Merging Money Tips Before Marriage
Agreeing on how finances are managed in a household is one of the most vital components of a marriage, and when couples don’t see eye-to-eye on their financial matters, the results can take them down a rocky marital path. Investopedia offers several topics to discuss before getting married:
A potentially dangerous decision when considering dual incomes is to continue treating each person’s income as his or her own. Doing things like dividing expenses can lead to resentment and erode the financial benefit of having dual incomes.
Couples ready to get married should consider each other’s debt status. Does one person have more debt than the other? Is one partner debt free? Debt in general—especially if it is unequal—can cause problems when considering spending habits and income.
Some people are savers, and some people are spenders. Which are you, and which is your future spouse? Figuring this out and having a conversation about it could help with future financial issues.
Work as a Team
Sometimes when one spouse makes more money than the other, the higher (or only) earner tends to dictate how money should be spent. Couples should work as a team in working through money matters. For example, the earner can delegate the spending decisions to his or her spouse as a way to work together in the earning/spending scenario.
When you consider everything from diapers to college, raising children can be an expensive endeavor. Couples should discuss and agree on whether they want children, and how to plan for child-related expenses when that time comes. In addition, teach your children how to manage finances responsibly when they are young to guide them into financial independence as they grow older.
Sharing with Extended Family
There are often times when extended family might need a financial hand. Before helping extended family members, discuss with your spouse to ensure you both agree on the justification and amount of financial help.