7 smart money moves to make before you marry
Wedding planning is more than choosing the venue, the colors and the cake.
You also need to plan the successful marriage of two sets of finances and a prosperous life together. Which means it's vital to make a few savvy money moves before "yours" and "mine" becomes "ours."
Whether you're getting married in a few weeks or a few months, here are seven things to consider before you walk down that aisle:
No. 1: Ask yourself three questions.
Money is the source of much marital discord, especially for new couples, says Terri Orbuch, marriage and family therapist, professor at Oakland University and author of "5 Simple Steps to Take Your Marriage from Good to Great."
Often those money fights aren't really about money, she says. Instead, they are about security, control, self-esteem, love – whatever money represents to each party.
"Couples need to look beyond the surface about money," she says. "Money is a tangible thing so it's easy to project those emotional issues onto money."
To get to the root of your money issues, Orbuch recommends a solo timeout to ask yourself three questions:
How did your parents deal with money growing up?
What did money mean to you (and your parents) when you were growing up?
How have you dealt with money in previous relationships?
The first goal: "Really have an understanding of how you approach money," she says. Then come together and share your answers and "ah-ha!" moments, Orbuch says. "Be open-minded and ask questions."
No. 2: Make money a regular topic.
Want to take the sting out of talking money? Talk about it often and have some fun with it, says Orbuch.
If you're not married or not sharing a household, the subject might be new, she says. So make it light and fun. Some sample topics she recommends:
What kind of vacations do you think we're going to take in the future? How many days? All-inclusive or a la carte? Extravagant or budget-minded?
If you won a significant amount of money tomorrow, how would you spend it?
It gives you a chance to dream and plan together, along with a window into what you and your spouse-to-be value and want from your financial lives, Orbuch says.
As you get more comfortable talking about money, you can discuss how you want to manage it day-to-day in your new household, says Sue Hallowell, a couples therapist and co-author of "Married to Distraction."
"Joint accounts, separate accounts, joint credit cards, separate credit cards – really talk about the mechanics of how that's going to work," she says. "I think if people really do some of their homework around that, they will have many fewer issues as they get married."
No. 3: Set ground rules that work for both of you.
One dirty, little secret of marriage: Neither one of you is "right" or "wrong" in your approach to money, says Hallowell. So stop trying to "fix" your partner and instead set ground rules that give both of you financial peace of mind.
One of the greatest fallacies in marriage is that you will change the other person or the way he or she handles money, she says. "You can't. But you can put strategies into place that give you both the comfort you need."
That could mean setting a joint spending threshold above which buying decisions have to be discussed. Or paying bills and setting aside savings for that luxe vacation or new home first, then both having a free hand to spend what's left.
"It's about understanding and making strategies that work for both of you," says Hallowell. "That's why it's so important to do it before problems arise.
Another smart strategy: In addition to the chats you have in daily life, schedule time to talk about finances and goals at least every three months, says Orbuch. Big-picture talks outside the sniping over current obligations can let you calmly discuss concerns and plan long-term, she says.
No. 4: Turn on the lights.
Chances are you know about your intended's romantic past. But how about their financial past?
If not, then you want to initiate that discussion, Hallowell says. You need to be able to say, "We're going to be a couple now, and we're going to be joined. It's important that we know what each person brings to the marriage," she says.
"It's true for the emotional baggage we bring into the marriage, and it's true for the financial baggage we bring into the marriage," says Hallowell.
If you know that one of you has a pile of debt or bad credit, you can plan, she says. "Not knowing all the facts makes it harder to develop strategies to move forward."
As part of your ongoing talks, review your credit histories and credit scores together, says Jill Gianola, a Columbus, Ohio, financial planner and author of "The Young Couple's Guide to Growing Rich Together."
"Especially if you are going to consider buying a home together or making a big purchase together," she says. "Not to say you can't accomplish that goal if one of you falls short. But you may have to reshuffle. It's important to know what you're marrying."
Also on the list: income, savings and debts.
Hiding a big, ugly money monster in the closet?
Come clean well before you marry, Orbuch advises. "Money secrets are dangerous," she says. They "eat away at the trust in a relationship." In fact, according to a 2018 survey by CreditCards.com, 31 percent of respondent said that hiding accounts is worse than cheating.
Pick a relaxed time and a place when there are no distractions, says Orbuch. Not when your loved one's favorite show is on or when you're both exhausted. Also, no computers, phones or texting.
"The situation really makes a difference in how people hear any information," she says.
No. 5: Get a prenuptial agreement.
"There are just three things to do: prenup, prenup, prenup," says Raoul Felder, attorney and author of "The Good Divorce." "That's the smartest thing you can do."
And yes, bringing it up "is very tough," he says. Two points to make it easier: Do it well in advance of the wedding and place the blame elsewhere. Something along the lines of, "I went in to do my will, and I have to have a prenuptial agreement," says Felder. Or, "My father's going to leave me some money and wants me to have a prenuptial agreement," he says.
"Lay it off on someone else," says Felder.
What a prenuptial agreement does: Except for issues involving children, custody and child support, a prenup lays out exactly how your assets will be allocated in case of a split. "It prevents ugly fights over money – whether it's support or division of assets," he says. "It protects you against all of that stuff.
In most of America, there's a distinction made between property acquired before marriage and during marriage, and property acquired during marriage is eligible to be divided, Felder said.
"One option to consider is an escalating arrangement that increases your spouse's share in those assets the longer the marriage lasts," he says.
Whatever provisions you make, you have to be honest going in about what you really have, says Felder. "You have to submit estimates of your monies that are accurate."
No matter who initiates it, with a prenuptial agreement, you each need to have your own attorney, says Gianola.
And if you're getting a prenup, take care of it well in advance of the ceremony, preferably before you send out the invitations, she says. "Before you book the venue or the caterer, I think I would get this straightened out."
No. 6: Don't consolidate debts.
Joining your lives is thrilling. But joining your debts is unnecessary, says Gianola.
If one party comes into the marriage with debts, such as a credit card balance or a pile of student loans, don't just put the other person's name on that, she says.
That means don't transfer balances onto the nondebtor's cards or even to a joint card, she says. While you can certainly help each other pay off your individual obligations, there's no good reason to put both names on them, she says.
But there's a good reason not to: It can hurt the nondebtor's credit.
By keeping pre-existing debts separate, you protect the nondebtor's credit, says Gianola. And that can be a smart strategy if you both decide to use that good credit later for a home or car, she says.
One all-too-common error for young couples is putting each other's names on their student loan debts, she says. Big mistake.
Instead of a wildly romantic gesture, what you've really done is declare that in the event of a divorce or your own untimely demise, your intended gets to carry your school bills around until they are paid in full, says Gianola. And student loans are one of the few obligations that can't be erased in bankruptcy.
No. 7: Consider professional help.
How do you know when your relationship needs professional (financial) help?
"If there's a sense that either party is either reluctant or doesn't know how to go about pulling their information together, says Gianola. "I think a third party can sometimes grease the skids a little bit."
Sometimes parents or relatives will also gift an engaged or newlywed couple with a financial planning session. The price tag is often in the $400 to $800 range for a two-to-three-hour session, she says.
A good planner can help you devise a bill-paying or money management system that works for you both and also help you answer questions such as how much house you can afford, says Gianola.
If, despite multiple, nonjudgmental attempts to share financial information, plus a meeting (or the suggestion of a meeting with a pro), your intended is evasive or stone-walls, that could be a red flag, says Orbuch. "There may be a deeper or more serious issue."
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