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Marriage and money: The other big questions to pop

Don't avoid early conversations about budget and savings. It could prove costly later.

Hands with engagement ring embracing man

When getting married, the cost of throwing the wedding isn't the only money discussion you and your significant other should initiate before walking down the aisle.

It's important to have frank discussions about finances and your views on handling money. These conversations may be uncomfortable at first, but avoiding them could prove much more costly down the road: Money problems are one of the leading causes of divorce.

"If you can lay it all out and meet halfway, you can set yourself up for a successful financial relationship, as well as a stable emotional relationship," says Joshua Mungavin, CFP, a financial planning analyst for Evensky & Katz Wealth Management in Coral Gables, Florida.

And it doesn't have to be a stressful experience. Establish an open dialogue by "discussing goals and aspirations, and what it will take financially to get there," says Mungavin. "It's a good way to ease into the overall conversation that doesn't require a direct confrontation."

Mungavin recommends including these topics in your conversation:

Account structure

Will you merge all your accounts, keep individual accounts, or create a mix? How will you title the accounts?

Spending and saving habits

Spenders and savers can peacefully coexist if you keep the lines of communication open. Ask each other:

  • Does the higher earner get to spend more?
  • Do you spend out of the joint account as long as there are sufficient funds?
  • Do you have to answer to each other for expenses?
  • Do personal expenses come out of a monthly allotment each one gets for these types of expenses?
  • Is there a specific dollar amount that requires a discussion with your significant other prior to a large purchase?

Credit histories

"Ultimately, newlyweds" credit scores will affect each other and can impact your ability to get a mortgage and buy cars,' Mungavin says. "If one partner has credit problems, it's important to discuss why these issues exist and what has changed to make sure they don't happen in the future." Learn more about the factors that can affect your credit score.

More questions

While you're chatting, Mungavin recommends you to ask each other the following:

  • Do you want and are you comfortable with a prenuptial agreement? If so, consult a qualified professional.
  • What happens with any assets held that were the result of an inheritance?
  • Who pays the bills, in what proportion are they paid and how?
  • When do you want to retire and what does retirement mean to you?
  • What will your estate plan look like?
  • What is your risk tolerance and how will that affect your investment choices?

Use a budgeting calculator to help get a handle on where your money goes. And be sure to consider how you'll protect your income and property in your discussions. Your State Farm® agent can answer your questions about life insurance, disability income insurance, and homeowners insurance.

The information in this article was obtained from various sources not associated with State Farm® (including State Farm Mutual Automobile Insurance Company and its subsidiaries and affiliates). While we believe it to be reliable and accurate, we do not warrant the accuracy or reliability of the information. State Farm is not responsible for, and does not endorse or approve, either implicitly or explicitly, the content of any third party sites that might be hyperlinked from this page. The information is not intended to replace manuals, instructions or information provided by a manufacturer or the advice of a qualified professional, or to affect coverage under any applicable insurance policy. These suggestions are not a complete list of every loss control measure. State Farm makes no guarantees of results from use of this information.

Neither State Farm nor its agents provide tax or legal advice.


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