10 Financial points of discussion before you marry
It’s definitely a lot of fun to discuss the details of your wedding plans, but how about the not-so-exciting topics? One of these is your personal finances, and how you are going handle financial matters as a couple.
In a survey that was conducted by the National Foundation for Credit Counseling, it was found that there are about 68% of engaged couples who had negative reactions when it came to discussing money and finances with their partners. There were even 5% who said that having such discussion could push them to call off the engagement.
Well, that’s not good. A stable relationship is one that has a clear guideline and direction on deciding over matters, and financial details are very important. So before you walk to the altar and take a vow to spend the rest of your life with your partner, you need to first have the money talk to find out if you’re on the same page – so you can work together in achieving an agreement.
Share and discuss your personal views about money
How do you feel about handling money? How about your partner? What do you think about how financial affairs are to be managed? You need to disclose what you learned as a child and how you developed your own style, and listen to the same with your partner, so you can gain a deeper understanding of how your views came to be.
Possibly, you were raised in a well-off family and have been used to living without a budget. This is something that you will need to let your partner know, because he or she could be a saver and could cause a potential conflict in the future. Telling about your spending personalities early on could save you time and trouble later on.
Talk about your credit standing and scores
Once you’re married, you will still have your own credit file, but you may now open joint accounts, such as credit cars, loans, as well as a mortgage. If you or your partner has bad credit, then it could potentially affect the interest rates that you will get on your joint accounts.
Disclose all of your financial obligations
Are you spending money in places that your partner does not know of? Before you tie the knot, it is only proper to come clean and disclose all of the arrangements you have that you are allocating your money to. It could be a charitable contribution, financial assistance for your relatives, child support, or even alimony payments.
Your other obligations, such as existing loans and debt, should also be disclosed to avoid any surprises in the future.
Set your goals
It is recommended to draft a list of short term, mid range and long term financial goals that you and your partner will agree on. Share your common goals to ensure that you can help each other achieve them. If you have your own set of goals, list them down as well so you can get the support of your partner, the same way you will help him or her with his or her personal goals.
Budget as one
Since you’ll be spending the rest of your lives together, then it makes sense to budget and manage your finances as one unit. Having a budget is an absolute must, or else you could find yourselves coming up short on a monthly basis. Worse, you could both end up in a mountain of debt.
This starts when you plan your wedding. Set a budget and stick to it – or else you could spend the next couple of years paying it off.
Have a chat about children
Do your plans involve raising a family of your own? If it does, then it is best that you develop a timeline and plan of action to ensure you are able to cover the costs of parenthood. From basic necessities to education, the amount is now higher than it was when we were younger.
Plan for your retirement
You are marrying each other with the idea of growing old together, so having a plan for retirement doesn’t seem farfetched, regardless of how young you still are. Save up for your retirement. It will be an eventual important source of income for you when you grow older. If your employers offer retirement programs, you could sign up for it.
Furthermore, a life insurance policy could be a great idea – try and explore your options both from your employer and privately.
Discuss if you’ll be having joint accounts
This is one of the topics that should be settled down before you race to the altar. Indeed, a marriage is a union of two people, but there are couples who decide to not combine their finances and keep their bank accounts separate.
There also comes the topic of prenuptial agreement. This is usually the case when one of the two is significantly wealthier than the other, and has other beneficiaries or heirs to consider. Talk about what will work best for your relationship.
Share your career plans
Talk about your career aspirations so you can fit them in your overall plans when you are married. Perhaps a promotion could mean more income but longer hours – which could mean that the other spouse can stay home and rely on just one source of income.
Also, it’s possible that you’ll want to start a business together, which would mean that you will tap on your savings to make ends meet while setting it all up.
Have a solid back-up plan
One of the worst reasons that couples fight is money issues. When financial problems arise, so does fear and frustration. As such, it is important to have an emergency fund that you can run to if anything unexpected happens. Of course, you will need to set boundaries and clear rules when it comes to withdrawing from this account.