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Getting married requires financial planning
Establishing some financial rules ahead of time will help a new marriage
Couples who are about to get married should take some time to sit down, assess their finances and debts, and make a plan as to how they will handle their financial future.
Continued below
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Marriage is a merger of finances as well as lives. Plan it well.
It is said that the one thing that married couples fight about more than anything else is money. That being the case, it is surprising that more couples don’t take the time to plan their financial future before they take the time to get married. Couples will often spend a year or more planning the wedding, with location, catering, hairdressers and honeymoons being planned well in advance of the actual event. But few couples take the time to assess how getting married will affect their financial lives. This is something that will, after the marriage, have a day to day effect on them, and yet few people take the time to assess the situation and plan it out.
Here are some things that married couples should do before getting married:
- Get an overview of the situation - Do you have debts? Does your partner? Once you get married, those debts effectively belong to both of you, so you should examine them now and decide how you plan to pay them off once you get married. It’s hard enough just learning to live with another person, but if you have to live with the debts that that other person brings to the marriage, it can be a lot harder. Examine your finances and make a plan for paying off your debt.
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- Set up a budget - Now that you know how much you owe, look at how much you earn and how much you spend. This is the ideal time to establish a budget in order to decide how much money will go where each and every month. You will want to make sure that you have sufficient funds for living expenses, food, transportation and retirement of existing debt. You also want to make sure that you can put some money into savings each month and you also want to put some money into a retirement plan every month, such as a 401(K) plan or other long-term investment. Over time, you also will want to establish an emergency savings fund that contains three to six months’ worth of living expenses. You never know when an illness or loss of job may occur, and you want to be prepared for that sort of financial emergency. Now is the time to plan.
- Keep some money aside for fun - While you want to make sure that all of your needs, both present and future, are met, you also have to accept that fact that you are a newly married couple and you will want to spend some time doing fun things. That being the case, make sure that you can budget some funds for occasional fun, such as a dinner out, a movie, or a vacation. It’s important to make sure that all of your financial needs are met, but you also need to accept that some fun in life is important. The whole point of creating a financial plan is to create one that is well balanced.
Getting married creates huge changes in the life of both partners. You should take the time to plan the financial changes now.
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