Marriage is an exciting life event—and one of the most significant family and estate financial milestones. As you get closer to the big day, it’s important to talk to your future spouse about how to prepare for marriage financially.
Approaching the conversation of how to manage your finances in a marriage doesn’t have to be difficult. In fact, discussing your needs and financial goals with an Ameriprise financial advisor can help you and your future spouse get on the same page with your finances.
One of the most primary pieces of marriage and finance advice is simply: Set up time to discuss finances with your partner. Honest financial conversations can help you avoid misunderstandings now and down the road. This conversation checklist can help you get started:
A budget can help you understand your current spending patterns and align your day-to-day habits with your long-term financial priorities and values.
Some couples designate one spouse to manage the budget, while others may take turns keeping records and paying the bills. Whatever your approach, ensure you’re both aligned and keep your records somewhere you both can easily locate important documents, when needed.
Learning how to manage finances in a marriage means learning how to manage debt. Managing debt can be a stressful process. When getting married, one spouse may have more debt than the other, or you both may have debt from credit cards, student loans, etc. The first step to tackle debt is to create a plan. Based on your budget, decide how much money you have available to pay down your debts each month. For student loans, pick the most feasible repayment option.
It’s important to be upfront when managing debt and to have a safe space to discuss solutions. An Ameriprise financial advisor will help factor debt management into your financial strategy.
To prepare for marriage financially, some couples merge their bank accounts, others keep them separate and some have a mixture of both.
For example, some couples find it helpful to set up a combination of joint accounts for shared household expenses and separate accounts for personal spending. Whichever decision you make as a couple, plan to discuss it early in the marriage.
An important piece of marriage finance advice is for you and your spouse to discuss insurance coverage plans. Understand the different types of insurance available and decide together which are the best for your family.
Buying a home is a long-term investment and one of the biggest reasons why it’s so important to understand how to manage your finances in a marriage. Before you purchase a home, review your financial situation carefully, including these actions:
Once all the necessary items are in order, decide together where you want to live and the must-haves in a home. Being on the same page with your spouse about these details will make your house hunting easier.
Consider preparing a will early in your marriage, especially if you and your spouse already have children, or plan to, at some point in your marriage.
A will allows you to specify who will care for your minor children and where your assets will go to in the event of your passing. Even if your estate is modest or you are young, having a legally valid and up-to-date will can provide peace of mind for you, your family and loved ones.
Updating your beneficiaries on your financial accounts is also an important action to take as you prepare financially for marriage, because a will does not supersede beneficiary designations in determining who receives your assets after you die. Thus, all financial accounts (regardless of size) should have beneficiaries named—and updated over time, as needed.
Do you or your spouse have children from another relationship? Has your spouse been previously married? If so, it’s important to determine how existing obligations—like payments for child or spousal support, for example—will impact your budget. Additionally, it may also affect where you decide to buy a home, determine beneficiaries in a will, and inform the level and type of insurance you select.
When you get married, your lives change. So does your financial situation. An Ameriprise financial advisor can help you learn how to prepare for marriage financially with personalized advice as you start this new chapter.
