While money is a primary cause of marital strife, a current Ameriprise study found that nearly seven in ten couples say that they have good financial communication. Before wedding planning kicks into high gear, make discussions about your finances a priority. Taking the time today to talk through money things can create a good foundation for the collective future. Use the following six principles to direct your money discussions:
1. Open-minded. Listen carefully to what your future spouse says is important to them. If your expectations do not match up, try to find a compromise. Some couples sidestep conversations about money to avoid feelings of hurt, fear, guilt or anger. Creating a habit of frequent communication might help you avoid heated arguments, and can help ensure you are on the same page financially until you walk down the aisle.
2. Honesty. Share the specifics of your financial history and current situation if you haven’t already done so. Disclose the fantastic news, too. Divulge details about savings you’ve tucked away or a family trust that helps supplement your income so you both know the amount of where you stand.
3. Forward-thinking. Once you’ve shared your present situation and background, discuss your goals for the future. Be open about what your fantasies are, but you should be ready to compromise. While you don’t have to agree on everything, having shared goals (buying a house, saving for college if you decide to have kids, retirement, etc.) allows you to combine forces on savings and gives you a road map for spending.
4. Cooperation. Is one of you better at monitoring online accounts and paying bills? Are you both enrolled in a retirement accounts and taking maximum advantage of employer contributions? Who will be the principal contact for your financial adviser, tax professional or estate planner? Two is better than one if you’re able to divide and conquer fiscal tasks, but be sure you’re both in the loop on key decisions and money matters.
5. Diligence. Once you’re married, make it a priority to update your financial documents. It requires discipline, but taking care of those housekeeping tasks immediately protects you if something unexpected occurs. Several Actions to consider:
• Consider combining your bank accounts if it makes sense for your circumstances.
• Update or write your will and estate plan to reflect your collective wishes.
• Amend your tax withholdings, to ensure that the perfect amount is withheld from your paycheck that you are married. Consult your tax professional before making modifications.
• Choose your health insurance. If both of your companies offer health insurance, carefully assess your coverage options and premiums for the ideal fit.
Like most things worth attaining, preparing for a lifetime of financial compatibility requires work. If you and your future spouse can commit to the identical money values, it might help you make a solid financial base.