Getting married is a huge step to take in a relationship. Although many couples quickly get consumed with the finer details – like booking a venue and choosing a cake – they should prioritize financial planning, too. After all, disagreements over money are one of the most common reasons for a marriage to end.
The Importance of Talking About Money Matters
Before committing to spending your life with someone, you should ensure you’re both on the same page about money.
Coming up with a solid financial strategy now can help ensure you’ll always be working together regarding money situations. Research shows that when couples make money decisions together, they’re more confident about their financial future, experience strong household financial health, and don’t view money as their biggest relationship challenge.
Creating a Financial Plan With Your Future Spouse
Depending on your upbringing, personal situation and education, you’ll have your own ethics, beliefs and goals about finances.
You’ll want to discover your partner’s financial priorities and then compare them with your own. Create separate lists and identify any areas that need compromise.
Discover Each Partner’s Financial Situation
You’ll also want to know more about your partner’s financial situation, like their personal assets, amount of debt and credit score. Figure out their expectations and spending habits and decide whether you want to combine your finances or maintain separate accounts.
Now is also the time to disclose if you’ve had a negative financial event like bankruptcy or want a prenuptial agreement.
Decide How to Pay for the Wedding
Even deciding how to pay for the wedding is a big conversation to have at this point.
Think about how much debt you want to carry from your wedding day into your future. Do you plan on using savings, a personal loan or other means to pay for the event?
You may need to reduce the size of your ideal wedding to make it more manageable. You could also explore non-traditional options, like holding the wedding during the off-season or at a smaller, more cost-effective venue, or even eloping.
Define Your Role
Next, define each partner’s role in the partnership regarding finances. How involved does each person want to be in handling household financial matters? Who will be responsible for the household budget, paying the taxes and paying the bills? Get clear about the particular aspects each partner will manage.
Plan for the Future
Talk about your future plans, like having children, emergency funds and retirement. Set long-term budget goals. Although they will likely require some discipline now, they should yield significant benefits later in your married life.
Partners with a life insurance policy may want to add more insurance as their family grows. If a partner lacks a policy altogether, they should explore getting one. Life insurance helps ensure your financial affairs are managed in the event of your passing, alleviating stress from your spouse.
Get Uncomfortable to Get Comfortable
Sharing intimate details about financial-related matters can be difficult and stressful, but choosing an honest, straightforward approach is best. There will be countless financial decisions during your marriage. You don’t want to experience tension later just because you initially neglected a tough conversation.
Keep in mind that money goals can change throughout a relationship. Commit to setting a regular time to discuss money during your future marriage – for 61 per cent of couples, that’s at least monthly. Use the time to track your progress and rework your financial plan when necessary.
The Financial Benefits of Getting Married
Marriage can elevate your living standard if you and your partner earn income. Monthly expenses become less stressful to pay, and there’s potentially more opportunity for savings.
You can also access family discounts on insurance policies and borrow more money from the bank. More benefits happen at tax time due to available income tax benefits and tax credits that populate when you marry.
Financial circumstances can swiftly change at any moment. If one partner experiences a job loss, death in the family, birth of a child, illness or another emergency leading to their absence from the workforce, there’s usually one remaining income to rely on.
And although you don’t want to think about it now, specific processes become simpler within marriages in the event of one spouse’s passing. For example, property can be transferred between spouses upon one’s death without requiring a lengthy and costly legal process.
Partner With a Financial Expert
Although talking about money in a relationship isn’t the most exciting topic, it’s essential. For many couples, working with a money expert makes these conversations easier.
SolveYourDebts can help you create a financial strategy, deal with debt, and receive credit counselling. With a solid plan, you can confidently enjoy financial peace – and anticipate a successful financial future together.
Contact us today for more information about our money solutions.
