Music lyrists would have us believe that ‘even though we ain’t got money, I’m so in love with you honey’ is enough to guarantee a fairy tale future. And while it’s also true that money can’t buy love, it sure can ease the finances in a relationship. But for most us, financial struggles are an accepted way of life.
Marriage doesn’t only join lives, but bank accounts and debt, as well as to bring people together that may have different views on finance and money management. So before you pop the question to commit to a lifetime together, there are questions that need to be answered and issues that need to be addressed. Here are some things you should do before saying “I do” to prevent financial disasters after marriage.
Separate or Joint Accounts?
This is a vital question to answer so that you both understand who is responsible for what. Working with a joint account offers one large canvas to work on together and makes it easier to see a clear picture of the return on your efforts. Separate accounts are helpful for those receiving tuition reimbursements, child support and other money that needs to be accounted for. When dividing the financial obligations between partners, the responsibility of each partner should be clearly outlined and both need to be held accountable to the other by overseeing the management of all accounts.
Working Together on Debt
Many couples become engaged before they’ve paid off the debt they each have incurred while single. Trouble brews when one partner is carrying a larger amount of unpaid debt. So experts suggest that the debt-ridden partner work their debt down until the playing field is more level before combining the responsibility for those accounts. Once they become a mutual concern, couples should develop a plan to first pay down the highest interest rate account and work toward a debt-free lifestyle.
Planning is Key to the Future
This may be the hardest part of the financial future of engaged couples. Negotiations to create an agreeable budget between people who are accustomed to living independently require patience and commitment to the best interest of a future shared life, over and above personal needs. It also makes both partners aware of what’s in the finances instead of just one person being in the know.
To help bring spending habits more in-line with each other, begin by calculating the costs and discussing how bills will be paid. Both may contribute to the bills, but who will physically write the check to pay the bills, monitor the investments and take care of the taxes.
Putting in place a savings plan will foster teamwork and is essential in times of financial hardship. Decide how much you want to save as a couple, and do it automatically from your paychecks. Before walking down the aisle, a budget that includes everyday expenses, savings and investments needs to be in place with both partners in full agreement for the wellbeing of their life together.
Even though financial differences are among the top reasons many marriages end in divorce, you don’t have to be one of those statistics. Open communications and respect for differences of opinion will bring about the compromises that are a big part of married life. Get your financial issues right and you’re on your way to a long, happy life.
About The Author
Noreen Ruth writes for a credit card blog and several popular finance websites. She is interested in educating consumers about using credit responsibly and about legislative action that will affect their ability to borrow the money they need. She has contributed hundreds of articles to various online sites that provide content to educate consumers on credit card offers, debt management services, loans and other finance related topics.
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