Getting Your Finances in Order Before You Get Married

Love and money go together like bees and honey. This I tell you couples, you cannot have one without the other.
You may have guessed it. Money is the number one fight among married couples. However, before you take that big step, each person should always have his or her financial state of affairs in order. If you have a huge credit card debt, live from paycheck to paycheck or you are sticking up Paul to pay Peter, then perhaps you should think twice before walking down the aisle. Moreover, if both of you are having thorny money issues, then maybe you should postpone the nuptial, because, money dilemmas will not disappear after the wedding. If money problems are not resolved first, the cash flow troubles will only get worst.

This is not to say that money problems will not develop over time; they may, due to various unforeseen events. However, as a newly wed couple, you want to start out with a fresh slate. The last thing you want is to go into a marriage with accumulated debts from your single days, or end up being responsible for someone else’s bad arrears, which can put a strain on the marriage. If you are a saver and plan to marry someone who is a major spender, you will want to protect your assets, especially if you have minor children.

Whether your income is low, medium or high, the best defense for reducing money quandaries is to manage your money wisely right from the start. However, if your money troubles have gotten out of control and you cannot see you way out of a financial mess, you and your future spouse may want to seek out a financial planner.

A financial planner can provide assistance in making your money work for you. As a couple, the planner may evaluate your financial history, assist you in developing a financial plan and continue to review your investment options and make recommendations according to market events. You can both also attend local or national seminars and workshops in money management sponsored by community centers, colleges, churches, brokerage firms, financial groups or professional associations.

One of the best ways to choose a reputable financial planner is through recommendations from peers, business associates, lawyers, accountants, or individuals who have had investment success. Be certain that any planner you intend to employ has the skills and the expertise to meet your needs, has extensive knowledge in taxes, insurance, estate and retirement planning matters and has the insight in investment and family budgeting.

Before you select a financial planner, you each should know what your short and long term financial goals are. You each may have different objectives that may clash or place additional tension on your relationship. Matters to consider in examining each of your needs include family size, how much cash you will need for retirement and what your budget can afford now and in the near future. What is your own money or investment philosophy? Do you enjoy risky ventures, do you seek the comfort of solid, blue-ship investments or do you want to diversify your money. By examining these issues, you will be able to communicate your intentions clearly, so that your financial planner can put together a portfolio that will continue to work for both of you as your objectives change.

For many couples, a pre-nuptial agreement may be the best step to take, to protect the money you have accumulated before coming into a marriage, which should be separate from the assets you accrue during the marriage. If you plan to draw up a pre-nuptial agreement, consider the following:

  1.  A pre-nuptial agreement is most important if you are going into a second marriage, own a business or are an executive. Other situations may also justify an agreement.
  2. You do not have to be rich to have a pre-nuptial agreement.
  3. A pre-nuptial agreement is divorce insurance and can cost from $1,000.00 to over $25,000.00 depending on the amount of assets involved.
  4. If you decide to have a pre-nuptial agreement, have your own lawyer.
  5. Always disclose all assets. If you do not, the agreement may be invalid.
  6. As you grow financially, update the contract.
  7. If you both reconsider, termination of the agreement is valid, but tearing up a pre-nuptial agreement will not hold up in court.

Of course, managing your money wisely begins at an early age. However, it is never too late to start overseeing your finances so that after you say “I Do,” you and your spouse will not end up working hard for your money. Instead, your money will be working hard for you.