By Holly Kylen for Bridal Guide
Put yourselves on the right financial path with these tips from ING wedding finance expert Holly Kylen.
Don't dodge the debt
Make sure all the financial skeletons come out of the closet before the big day — discuss school loans, credit card debts and other prior obligations (child support or private loans). As uncomfortable as this topic might seem, you don’t want any unexpected surprises when it comes to debt obligations. Your debt — and your partner’s — impacts not just your collective bottom line, but also your ability to jointly make financial commitments, like buying a first home.
Take a financial inventory
Now is the time to have a heart-to-heart with your future spouse about his financial past, present and future. Talk about retirement and other savings, whether you have wills that need to be updated and work benefits such as retirement accounts, health and life insurance and disability benefits. Explore whether you can save money by going on each other’s health insurance after marriage and consider whether you may need disability insurance to protect your paycheck if one of you becomes disabled and can’t work. Also ensure you are both contributing enough to your workplace retirement plans to take advantage of the employer match.
Take notice of whether your future spouse spends money frivolously, frugally or somewhere in between. Dinners out, expensive vacations and buying the latest “it” item can reveal a careless approach to money. On the other hand, your partner might be frugal, ordering the cheapest item on the menu or splitting the bills down to the penny. Turn the microscope on yourself as well to identify your money personality. Tuning into these clues can help you set realistic expectations for yourself and your partner.
Create a support network
Your financial inventory should also include financial professionals who can support you as a couple in working toward achieving your financial and retirement goals. If you already work with an accountant, attorney and/or financial advisor, make sure your partner also establishes a relationship with them — and vice versa. If neither you nor your spouse has ever consulted with a financial advisor, now is the perfect time to find one together.
Look ahead to the retirement horizon
Growing old might seem like it is years away, but planning for retirement doesn’t happen overnight. If you and your fiancé are already saving for retirement through an employer-sponsored retirement plan or individual retirement account (IRA), you are off to a great start. If not, you may want to consider getting started saving for retirement and set up automatic deductions from your checking account or paycheck directly into a retirement account. This is also an opportunity to talk about your collective budget and make sure retirement savings is a shared priority.
Think about 'til death do us part
It may be in the marriage vows, but “death” is not something any bride wants to consider before marriage. That said, marriage is a major event that entails joining you for life with someone else. Protect each other through life insurance and update your beneficiary information on financial and retirement accounts.
Establish your roles
You don’t have to figure this out right away, but start to talk about how the two of you are going to divide household finances. Perhaps you pay the monthly bills and day-to-day expenses, while your spouse handles the insurance and retirement savings, or vice versa. Figure out each other’s strengths and natural abilities and play to those in how you divide up the financial responsibilities.
Be each other's biggest cheerleader
Make sure you are each other’s biggest support when it comes to making financial decisions. Confide in each other and offer constructive advice. If the financial inventory uncovers debts or other financial challenges, figure out how to tackle the issues together as a team. Don’t forget to celebrate your successes, too. Promotions, raises and reaching financial and retirement goals are milestones that deserve recognition.
Holly Kylen is an ING Retirement Coach and financial advisor at ING Financial Partners, where she developed a Retirement Planning for Women seminar. She also serves on ING’s Women’s Advisory Network Board.
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