The Money Couple Minute - Is It Time to Take a Risk?
What now? It's a question we are hearing from more and more couples as the recession takes its toll. Those who've lost jobs wonder what they'll do next. Those who've taken a major financial hit are trying to rebuild. Those who've weathered the changes so far are worrying if they're going to be the next casualties.But in the midst of these changes, many people see opportunity. Maybe that lost job means it's a good time to go back to school. Maybe the foreclosure means a chance to move to a new place and make a fresh start. Maybe the availability of stimulus loans makes it a good time to start the business you've always dreamed of.
This might be the right time to take a risk with your time and finances. But first you and your partner need to cover these bases:
- Measure your level of debt. A mortgage or car payment is one thing, but if your credit card debt exceeds more than 10% of your annual income, you should hold off on any financial risks. Instead, spend the next six months knocking out that debt then re-assess your plans.
- Weigh the pros and cons. Have a realistic conversation about how this new opportunity will change your daily lives-financially, socially, and emotionally. How will it affect your schedules? Will you need more childcare? Will you have to pull back on other commitments? How will this change your spending habits? Do you need to tap into other investments to fund this risk? What other financial sacrifices will you have to make? Only you can determine if these changes are worth it.
- Make sure you're both on board. If one of you wants to start a business and the other thinks you can't afford it, get creative about ways to get both of your needs met. Can you build your savings over the next six months so the new venture is less risky? Can you bring in a partner to ease the financial load? Can you break the idea into smaller, more manageable chunks? Risk Takers in particular need to make sure they have their partner's blessing before moving ahead with any new venture. Without it, you're going to bring anger, frustration, and deep resentment into your relationship. And no risk is worth that.
- Take your time. A good idea will still be a good idea two months from now. So before you make a major financial commitment to a new venture, take a deep breath…and wait. Keep dreaming, keep talking, keep saving, but don't make a move until you've let your plans simmer a while.
