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 Fall is a popular times for weddings. If you're getting ready to say "I do," you are already experienced in making joint decisions. But in the midst of all of the romance, take some time to talk seriously about your financial future together. Money issues are one of the leading causes of marriage stress. Making sure both of you are on the same page before you walk down the aisle can help avoid problems once the honeymoon is over.
Don't wait until the week before you exchange vows to have a conversation. The Ohio Society of CPAs recommends setting aside some uninterrupted time before your wedding to discuss the following issues.
Do you share financial goals? These might include paying off college loans and credit cards in the short term and buying a home, having children, and starting to plan for retirement in the future. Once you've made your individual lists, prioritize goals together. This is the time to better understand each other's financial personality. For instance, is one person more of a spender while the other is a great saver? Knowing this up front can help you create a plan to manage your money that will keep you both happy.
Prepare a budget. Include all of your monthly income and expenses. The goal is to have money left over that you can put toward a joint savings goal. Consider this an expense and pay yourself first. Anything remaining is discretionary income that you can decide jointly how to spend.
Decide how it will be managed. Will one of you be the manager or will you both be sharing the responsibilities? If you both choose to be involved, make sure you decide on a bookkeeping system that works for both of you.
Will you merge your finances? Being married doesn't mean you have to become one financial entity. Credit cards, insurance and bank accounts can remain separate and in some cases, should. Explore any outstanding debt or credit issues each of you may have before you agree to merge your money. You may want to consider seeking credit counseling for tips on how to improve your situation so that you can work toward achieving joint financial goals.
Do you want a joint bank account? The advantage is that record keeping is easier because all money is flowing through one account. While you may have a joint account for shared expenses such as rent and utilities, some couples opt to have individual accounts too. This gives each partner some personal money to spend. Agree on how individual accounts will be funded and at what level. Make sure you pay joint expenses before you put money into individual accounts to avoid any misunderstandings.
Saying "I do" for the second time? Second marriages often have an entirely separate set of financial issues. If you are bringing children, property and assets to a new marriage, consider talking with an attorney to explore a prenuptial agreement that defines clearly who keeps what should the marriage end.
Marriage is a time of celebration and it's easy to delay talking about serious issues, like finances, until after the party. But if you get in the habit of approaching these discussions openly and respectfully, you'll pave the way for a stronger financial future and one in which you can both celebrate joint milestones achieved along the way.
- from ohioscpa.com
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