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Marriage isn’t just a romantic commitment. It’s a huge financial one as well. If you’re going to reach your long-term goals, you’ll need to work as a team with your future spouse. To make sure you’re both ready, here are the top 10 things you should know about each other’s finances before you walk down the aisle.
What is your fiancé’s credit score? Have they run into credit problems in the past like missing payments on loans or keeping large balances on their credit cards? When you apply for loans as a married couple, especially the mortgage on your first home, lenders are going to look at both your credit histories, so you need to know where you both stand before applying.
It’s never too early to start planning for retirement. Has your fiancé started putting any money aside? Does he or she have any retirement plans at their job like a 401(k)? These plans offer helpful tax benefits so it’s important to know what accounts you’ll be able to invest in once you’re married.
What kind of valuable property does your fiancé own? Things like real estate, a car, stocks or an ownership stake in a family business would all give the two of you a head start towards building wealth as a couple.
Does your fiancé have any large unpaid debts? If so, part of your budget as a married couple is going to go towards paying these off. Make sure to ask about student loans as the average college graduate now leaves school with nearly $30,000 in debt according to a 2012 report by the Institute for College Access & Success.
How does your fiancé feel about managing money? How comfortable do you feel managing money? Will only one of you manage your household bills and financial planning or is this something you want to work on together?
Does your fiancé use any sort of budget to track their spending? How much of their income do they save each month? Fights over money are common, especially if one person is a natural saver while the other is a spender. Create a budget for your family that is a compromise between both your styles.
Has your fiancé ever been in a situation that required him to declare bankruptcy? This stays on a person’s credit report for up to 10 years and would make it harder for the two of you to qualify for loans.
How much does your fiancé earn compared to how much you earn? How do you plan on sharing your money as a married couple? Do you want to split everything 50/50 or would your rather keep some money in separate accounts?
What does your fiancé plan on doing with their career? Do they see themselves working throughout your marriage or are they thinking of becoming a stay at home mom or dad? Is it possible that your family might have to travel for your spouse’s career?
What kind of health insurance does your fiancé have? Does one of you have better health benefits? It may make sense to join the best plan as a married couple. If your fiancé owns a car or house, do they have the right property insurance in place? It might also be a good time to consider life insurance, especially if you are thinking of having children.
More than anything, you want to ensure that you and your fiancé discuss items like these BEFORE you get married. Half of your stress can be eliminated just by making sure that you and your future spouse are of like mind when it comes to finances. You don’t have to agree on everything. But you want to ensure that you share similar viewpoints when it comes to managing debt, budgeting and your future goals. A shared financial vision can go a long way toward ensuring you live happily ever after.
This article is for information and educational purposes only; does not necessarily represent the opinion of Protective Life; and, is not intended to serve as financial advice but, instead, to supplement other information specific to your situation. For information about Protective Life and its products and services, visit www.protective.com.