By Andrew Housser
If you are saying "I do" (or recently did), it's time to get serious not only about your relationship, but about your future financial outlook as a couple.
Money is one of the top reasons that married couples fight. Sadly, fights over finances can turn that walk down the aisle into a later date in divorce court. A recent study by the National Survey of Families and Households found that couples who have weekly money disagreements are nearly 30 percent more likely to divorce than couples who argue about finances less often. You can keep your love and your finances strong by heeding this advice.
1. Have the money talk. Ideally, you and your significant other had a heart-to-heart conversation about your individual and combined debts and assets before tying the knot. Now that are you married, you still should review each other's credit score, bank statements, credit card statements, debts and assets on a regular basis. Figure your monthly expenses and craft a budget that works for you as a couple. Make sure to factor in how you plan to pay off any debt and start saving for a home and family. If one or both of you has student loan debt, visit the U.S. Department of Education to see if you can consolidate your loans into one with a lower, fixed interest rate. Now is also a good time to discuss financial roles. Tasks like paying bills and staying on budget take time and require a level of responsibility. Decide now who will shoulder this burden. Once a month, make a money date to review expenses and adjust your budget and financial responsibilities as needed.
2. Decide on joint or solo accounts. While there are no rules, it is common these days for couples to have joint checking accounts for shared expenses such as rent or mortgage, utilities and groceries. Each also may have separate individual accounts. This type of system can help maintain some level of fiscal independence. If you are using a joint account to pay shared bills, decide what percentage of each paycheck needs to go into the account so that expenses are covered and the contributions are fair. Keeping finances separate can be a smart move if one of you has poor credit. This may give the option of applying for loans in the name of the spouse who has better credit.
3. Prepare for emergencies. If you received cash wedding gifts, consider putting some toward an emergency fund. This fund will help to see you through an unexpected and potentially costly life event like a health crisis, a job layoff or a major home repair. (Remember this account is off limits for expenses relating to vacations or other items that are not required in an emergency situation.) Ideally, you should work toward saving enough to cover six-nine months of living expenses. If you and your spouse agree to set aside just $50 a week, you will have saved $2,400 at the end of a year. Start slowly and work up if you need to; every contribution counts.
4. Save for later. Many couples dream of owning a home. If you are one of those couples, the sooner you start saving for that down payment, the better. Again, take a look at your budget and expenses. Figure out creative ways to save (pay less for cable, cut back on nights out) and then actually put that money into a savings account. Even though retirement may seem pretty far off, you also should both be putting money into retirement accounts.
5. Insure yourselves. Life insurance can be among the best ways to be certain that your spouse will be able to meet joint financial obligations should you pass away, especially once you buy a home or start a family. You can get price quotes from online insurance specialists at SelectQuote or AccuQuote. A will is another necessity. It helps to make clear who inherits your assets upon your death.
Full disclosure is a marital must when it comes to finances. Getting your financial house in order takes time and trust. You likely will have to navigate many challenges along the way, such as unexpected expenses and moments of overspending. It is important for the two of you to work together as a team to make sure your dreams are realized.
Andrew Housser is a co-founder and CEO of Bills.com, a free one-stop online portal where consumers can educate themselves about personal finance issues and compare financial products and services. He also is co-CEO of Freedom Financial Network, LLC providing comprehensive consumer credit advocacy and debt relief services. Housser holds a Master of Business Administration degree from Stanford University and Bachelor of Arts degree from Dartmouth College.