You're getting married. Congratulations! During this exciting time in your life, you also have a lot of things to think about and do. One of the most important things to think about is your finances. Remember: when the two of you tie the knot, you're tying a financial knot too. So it's important to set your money expectations, make careful financial plans, and check in with each other regularly to make sure you're on track. Below are five ways that can help unite your new financial lives.
1. Get Organized.
Now that you're married, it's time to put it all on the financial table: what you have, what you owe, how much you spend, and how you feel about investing. Staying organized can help make managing your money in the future much easier. Here's a quick list of tips to jumpstart the process:
- Make a list of all your income, assets, and debts.
- Decide how and what you might consolidate.
- Plan your spending and savings together.
- Tackle your debts together.
- And most importantly, start a budget.
2. Set Goals.
Setting realistic financial goals with your loved one is another big part of marriage. Whether you're thinking about buying a house, taking an awesome vacation, or planning for retirement, being on the same page is a must. This makes saving and investing THAT much easier and important. You can start by making saving a habit. Try to put away a set amount of money regularly so that you don't even think about it on payday. Setting up automatic investments will help with this and keep you on track. Tip: Scheduling regular automatic transfers from your bank account to your savings or retirement accounts such as an IRA or checking account could be a smart way to keep yourself on track.
3. Protect What Matters Most.
Another important topic to go over with your other half is insurance including life, health, and disability. You'll want to review, update, and in some cases even purchase different types of insurance. Even though some insurance may be provided by your employer, it might be less expensive to be on your spouse's plan, so take a second look and be sure to know your options when considering and revising health insurance options.
4. Minimize Taxes.
One of the less exciting things about your new marriage (but an important thing to take care of) is reviewing the finer details of your taxes. You and your partner will want to go over your tax withholdings and the ways you want to invest to potentially help minimize taxes and maximize retirement savings.
Tax-advantaged accounts like workplace savings plans, health savings accounts (HSAs), and IRAs can help you plan wisely for your long-term goals. If each of you has a workplace savings plan like a 401(k) plan or 403 (b) plan, contribute as much as you can—at least enough to earn any company-matching contributions.
5. Create a Will Regardless of Your Age.
Your will is the most important document of your entire estate. It provides directions on the distribution of your estate and makes sure that your wishes are to be carried out after your death. You and your spouse should make a point to review your wills regularly in order to address any changing circumstances. Money discussions aren't always the easiest for newlyweds, but it's best to approach them with a clear head, and open mind, and as a team. The more thought you put into your money matters, the more financial harmony you'll have in your new lives together.