When you say “I do,” many wedding vows have you agreeing to a lifetime of better or worse, in sickness and health for richer or poorer. The richer or poorer section of vows may seem silly to two (mostly) financially stable individuals tying the knot. But money can be a point of contention for many marriages. It’s important to take the time to discuss goals and strategies with your partner before the wedding day and then throughout the marriage. It’s a good idea to see where they stand and share what is important to you so you can get on the same financial page.
1. Make a Basic Budget
It may be an adjustment to go from thinking about “my finances” to “our finances,” but budgeting together can be the first step in a successful fiscal union. Whether you are moving in together for the first time or getting hitched, it’s a good idea to do the math to find your combined income, and then compare lists of your monthly expenses. This may be different because you are no longer in separate homes or different because you are finally aligning long-term goals.
Monthly expenses include those that are a must like rent or mortgage, utilities, insurance and food. Next, you should discuss what extra spending is important to each of you and make some decisions. This may involve compromises, but should be fine so long as you and your partner confer and agree on the bigger decisions. Any time there is a major change to your finances (a raise, a new child, etc.), it’s a good idea to gather again to review any changes this will have on your budget so you can make decisions together.
2. Talk About Retirement Savings
Planning for your future together requires calculating your retirement needs and making the investments to reach that goal. Coming up with this strategy may not sound like the ideal dream date, but you cannot afford to put it off. Evaluate where your individual nest eggs are at the onset and figure out how far you are from where you need to be. Then, talk about how you think you want to spend your retirement years, considering both the “what” and “why” so you and your partner can plan while also gaining valuable insights about one another. You can decide who will save what by figuring out what each of you is able to save through work plans like 401(k)s and individual investments to get the most out of every dollar in the long run. In an ideal world, you will each be maxing out your contributions and earning any available employer matches. It’s important to keep the retirement conversation going to make sure you are staying on track.
3. Compare Credit Scores
It’s important to talk about how comfortable you are borrowing money — and whether each of you has a credit score good enough to be offered the best rates. If someone has a poor score, it’s possible to devise a plan to help that spouse improve. If one of you is coming to the marriage with debt, it’s good to disclose that. If you use credit cards, you might want to talk about whether to make the other person an authorized user. However, you address it, getting and keeping a good credit score can help you get better terms — and pay less. (This lifetime cost of debt calculator can show you just how much you can save.) You can each check your credit scores for free on Credit.com to see where you stand.
4. Factor in Family
In addition to retirement, the future may include some family planning. It’s a good idea to discuss with your partner how many children you hope to have and what priorities you have for them. While your spouse may want to allocate money for certain sports or music lessons, you may feel strongly about attending private school. Plus, there’s always the idea of college savings. This can include helping your future offspring from running into costly student loans by having some (or all) the money set aside for college.
You may have some questions after you get married. What happens to all the work I have (or haven’t) done on my own? What if my partner doesn’t approve of my spending and saving patterns? Getting aligned on key points above and core financial values can help keep both your finances and marriage healthy.
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