Wedding season is officially under way, and odds are, couples en route to the altar have been fiscally focused almost entirely on the Big Day for quite some time.
But once you've said your I dos, financially (not romantically), the honeymoon's over. It's time to shift some of that energy from planning your marriage to successfully living as a legally wed duo, and that includes figuring out how you'll handle your money. After all, marriage is an economic partnership too, and disagreements over money are the top source of conflict among couples.
To increase your odds of attaining (and sustaining) marital bliss, implement these five pieces of financial wisdom.
1. Draft Your Marital Money Rules.
Financial goals and household budgets are very important, but equally so are your marital money rules. Think of this as a contract between you and your spouse regarding how you will work together financially. Determine how you'll handle the bill-paying and whether or not you'll keep separate checking and savings accounts. Also, establish guidelines for how much money you can spend without having to "preauthorize," or check in, with your significant other.
2. Live on One Salary, Bank the Other.
Perhaps you're both working now, but that may not always be the case. If you decide to have children, go back to school, or start your own business someday, that might involve one of you scaling back or getting out of the workforce altogether. Set yourselves up for those possibilities by living on one salary and saving the other. You'll have more options if you have enough savings to replace one of your salaries for an extended period without having to dramatically alter your lifestyle.
3. Get Rid of Debts.
Starting a marriage with no debt is ideal, but typically unrealistic. Many couples begin marriages with student loans or credit card liabilities. Devise a plan for reducing your debts. Start by transferring balances from high interest credit cards to one with a lower rate. If you're not able to transfer your balance, pay off either the card with the highest balance or the highest interest rate first, while paying the minimum on all other cards. Cut expenses to pay down your balances as quickly as possible.
4. Max Out Your Retirement Plan Contributions.
A financial need that's decades away might seem really abstract right now, but no one else will provide for your retirement except you. And the long-term impact of opening a retirement account now is huge, with compound interest accumulating over decades until you retire. Sock away as much as you can in your retirement plan at work and at least enough to get the maximum match that your employer offers. If you can eke out even more money from your budget, contribute to individual retirement accounts like Roth IRAs.
5. Review Your Insurance.
As newlyweds, you need protection against catastrophic medical expenses and a long-term disability. Your employer likely offers disability insurance coverage up to a certain amount as part of a group plan. But make sure it's enough to fund your and your spouse's needs in the event you can't work for a while. Life insurance can generally be delayed until you have children, at which time you might supplement your group coverage through work with either a term or whole life policy.
Put Marital (and Financial) Happiness at the Top of Your "Honey-Do" List
Just like your romantic partnership, your financial partnership is something you craft together as a couple. Take it seriously, and establish your guidelines early, even when it involves topics you might prefer to dodge. By doing so, you'll limit future arguments, and your marriage will be better off for it.
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Mindel says hiding details of an inheritance or trust fund is one of the most common lies he's seen in clients.
It's not a wise move, especially since it's easy enough for a partner to find out if they pay attention to your tax returns, Mindel points out.
Unless you also plan on also lying to the IRS about the trust fund, you'll have to report your monthly checks with the rest of your taxable income.
A California woman made headlines when her ex-husband sued her over lottery winnings she hid from him while they were still married.
Years later, he took her to court and wound up walking away with 100 percent of her earnings.
"Now, more and more states across the country are imposing penalties for spouses that fail to properly disclose financial information to their spouses," Mindel says.
If you've got money that's off the books, such as cash you're earning from a freelance or part-time job, it's not OK to stash it in a secret account your partner doesn't know about.
"People get pissed when they find statements about hidden accounts," says family law attorney Jennifer Deniger.
"A lot of married couples don't understand the concept of joint property and they think that if they get divorced, then anything they have in a solo account is theirs to keep. But the joke is on them because the [spouse] still gets half."
Lying about job loss often occurs because spouses are either ashamed of their failure or are convinced they'll be able to nab a new gig before their partner notices.
"We don't see it very often, but you hear about people that are shocked to hear that their spouse has been covering up a job loss," Mindel says. "They leave early to go to work but don't have a job to go to."
Mindel says any vice that sucks up disposable income -- like frequent casino trips or betting at the race track -- is a danger to marriage.
"We've had women [clients] who've been addicted to male strippers and spent all their money on clubs," he says.
"They end up putting financial pressure on their families because of their addiction."
Partners often hide credit card statements or past debt from their spouse, telling themselves that they'll be able to pay off their debt before it balloons.
"I find that most people have no idea how much their partners have in student loan debt, so that can be iffy when the payments need to come out of your joint income," Deniger says.
Before you tie the knot, sit down and exchange a credit history with your partner, Mindel recommends. That way, you're both on equal footing.
If you're uncomfortable coming clean about your debt, you're probably better off putting off marriage altogether.
Couples should treat marriage like a business merger, Mindel says, especially if you're planning on drawing up a prenuptial agreement.
"You've got to know the value of both companies," he says.
Plus, if you ever get divorced, a court can penalize you for not disclosing your full income and award your ex more spousal support.
If you've got kids you're not telling your spouse about, you could end up in court or worse -- jail, says Money Talk Matters CEO Taffy Wagner.
"I know of a situation where a husband did not tell a wife that he had previous children and was not paying child support," Wagner says. "The [new] wife ended up being sued because they had a joint account."
Andrew Scharge, founder of Money Crashers, says this is an especially easy lie for a stay-at-home spouse, who can cover up bill collector mail and phone calls.
"The difficult result is the loss of their home, which will come as a shocking surprise to the spouse who was unaware of their financial situation," he says.
"It can be a challenge to deal with a lying spouse, but ultimately, if the couple does not deal head-on with these issues of trust by implementing some money management tips for married couples, the couple will very likely separate or divorce."
Compulsive spending habits can wreck a marriage, especially if they're kept under cover. Some partners go as far as to send shipments to friends' houses or the office as a cover-up.
"Compulsive spenders lie about the amount of money they spend, how often they spend money and what they spend money on," says Paul Hokemeyer, a licensed marriage and family therapist.
"It destroys relationships because the non-spending partner typically has no clue over the extent of the spending that's going on and wakes up to a bankruptcy or unmanageable debt that in turns makes them feel betrayed, taken advantage of and humiliated."