You’re Getting Married! Keep These 8 Things in Mind
Getting married is not a small feat for many reasons – among them, marriage represents a new stage in your financial life. Here are the financial issues soon-to-be newlyweds need to discuss.
How each of you views money.
Are you a saver or a spender? What about your fiancé? What goals do you have for your life together, and what part does money play in helping you to achieve them? Open communication is essential to any relationship, including a financial one.
How you’ll set up your bank accounts.
Many couples decide to set up a joint account. Others may choose to have one joint account for household expenses as well as separate personal accounts. That option may be better for couples with different spending philosophies.
How you’ll write/update your wills and beneficiary information.
Make sure you and your spouse are passing on your assets in the way that you want. In at least one case, a man’s ex-wife got his entire 401(k) after he forgot to change the beneficiary information. That kind of mistake is easily avoidable.
What kind of life insurance you need.
You may want to update your life insurance policy not just to help your new spouse, but also to help any children you may already have. In the event of your death, your new spouse could get assets that would have otherwise gone to your children. Life insurance policies allow you to determine the beneficiary or beneficiaries you want.
How you’ll determine – and stick to – a budget.
Online tools like MyMoney can help you keep track of your finances and make sure that your spending matches your priorities.
How you’ll deal with debt.
Credit card debt and student loan debt can hurt a new couple’s ability to save. Paying down your debts and staying debt-free (aside from a home) will help you lay a firm financial foundation.
How much you need to put aside for a rainy day.
It’s a good idea to have access to enough cash to sustain you for at least six months – some people are more comfortable with twelve. If you don’t already have an emergency fund, make it a priority; you never know when those rainy days might happen.
How you’ll save money for the long term.
As part of your open communication, have a conversation about how you’ll build wealth to enjoy your life together. Asking your financial advisor about a Roth IRA is a great place to start. Just remember that retirement can be a moving target based on your needs, abilities, desires, and the changing world around you. This is a conversation you should revisit throughout your marriage.