wedding day confessions: Best advice for the bride and groom]