It’s summertime and that means it’s wedding season. You may be spending your weekends stuffing envelopes with cash to help grooms and brides-to-be celebrate the beginning of their lives together. But let me ask you a question, before you hand over your wedding gift do you ever wonder how the happy couple will spend the money?
His and Her Money
I always wonder if the couple already talked about money, if they’ve opened a joint bank account, if they’ve signed a prenuptial agreement and if they have already set a household budget. As a financial planner (and one half of a long term couple) all I can say is…I really hope so.
It’s important for couples to talk about money before they get married because it will help them live happily ever after. According to SELF Magazine money is a major source of stress in relationships, so why not get it out of the way before you get married.
Use this checklist to get your money right before you say I Do:
Will you share a checking account? This is the number one question couples ask me when they come to get pre-marital financial advice. Managing incomes and expenses from two people in one account can be difficult. However the benefit of a joint account is maintaining a minimum monthly balance in one account can be easier than trying to maintain two balances in separate accounts. This will help you save money on monthly bank fees.
Should you sign a prenuptial agreement? Prenups often get a bad rep, but it protects both spouses when it comes to assets and debts accumulated before and during the marriage. Seek the advice of both a financial planner and a lawyer when it comes to a prenuptial agreement.
How will you share financial expenses? It’s nice to think newlyweds will share their expenses equally, after all that’s what a marriage is right? A 50/50 partnership. But what happens when one spouse makes more money than the other? Conflict can arise if one spouse feels they are contributing more than the other. This is why it’s best to discuss your income prior to tying the knot. The easiest way to split expenses with unequal incomes is for each spouse to contribute a percentage based on your after tax paychecks. Or decide ahead of time based on income, who will be responsible for specific bills and expenses.
Are you going to set spending limits? When you get married your life merges with your spouse, this includes living together and spending together. Would you ask your spouse before you spend any money? I don’t ask my boyfriends permission, but I do always consider our monthly household obligations before I spend any money on personal items. If our bills are paid and we don’t have anything on our wish list, I will buy myself a little treat and he does the same. With that being said if my boyfriend does come home with a new gadget or a new pair of shoes I will go out and spend some money on myself – absolutely guilt free.
Marriage is hard. Money issues makes it even more difficult to navigate the waters of marital bliss. Try to have the difficult conversations before you jump the groom an set up ground rules to avoid arguments around unmet expectations later.