The early days of marriage are an exciting time of officially starting your life together with your new spouse. All of the stressful components that go into planning a wedding are over and you can breathe easily while reminiscing on your special first day as a married couple.
As newlyweds, you have much to consider financially—such as how or if to combine finances, whether to change or update insurance policies and other key documents, how to prioritize long-term goals, and more. Discussing key financial considerations with your new spouse may seem like the one of the least romantic ways to spend your time. However, this discussion can help you both get on the same page financially and start your marriage out in an even more positive way.
There are quite a few topics to weave into this discussion. If you would feel more comfortable having a professional lead the conversation, contact your financial advisor to set up a meeting.
Below are a few considerations that you will likely have to reflect on as a married couple:
Will you combine your finances? Will you retain any individual accounts? You and your spouse will need to decide how to manage both shared and individual expenses, along with how to best develop and uphold a household budget.
Do you or your spouse have outstanding debt? Whether it’s credit card debt, student loans, home loans or something else, you both should disclose this as well as your credit histories to provide a clearer picture of your overall financial health. This discussion is important to avoid any surprises when you go to make your first large purchase, such as a car or home, together.
If both of you receive health insurance coverage through work, is it wiser to have two individual policies or one family policy in place? Discuss all existing benefits or other insurance policies to determine if any would make more sense financially to consolidate rather than to retain two individual policies.
Both you and your spouse should review your wills (or create one if you have not already done so) to reflect your changed marital status. Any forms or policies containing beneficiary information, such as life insurance policies, retirement accounts and more, should also be reviewed.
If you have not already purchased your first home, is that something you both are considering for the near future? Consider whether buying a home is the best option and if so, how much you are able to put towards it and when is an optimal time to buy.
Is growing your family something you are both interested in doing in the future? Even if family planning is something that is a few years down the road, discuss if the current state of your finances can accommodate more individuals in the picture. If not, determine what steps need to be taken in order to feel more comfortable financing a growing family.
If you are planning on having children, discuss whether or not you as parents will fund their college education(s) and what that will look like. How much are you comfortable contributing? Which funding vehicles would you prefer to contribute through?
Do you currently contribute to a retirement funding account, either through your employer or individually? Review both of your contributions, investment strategies, diversification strategies, and more. Even if retirement seems like it is a lifetime away, it’s never too early to discuss your goals and determine the best strategy to pursue them.
Do either of you have other long-term goals, such as purchasing a second home, retiring early, starting a business, going back to school or something else? Be up front with your spouse about your goals and discuss how to prioritize these in relation to your other common goals.
Of course, you can always discuss these items and more with your partner before you walk down the aisle—in fact, that is often encouraged. However, we understand that planning a wedding is time-consuming and there often doesn’t seem like there is time to do much else beforehand. If time does not permit this discussion to occur prior to the wedding, set a time to sit down as newlyweds to go through these topics and more.
Depending on your specific situation as a couple, there may be more topics to consider financially. If you are getting married later in life or this is not your first marriage, you may have more complex financial items to discuss.
No matter your situation, a financial advisor is prepared to help you and your new spouse walk through what to discuss, update and keep in mind for your future together. Find a financial advisor near you here.
1829461 / DOFU 07-2017