First off, Congratulations on finding your better half, a task agreed to be nerve-wracking and tiresome but a task you’ve successfully completed! Feel free to give yourself a pat on the back. So what’s next? Oh yes, “something old, something new, something borrowed, something blue!” We’ve all heard it before, an overly rehearsed expression after the first chime of the wedding bells. Even before we get there, though. What’s the one thing that blushing brides tend to overlook but may be one of the most helpful to their marriage? Some financial advice! Your financial future is even more important than which dress you’ll say yes to or whether your crazy Aunt Pam should be seated at table 3 or 4.
The American Psychological Association (http://www.apa.org/topics/divorce/) supports that, about 40 - 50 percent of US married couples divorce. Even more shocking, Psychology Today reports that according to Jeffrey Dew of the National Marriage Project,“couples who reported disagreeing about finances once a week were over 30 percent more likely to divorce over time than couples who reported disagreeing about finances a few times per month.” With that being said, it’s best to find out if you two are financially compatible before you walk down the aisle.
The American Psychological Association (http://www.apa.org/topics/divorce/) supports that, about 40 - 50 percent of US married couples divorce. Even more shocking, Psychology Today reports that according to Jeffrey Dew of the National Marriage Project,“couples who reported disagreeing about finances once a week were over 30 percent more likely to divorce over time than couples who reported disagreeing about finances a few times per month.” With that being said, it’s best to find out if you two are financially compatible before you walk down the aisle.
So my gift to you will not be silverware, glassware or even a toaster. These questions that although, intangible are far more valuable because they will save your marriage instead of clutter your kitchen or burn your toast. Thank me later.
1. What’s your credit score? I won’t elaborate too much on credit scores because I’m sure everyone knows just how important they are and how much they can affect. Use AnnualCreditReport.com to check together and see where each of you stand.
2. Do you have any debt? What sort of debt will the couple have? Credit cards? Student loans? Mortgages? Don’t be afraid to ask what kind of debt was incurred, you need to know if your partner is a careless spender drowning in credit card debt or a knowledge seeker haunted by student loans. Also, it should be addressed, if you guys are going to share the responsibility of getting in good standing or is every man for himself.
3. Should we keep our finances separate or combine them? Will you have a joint account or would you rather keep your shoe splurges secret? Some couples love the trust building factor associated with joint accounts, and others hate that there is no freedom in having one. You guys may be the couple that has both – one account for joint expenses and others solely for each others personal spending. Whatever the choice, make sure it’s one that works for the both of you.
4. How will we handle daily spending decisions? According to an article on Washington Post
(http://www.washingtonpost.com/news/get-there/wp/2015/01/21/proof-that-couples-lie-to-each-other-about-money-all-the-time/), roughly 7 million people are lying to a significant other about money. You need to decide together how money will be spent and how much is allotted for things such as household expenses, clothing, groceries, etc. Budgeting is everything and will be especially helpful if you or your partner has a spending problem. Also, decide if you need to call before you swipe the card for a McDouble or only if you’re signing for a mansion.
5. Where do we want to be in 5 years? 10? 20 What are your goals? What are your partner’s goals? Do you dream of having a lifestyle mirroring the rich and famous, with fine dining and fast cars? Or would you settle for a modest life and a minivan? Discuss your money goals! There’s definitely a difference between pinto pushing and penthouses. Will it be affordable to vacation often or will traveling be limited to special occasions? Make sure you’re on the same page, what’s “comfortable” for you may not be for your future spouse.
6. Do we want kids, and if so, who will work? I feel like we’re friends at this point so let’s be real, those little crumb snatchers are expensive. So let’s talk how many and whether there will be a stay at home parent or a daycare bill. Discuss income sharing and tally up the diaper costs. You will never know what the future has in store but having some idea of the direction you’re heading in will help you later.
7. Will we sign a prenup? Prenuptial agreements show how assets should be distributed to each party in instance of divorce. Instead of shining a negative light on these agreements, view them as tools to help guide in the event than your partner walks out, forgetting just how special you really are! Contrast to popular belief, they aren’t just for the rich. If either of you own a business or home or have kids from a previous marriage, you should discuss the option. With a significant amount of marriages ending in divorce, I’m more than positive you’d rather be prepared than penniless so protect yourself.
So there you have it, before you even start to obsess over the cake and flowers you should start making plans for your shared financial future. Agreeably, finance may sound like the furthest thing from romantic but it is the foundation of the future for you and your partner.
1. What’s your credit score? I won’t elaborate too much on credit scores because I’m sure everyone knows just how important they are and how much they can affect. Use AnnualCreditReport.com to check together and see where each of you stand.
2. Do you have any debt? What sort of debt will the couple have? Credit cards? Student loans? Mortgages? Don’t be afraid to ask what kind of debt was incurred, you need to know if your partner is a careless spender drowning in credit card debt or a knowledge seeker haunted by student loans. Also, it should be addressed, if you guys are going to share the responsibility of getting in good standing or is every man for himself.
3. Should we keep our finances separate or combine them? Will you have a joint account or would you rather keep your shoe splurges secret? Some couples love the trust building factor associated with joint accounts, and others hate that there is no freedom in having one. You guys may be the couple that has both – one account for joint expenses and others solely for each others personal spending. Whatever the choice, make sure it’s one that works for the both of you.
4. How will we handle daily spending decisions? According to an article on Washington Post
(http://www.washingtonpost.com/news/get-there/wp/2015/01/21/proof-that-couples-lie-to-each-other-about-money-all-the-time/), roughly 7 million people are lying to a significant other about money. You need to decide together how money will be spent and how much is allotted for things such as household expenses, clothing, groceries, etc. Budgeting is everything and will be especially helpful if you or your partner has a spending problem. Also, decide if you need to call before you swipe the card for a McDouble or only if you’re signing for a mansion.
5. Where do we want to be in 5 years? 10? 20 What are your goals? What are your partner’s goals? Do you dream of having a lifestyle mirroring the rich and famous, with fine dining and fast cars? Or would you settle for a modest life and a minivan? Discuss your money goals! There’s definitely a difference between pinto pushing and penthouses. Will it be affordable to vacation often or will traveling be limited to special occasions? Make sure you’re on the same page, what’s “comfortable” for you may not be for your future spouse.
6. Do we want kids, and if so, who will work? I feel like we’re friends at this point so let’s be real, those little crumb snatchers are expensive. So let’s talk how many and whether there will be a stay at home parent or a daycare bill. Discuss income sharing and tally up the diaper costs. You will never know what the future has in store but having some idea of the direction you’re heading in will help you later.
7. Will we sign a prenup? Prenuptial agreements show how assets should be distributed to each party in instance of divorce. Instead of shining a negative light on these agreements, view them as tools to help guide in the event than your partner walks out, forgetting just how special you really are! Contrast to popular belief, they aren’t just for the rich. If either of you own a business or home or have kids from a previous marriage, you should discuss the option. With a significant amount of marriages ending in divorce, I’m more than positive you’d rather be prepared than penniless so protect yourself.
So there you have it, before you even start to obsess over the cake and flowers you should start making plans for your shared financial future. Agreeably, finance may sound like the furthest thing from romantic but it is the foundation of the future for you and your partner.
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