While money is a primary cause of marital strife, a recent Ameriprise study found that nearly seven in ten couples say they have good financial communication. Before wedding planning kicks into high gear, make discussions about your finances a priority. Taking the time now to talk through money things can create a good foundation for your collective future. Use the following six principles to guide your money conversations:
1. Open-minded. Take turns sharing your vision for cash management as a married couple. Listen carefully to what your future spouse says is important to them. Acknowledge your gaps and build on your strengths. If your expectations do not match up, try to find a compromise. Some couples sidestep conversations about money to avoid feelings of hurt, fear, anger or remorse. Creating a habit of frequent communication may help you avoid heated arguments, and can help ensure you’re on the same page financially before you walk down the aisle.
2. Honesty. Financial secrets can destroy trust. Share the specifics of your financial history and current situation in case you have not already done so. Your future partner deserves to know if you’re paying off college debt, or if you’ve made any financial mistakes in the past (and the way you have rectified them). Disclose the good news, too. Divulge details about savings you’ve tucked away or a family trust that helps supplement your income so you know the amount of where you stand.
3. Forward-thinking. As soon as you’ve shared your current situation and background, discuss your goals for the future. Be open about what your dreams are, but 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.) lets you combine forces on economies and gives you a road map for paying.
4. Cooperation. To avoid any miscommunications as newlyweds, talk and assign responsibility for monetary roles. Is one of you at monitoring online accounts and paying bills? Are you enrolled in a retirement account and taking maximum advantage of employer contributions? Who will be the principal contact for your financial advisor, tax professional or estate planner? Two is better than one when you are able to divide and conquer financial tasks, but make sure that you’re both in the loop on key decisions and money matters.
5. Diligence. It takes discipline, but taking good care of these housekeeping tasks right away protects you in case something unexpected occurs. Several Actions to consider:
• Consider combining your bank account if it makes sense for your situation.
• Update or write your will and estate plan to reflect your collective wishes.
• Amend your tax withholdings, to make sure the perfect amount is withheld from your paycheck that you are married.
• Choose your wellbeing insurance. If both of your companies offer health insurance, carefully evaluate your coverage options and premiums for the ideal fit.
Like most things worth attaining, preparing for a lifetime of financial compatibility takes work. If you and your future spouse can commit to the same money values, it may help you create a solid financial base.