Start Planning For / My Family

Marriage means sharing your dreams. And, of course, your finances.

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You’re planning to spend a lifetime together. Successfully managing your finances is key to that plan.

Deciding to get married is the start of an exciting new chapter in life.  In addition to choosing the wedding venue and the flowers, make sure you focus on another important aspect of tying the knot – money.  The reality is, finances have to be discussed, and probably quite often. Learning, and possibly adjusting, each other’s expectations around the issues of spending, saving, and determining the major shared milestones in life can be critical components in the actual achievement of your dreams. 

Open up about your personal financial style before you get married

When you think about any long-term partnership, whether it’s business or personal, you’d likely want to know about a potential partner’s debt load, and moreover, you’d want to know the facts as far in advance of signing a contract as possible. If there were ever a time to be upfront about financial matters, marriage definitely qualifies as a critical time.  If you’re the type who routinely runs a large credit card balance, this would be considered vital information. Signing a marriage license will not transfer any of the responsibility for paying your debts over to your spouse, but it won’t wipe out the charges, either. When it comes to establishing any new credit lines on a joint basis, such as sharing a new credit card, your debt history will impact your partner’s credit rating. Depending upon your status, an unreliable payment record could make it much more difficult to obtain a mortgage.

This is a golden opportunity to take the issues in hand and see a financial representative to organize your finances – together. Do it ahead of time, and get things off to a nice start. 

Consider gradually merging your finances

One or both of you may already have a great career, your own retirement savings, credit cards, cash in the bank, and a strong credit history. You may already have kids. Giving control to your partner, especially if you have differing views on spending and saving, can be difficult. To begin with, consider a halfway measure. It might cost a bit more in fees, but, as an example, you could each keep your separate checking accounts and credit cards to start, and open up a new joint savings account that you both put an agreed amount into every month.  

When you’re ready, reap the benefits of togetherness

After successfully testing the waters, you can go deeper. For example, you’ll find that you can save on fees at most banks and brokerage houses – first, you’ll only have one account, and second, the larger the balance, the better the pricing. By joining your money together and letting the interest compound itself, you’ll watch money accumulate faster than you ever thought possible. Focusing on the bigger goals is a way to make them happen faster, and combining your resources and energy is the quickest way to obtain that focus.

Create a budget, and track it

The key to managing a successful family budget is determining what income is coming in, how you can meet your financial obligations, and how to simultaneously grow your bank balances to achieve major milestones. One useful concept is the idea of “paying yourself first.” If your job provides these benefits, payments toward the insurance and retirement plans you have chosen will automatically be deducted from your paycheck. After that, make sure your mortgage, home and car insurance, student loans, credit card bills, and non-negotiable, mandatory requirements are paid for immediately. The rest of your check can then be put toward regular living expenses. If you find a little leftover cash at the end of the month, spend the remainder on something enjoyable, or, if you’re a super-responsible type, make an extra payment into your retirement savings. 

You’ve got at least one other person in your life now, and more to protect

When you’re building a career and committing yourself to major goals like home-buying or raising a family, it’s important to be realistic about how far your assets could stretch.  Call it contingency: What would happen if things didn’t go quite as planned? If you weren’t able to work, for instance, due to sickness or an accident, would the mortgage continue to be paid? Or, if you’re a business owner, would your company survive a protracted, unexpected absence on your part?

Fortunately, there are ways to protect yourself and your loved ones in these circumstances. Options are looking at the benefits program you’re offered at work and contacting a financial representative. If you and your partner work for companies that offer benefits, it’s important to carefully compare the packages you each have available. Choose the best plan for you as a couple, and make sure you’re both enrolled before dropping the less desirable one. Make sure to not only check for insurance like medical, dental, and vision, but also disability income insurance to replace your income if you’re too sick or injured to work.

Now is also a good time to re-evaluate your life insurance. Look into the coverage you get at work and consider whole life insurance, a robust type of permanent insurance. It can help ensure that your new life partner would be financially secure if anything happens to you, and it also accumulates cash value, which is money that you can use during your future together. 

A bonus tip. Celebrate your progress.

Track your progress and make a point of treating yourselves when you reach milestones. How about a minor splurge at a nice hotel, for instance, or a set of concert tickets, or paying someone to place your photo galleries and movie clips into a personal feature film?

By combining your strengths, hopes, and dreams, and finding the right ways of making your finances work harder, you’ll have a much higher chance of achieving the goals you share together. Enjoy the new life you’re building and the shared future – it holds infinite, untold promise.