Open Discussions About Finances Can Put More ‘Happy’ In Your ‘Ever after’

Lisa Taranto Schiffer-Marriage Finances-Chispa MagazineApproaches to managing money can be as unique as people themselves. While the thought of talking about finances with your future spouse might feel so stressful that you want to put it off, having open and detailed discussions, both before and after the wedding ceremony, can make a significant difference in your financial well-being and your overall happiness as a couple.

Here are six important financial areas to focus on as you grow in your partnership together:

 Priorities. Consider what your new priorities will be together. Whether you want to travel, buy a home, have children, or support favorite charities, you’ll need a plan to reach those goals. Your investment strategy will depend on your timeframe and how you view risk. For instance, how you save and invest for short-term goals is different from how you would do so for long-term goals. Make paying yourself a priority by developing a regular savings and investment plan.

Joint decision-making. Reduce “surprises” by being inclusive and making decisions together rather than leaving key decisions to just one partner. With greater transparency and ongoing conversations about assets, debts and risk you can focus on moving forward instead of playing catch-up or putting out potential fires.

Key questions. Some questions to consider together: Will you be merging your finances, or maintaining separate checking, investing and other financial accounts? Who will be primarily responsible for keeping up with and paying the bills? How much life and disability insurance will you need? How can you stay on track toward meeting your financial and career goals long-term? Do you anticipate either of you stepping away from work to focus on family or other things? All of these are questions that can significantly impact your financial situation and warrant in-depth conversations.

Organization. You’ll need to keep and have access to important documents, like your new marriage certificate. It’s important to create a system for keeping your documents, like a family-record organizer, and determine if one or both of you will be responsible for maintaining it. For important online documents and accounts, remember to have each other’s passwords easily accessible when needed. Also, plan to update your financial statements together every year as a commitment to your marriage and your financial health.

Unforeseen events. Life happens, and none of us has a crystal ball. Job losses, health challenges, accidents and unanticipated family needs can all wreak havoc on your finances. You can get ahead of the curve by expecting the unexpected with a healthy contingency fund.

Details. Specifics are your ally in managing finances effectively. You can drill down into the details by:

  • Compiling a net-worth statement that lists what you own and what you owe
  • Preparing a monthly cash-flow statement showing income and expenses (loan payments, utilities, housing and health care costs, etc.)
  • Developing an annual budget that allocates resources to bills, savings, insurance, vacations, gifts, etc.
  • Maximize the benefits through your employer such as 401(k), life, disability and HSA
  • Obtaining credit reports for you and your future spouse
  • Protecting yourself from identity fraud by having cyber security protections in place
  • Creating or updating wills and health care proxies
  • Reviewing and updating beneficiaries on your financial assets (individual retirement accounts such as 401(k)s or 403(b)s, life insurance, annuities, etc.)

Fact is, money issues can test a marriage. Set yourself up for success as best as you can by having open and honest conversations with your future spouse to curtail many potential concerns about money down the road. Each layer of your journey together will most likely see gains as well as financial challenges. Have a plan for that journey so that your happily-ever-after has the sweetness to it that you want. You can still have your cake and eat it, too.

Photo by Anne Edgar

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Lisa Taranto Schiffer

Lisa Taranto Schiffer

Lisa Taranto Schiffer is a Financial Advisor with the Global Wealth Management Division of Morgan Stanley in Atlanta. The information contained in this article is not a solicitation to purchase or sell investments. Any information presented is general in nature and not intended to provide individually tailored investment advice. FA will not transact business in states where she is not registered or excluded or exempt from registration. The views expressed herein are those of the author and may not necessarily reflect the views of Morgan Stanley Wealth Management, or its affiliates. Morgan Stanley Smith Barney, LLC, member SIPC.

Lisa Taranto Schiffer

Lisa Taranto Schiffer is a Financial Advisor with the Global Wealth Management Division of Morgan Stanley in Atlanta. The information contained in this article is not a solicitation to purchase or sell investments. Any information presented is general in nature and not intended to provide individually tailored investment advice. FA will not transact business in states where she is not registered or excluded or exempt from registration. The views expressed herein are those of the author and may not necessarily reflect the views of Morgan Stanley Wealth Management, or its affiliates. Morgan Stanley Smith Barney, LLC, member SIPC.