In the midst of the hustle and bustle that comes with planning a wedding, talking about finances is likely to get lost in the shuffle. While it’s not the most exciting conversation that you’ll have with your intended, it’s certainly a necessary part of maintaining a healthy relationship. Here’s what you should discuss when you sit down to talk finances before walking down the aisle:
It’s important to get a history lesson covering your future spouse’s financial decisions because they directly affect your financial future the day you say “I do.” You should discuss what kind of debt you have and how much, as well as outline your plan to pay it off. Make sure that you cover how much you each make, your bank account balance and what kinds of investments you have. You also need to talk about your credit score during this conversation since it affects your ability to take out loans and what interest rate you’ll receive.
Uncover Your Financial Personalities
Are you a spender or a saver? Are you more pragmatic or emotional in how you approach financial decisions? You need to know how the other approaches their finances and establish boundaries on discretionary spending so that you’re not putting each other in a bad financial situation. Additionally, you should be open about what areas you can improve on and help each other achieve those goals.
When it comes time to discuss combining your assets, here are some questions you’ll need to answer that will allow you to navigate this process with ease:
- Which assets will you combine and which will you keep separate?
- Who will take the lead on managing your finances?
- How will you split expenses?
- Will you sell any property?
You also need to discuss the tax implications of your impending marriage with an accountant.
Plan for the Future
Before the big day, you should determine what kind of lifestyle you want and if your incomes will support that once you’re married. Be realistic about what you can reasonably achieve both now and in the future. Create a budget to help you both stay on top of necessary expenses. It’s essential that you keep your goals in mind since they dictate the decisions that you both make.
Estate planning is not an exciting topic, but it’s essential to ensuring that you will be taken care of should something happen to you or your spouse. Consider the following when doing your estate planning:
- Who will be the beneficiary on your insurance policies, IRA and 401(k) plans?
- Who will make medical decisions for you?
- Do you need to update your will?
It’s easier to make these plans in advance, so don’t put off making a decision about estate planning before it’s too late.
Track Your Progress
Financial planning may not be fun, but it goes a long way to minimize future frustrations and to establish trust between you and your fiancé. Plan regular meetings to discuss your financial situation and track your progress towards established goals once you’re married. These meetings will keep you honest about your progress and will allow you to address any issues that may arise.
Talking about finances isn’t always easy, but once this conversation is out of the way, you can get back to the more exciting parts of wedding planning and focus on your life with your future spouse.