Till Death Do Us Part: Down To The Last Penny - Financial Tips for Newlyweds

Getting hitched is an exciting milestone. This means even more major life changes – perhaps a four-legged friend, a sleek car, a new home, or children are all things that you might share and experience. And what do all of these things have in common? A price tag and potentially some different financial points of view to navigate along with it.

Before marriage, most people manage their own finances and only their finances. Once married, the game changes from one-player to two-player. The phenomenon of conjoined finances is an unknown, foreign entity that all couples face in the early stages of matrimony. To navigate these new beginnings, keep these tips in mind:

Starting the Conversation: A common mistake that most couples make is simply failing to start the financial conversation well before any major decisions crop up. To be set up for success, communication is integral to planning for each life milestone. This conversation needs to be an honest one – discussing as many topics with your partner as possible. How much outstanding debt do you have? Looking to have children? Perhaps looking to buy your first home? Wanting to start a new business? The more you can plan for different scenarios, the better quality your roadmap will be. Certainly, over time your plans may evolve – but getting them off the ground is as simple as starting the conversation.

Choosing the Right Financial Planner: After starting the initial financial planning conversation with your partner, choosing a trusted advisor can help bring your plan to life. CPAs, attorneys, and financial planners can provide you with professional advice to serve your situation. Your options for picking the right financial planner are endless. If you’re unsure of who to choose, it’s always a good idea to connect with friends or family to receive trusted referrals. Don’t forget to plan ahead and have a list of standard questions to ask! Finding out how a potential advisor counsels people in similar financial or life situations, learning about their careers and more will help inform your decision.

Joint Bank Accounts: When evaluating your sources of income as a couple, it’s important to determine how or if you are both interested in joining your bank accounts. There are plenty of ways to organize your money with options ranging from opening select accounts, to keeping your income separate, to conjoining everything down to the last penny. It is advised that you and your partner consult a trusted financial advisor to determine which route fits your situation.

Life Insurance: Life insurance can be a critical resource should the unthinkable happen to you or your spouse. It’s important to understand the debt that could potentially be left behind in the event of a life-changing situation – which would in turn create an immense amount of stress on you or your spouse. Car loans, student loans, mortgages and any other outstanding debt are a few examples of obligations that must be accounted for as time passes. You also have to consider ongoing expenses that add up – from groceries and utilities to the overall cost of raising a child. There are many calculators accessible online to help determine the dollar amount that you or your partner would be expected to provide as supplement. When choosing life insurance, start with a level of coverage that covers your current obligations, then continue to evaluate the policy over time to determine how it may need to evolve to meet new needs. Your financial advisor can help guide your final decisions.

Sending Kids to College/Student Loan Debt: If you or your spouse has outstanding student loan debt – or you’re planning to help a child pay for college or pay down student loans, it is important to understand your obligations. Today, there are several ways to defer student loan debt and consolidate your loans into one select dollar amount. Plenty of apps can help assist you in finding a solution that fits your situation.

At the end of the day, the most important step to achieving financial readiness, is simply starting the conversation with your wife or husband. After all, that conversation will set the stage for every financial decision you make as a married couple.

======

Mark Thomas is a senior vice president with Aon Affinity, the consumer, association and group program business of Aon plc. He specializes in leading the operation, strategic alignment and growth of the industry leading American Institute of Certified Public Accountants’ (AICPA) Insurance Trusts.

Payroll