One of the most challenging parts of planning a wedding is managing your budget. More than that, you need to consider all the decisions you’ll make after you’re married. So what are those decisions, exactly? And what’s the smartest way to square away your financial concerns? Before you say, “I do,” make sure to address the following five areas.
1. Discussing Past Debt
When you get married, your spouse’s outstanding debt becomes yours, and vice versa, absent a legal instrument absolving you of responsibility. Often, this situation becomes apparent at tax time when you don’t receive your half of the refund because your partner owes past child support or defaulted on their student loans.
If you choose to create a prenuptial agreement, include responsibility for balances accrued before marriage. While rare, if your new partner makes the proverbial run for the border, you don’t want to get stuck with their bills.
2. Combining Your Insurance Policies
Good news! Married people have fewer automobile accidents than single folks, and insurance underwriters pay heed. You could stand to save hundreds per year, and there’s no need to carry two policies. Your status extends protection to your spouse.
Another way to save money is by bundling. If one of you enjoys preferential rates, stick with that company and combine your homeowner’s policy with car coverage.
3. Blending Homeownership
If one of you owns a home while the other rents, it’s logical to move into the deeded property. In general, you can add your partner to your title via a quitclaim deed, but check with your local jurisdiction to make sure. Otherwise, if something happens to you, your spouse could find themselves in a bind if you don’t live in a community property state.
4. Splitting Expenses
How will you pay the bills? Some couples choose to have the higher-earning spouse pay the lion or lioness’ share. Others keep things separate but equal, where each partner pays 50% of joint expenses and managing personal debt. Whichever method you prefer, make sure you discuss it before tying the knot.
5. Addressing Spending Differences
If you live to splurge but your partner pinches pennies, you could experience conflict down the line. The trouble thickens if you share mutual credit cards, and one spouse runs up the balance. The best way to prevent problems is to establish a budget and discuss your financial concerns openly. Your other half may not realize your sullen attitude stems from money worries unless you say so.
Address These 5 Easily Missed Financial Considerations Before Saying “I Do”
When you prepare for marriage, you have many things to consider. Make sure you and your future spouse address these five easily missed financial matters before walking down the aisle.