Getting Married

When you get married, you tie the knot in more ways than one. In addition to committing to one another, you are also committing to a life of managing your money together. Regardless of whether you plan to manage your finances separately or jointly, you need to create a game plan before your wedding day.

Reviewing accounts and debts

It is not uncommon for couples to come together and realize that one has a lot more debt than the other. Whether it is credit card debt, student loans or a mortgage, you’ll need to talk about it. Start by sitting down together and taking a comprehensive look at what each of you owes.

If you feel tension because one of you has more debt than the other, discuss what you want to do about it. For example, some couples decide to manage their money separately, so each one continues paying pre-marriage debts out of his or her paychecks.

You’ll also want to take a look at each of your credit reports because your credit history will affect your ability to qualify for joint accounts, especially a mortgage. If your spouse has a lower score, lenders will use that on a joint application. The sooner you know about credit problems, the sooner you can start working together to improve your credit and build a strong financial future.

Setting financial goals

Once you know where you stand, talk about where you want to go. Do you want to focus on paying off debt? Saving money for a down payment on a home? Catching up on retirement savings? Going on lots of vacations while you are still young? In the areas where your goals differ, talk through your reasoning with each other until you are on the same page and in agreement on your priorities as a couple.

Deciding between joint or separate accounts

It is just as common for couples to maintain some separate accounts as it is to join their finances completely, so you should feel free to decide what makes the most sense for your situation and relationship. Maintaining separate accounts can be wise if one of you has child support or alimony responsibilities or if one of you has gotten a large inheritance. However, joint accounts are helpful for managing shared expenses.

If you both have both joint and separate accounts, decide where each other’s money initially gets deposited. Some couples deposit their paychecks into a joint account and then transfer allowances into separate accounts for their discretionary spending needs. Others choose to deposit their pay into separate accounts, with each transferring a specific amount each month into a joint account to cover shared expenses.

Agreeing on money management rules

The last step is to agree on your rules going forward. Talk about who will be in charge of paying the bills, how you’ll manage conflicts over money, and what types of financial decisions you need to discuss together. For example, some couples set a specific price point above which they have to agree on a purchase before making it.

Studies show that a great deal of marital discord occurs because of disagreements over money. In that regard, it is not as important the specific choices that you make, rather that you are in agreement on those decisions.