Engaged? Know Your Future Spouse’s Money Story

If you’re planning your upcoming wedding, you probably know your spouse probably well.

However, discussing the often “taboo” topic of money and both of your expectations and history with it will help your marriage start off on solid financial ground.

 
Where finances are concerned, young newlyweds may enter into matrimony blind. With little training in money matters, either in school or at home, unresolved financial stresses may strain new marriages to the breaking point. In fact, several studies have shown that conflicts over money are a major contributing factor to divorce. To counter that result, address financial expectations, attitudes, and habits early on.
 

Here are four tips to jumpstart the conversation.

Discuss Expectations

 
Some people grow up in frugal households where every dollar must do double duty. Others are raised in families that spend freely, live beyond their means, and fully embrace a pay-as-you-go mentality. When young people from these two extremes meet and fall in love, conflict is inevitable. That’s why knowing your partner’s “money story” is crucial. Take time to learn the reasons that underlie attitudes toward finances so you can avoid or minimize emotional triggers that may lead to conflict.
 

Don’t Spend Too Much, Too Soon.

 
Avoid starting your marriage with unrealistic expectations. Before you sign a contract that may constrain future financial decisions, take a hard look at your needs and your cash flow. As a rule of thumb, keep your mortgage or rent payment below 30% of your income. If you have student debt to pay off, be willing to sacrifice a few luxuries in the short term to clear that account. Start small, save, and build wealth over time.
 

Agree on Priorities.

 
Schedule time for regular budget talks. Draft a budget to use as a starting point for negotiations. Be willing to compromise. Then hold each other accountable.
 

Prepare for Emergencies

 
Build up an easily-accessible account with enough money to cover three to six months of expenses. Make sure your spouse has a current list of account numbers, user names, and passwords.

 
 
Contact us for assistance with these and other money management questions.
 
 
© MC 2017 | “Financial Tips” are published monthly to provide useful financial information. The information contained in this site is of a general nature and should not be acted upon in your specific situation without further details and/or professional assistance. Visit www.asfinancialservices.com for more information on managing your finances with a sound financial plan.