Newly Wed Or Thinking Maybe? How About The Joint Finances.

Months ago when the virus took hold it looked as if marriage rates might tank – continuing a 100 year low. After all, a lot of couples were postponing big weddings. As it turns out, though, in a number of counties more people applied for marriage licenses than in years past.

Couples are now exchanging virtual vows with face masks via zoom, mini/micro weddings, and at least one groom reportedly holding a can of disinfectant. This commitment to love in a time of social distancing is uplifting so here’s a much needed and practical wedding present — essential financial advice.

Before exchanging “I Do’s” — Open the books to important financial info.

Yes, this first piece of advice involves discussing your finances with your future spouse - ideally - before you wed. If that makes you cringe, consider this: someone who loves you wants the two of you to become a financially secure team. And it’s not possible to become financially secure if you’re not aware of the size of the assets or debts.

Start by sharing your credit scores. Remember, you are planning to share your lives – so it’s not a big deal to exchange and access your credit reports at annualcreditreport.com. If one of you has a low credit score, it’s important for the other to know and know what is causing it. Maybe it’s a steep medical bill. Knowing helps you avoid dealing with any unpleasant surprises later on and paves the way to discuss a strategy to pay down that debt. Eventually, you will develop a credit history together – when you apply for a joint loan for a big purchase – a car or a mortgage. If one of you has debt you may be charged a higher interest rate than if you both had strong credit ratings.

Become a Beneficiary

Look over all your legal and financial documents, and make sure each of you has copies. This stack of papers should include: both of your medical directives and any life-insurance policies especially important during this coronavirus time. It should also include the statements for all bank accounts, retirement plans, and personal investment accounts. Once married, it’s important that you are listed as each other’s designated beneficiaries on these accounts — unless, of course, there’s a reason not to include you. Finally, you should draw up a will and perhaps a trust.

Here’s something else to consider: who will pay the bills?

It’s likely that day-to-day decisions will need to be made about who pays bills that are in both names. To ensure that they’re paid on time, share the info for accessing the bank account that you will use to pay them from. If the bills are paid late, and in both names, it can adversely affect both your credit ratings.

As committed as you both are to the relationship retain some financial independence.

If in the future something unexpected happens, there could be a situation where you may need to be able to take care of yourself. To do this, maintain a solid credit rating; have at least one credit card in your name only and pay it off regularly. Also have an emergency savings account in your name and contribute $50, or whatever you can each month.

What if you don’t have an employer-based - retirement savings plan.

Ensure you do not become financially disadvantaged by not saving for the future – if eligible, you can open up a Roth IRA - individual retirement account and make sure there’s money in the budget for you to contribute monthly, or at the least annually, at tax time. This is an especially important step, especially if your spouse is contributing to a retirement plan at work that they regard as their solo account.

Finally, all of the daily life issues mentioned above are just the tip of the iceberg that couples encounter together. One of the things that we all hopefully get better at is dealing with slightly difficult or what we once might have considered boring problems. But, these financial decisions are critical, and having a handle on your finances — shared and separate — is key for you both, and for your future.

By Cindy Hounsell, Contributor