Financially Ever After: Essential Steps to Take Before Saying ‘I Do’
Marriage is a beautiful partnership, and while love may be the foundation, financial harmony is often the glue that keeps things running smoothly. Before you walk down the aisle, it’s crucial to discuss and align on financial matters to set yourselves up for a strong and secure future together.
To-Do List: Preparing Your Finances for Marriage
- Share Your Financial History
- Exchange credit scores and reports.
- Discuss past financial decisions, including debts and investments.
- Set Financial Goals Together
- Identify short-term goals (e.g., honeymoon, first home).
- Discuss long-term plans like retirement savings or starting a family.
- Create a Joint Budget
- Review your current incomes and expenses.
- Allocate funds for shared goals and decide how to manage discretionary spending.
- Review Insurance Policies
- Assess life, health, and disability insurance coverage.
- Update beneficiaries to reflect your upcoming marital status.
- Establish or Update Your Will
- Plan for future asset distribution.
- Consider creating a living will or durable power of attorney.
- Decide on Joint or Separate Accounts
- Evaluate the pros and cons of merging finances.
- Agree on how to handle bills and savings.
- Meet with a Financial Advisor
- Get professional guidance on merging financial plans.
- Discuss investment strategies as a couple.
Unique Considerations for Different Life Stages
Financial planning looks different depending on your stage of life and marital history:
- Young Couples/First Marriages
Focus on building a financial foundation together. Discuss student loans, early career goals, and saving for milestones like buying a first home or starting a family. - Later-in-Life Marriages/Remarriages
Address pre-existing assets, debts, and financial obligations like children from previous relationships. Consider prenuptial agreements and how to blend financial strategies while maintaining individual security.
No matter your starting point, communication and transparency are key to navigating your unique situation.
Questions to Ask Your Partner to Know More About Their View of Money
- What does financial security mean to you?
- Understand their priorities and definition of stability.
- What’s your earliest memory of money?
- Explore how childhood experiences may influence current habits.
- How do you feel about debt?
- Gauge their comfort level with loans, credit cards, and mortgages.
- What are your thoughts on saving for retirement?
- Discuss expectations for when and how to prepare for the future.
- How do you decide what’s worth spending money on?
- Learn about their values and priorities in financial decisions.
- How do you handle financial stress?
- Identify coping mechanisms and areas where you can support each other.
- What would you do with a financial windfall?
- Get insight into their spending, saving, and investing preferences.
- How important is charitable giving to you?
- Discover their stance on contributing to causes they care about.
- What’s your dream financial scenario?
- Discuss long-term aspirations and what financial success looks like to them.
- How do you feel about financial independence within marriage?
- Understand their views on individual versus shared financial responsibilities.
Conversation Topics: Building Financial Transparency
- Spending and Saving Habits
- How do you prioritize spending?
- Are you a saver, spender, or somewhere in between?
- Debt Management
- What debts do you each bring into the marriage?
- What’s the plan for paying these off?
- Financial Roles
- Who will handle day-to-day budgeting?
- How will you make big financial decisions?
- Career Goals and Income Expectations
- How do your career aspirations align?
- Are there anticipated changes in income, such as returning to school or starting a business?
- Risk Tolerance
- What’s your comfort level with investments and financial risk?
- How will you approach decisions like buying a home or investing in stocks?
- Children and Education Savings
- Do you want kids? If so, how will you save for their future?
- Discuss education savings plans and associated costs.
- Emergency Planning
- How much should you save for an emergency fund?
- What’s the plan for handling unexpected expenses?
Conclusion:
Financial conversations before marriage can feel daunting, but they’re key to building trust and preventing conflict. By tackling these topics, asking the right questions, and completing your financial to-do list, you’ll lay a solid foundation for a future of shared goals and mutual understanding.
For more guidance on preparing for financial success in marriage, schedule a consultation with On Purpose Financial today!