How to Marry Your Finances When You Tie the Knot

US News

If you're getting married soon or recently tied the knot, know that you and your significant other aren't the only ones marrying. Your Andrew Jacksons and your spouse's Benjamin Franklins are also going to cohabit.

With that in mind, it's time to get out the calculator and your bank statements and start discussing the following questions.

Joint or separate accounts? There's no correct answer to this question. As Elle Kaplan, CEO and founding partner of Lexion Capital Management in New York City, says, "Different systems work for different people."

But many experts suggest having a joint account and separate accounts. "I believe a hybrid approach is the most successful," says Kelley Long, a Chicago-based money coach and member of the National CPA Financial Literacy Commission.

The joint account, Long says, is for household expenses, and the separate accounts are for each spouse to use for daily living and "fun" money. "Gas for your car, lunch with your girlfriends -- those little daily activities we all have that have nothing to do with running the household," Long says.

[Read: 5 Money Questions to Ask Before You Marry .]

But she advises that each spouse be able to see the other's separate account. It's easy to see her reasoning. You shouldn't keep secrets from each other -- now or later. If you think what you spend your money on isn't your spouse's business, your spouse has every reason to wonder what you're trying to hide.

And whatever you do, don't get or keep your own account and not tell your partner. "I've witnessed on several occasions a spouse finding out about an account down the road, and all trust is broken," says Bijan Golkar, a certified financial planner at FPC Investment Advisory, Inc. in Petaluma, California.

How will we fund the joint account? Unless you both work for the same company and have similar positions, you probably don't earn the same amount. Long recommends that the partner who earns more contributes more money in the joint account. You want to structure it so that you both have virtually equal amounts of money to spend in your individual accounts, Long says.

Obviously, once you start that approach, if one spouse wants to spend willy-nilly from the individual account and the other saves money from month to month, that's each person's prerogative. In fact, that's part of the reasoning behind individual accounts -- you don't clash in your spending habits.

It seems to be a popular strategy for couples. According to research released in March by TD Bank, which surveyed more than 1,000 Americans married or living with a significant other, 42 percent of those in relationships who have joint bank accounts also have individual accounts.

Should we share a credit card? You may want a joint credit card, and if you're both financially responsible, "it makes a lot of sense to have one credit card account to accumulate rewards points," Long says.

But she says it only makes sense if you each have similar credit scores and histories. "If one of you has a poor credit history, you'll ding the other person's account," she warns. If that's the case, Long says you may want to consider making the spouse with the poor credit history an authorized user.

Golkar echoes the same advice: "It's good practice to run credit reports on both spouses to see any weak spots before attaching the other person's name to that credit card or account," he says.

After all, you're both going to want the highest credit score possible when it comes time for landing a loan for a house, car or whatever else comes down the financial pike.

Are we updating our paperwork? Do you have a life insurance policy through work? And maybe your brother or parent is listed as the beneficiary? Time to knock them off and put your spouse in their place, Long says, adding, "Same thing with a 401(k) account. Make sure everything is updated."

[Read: 4 Reasons to Say 'I Do' to Joint Finances .]

If you don't have life insurance, and especially if your spouse is going to be dependent on your income, this is a good time to get some.

And while you may want to wait on writing a will until you have kids, Long says, you should probably at least get a living will. "If you have a head injury and your spouse is in charge, it's probably a good idea to know how you feel about being a vegetable," she says.

Do we agree that we're going to talk about money? Agreement to communicate about finances is so vital that one could argue you shouldn't get married if you can't discuss finances openly and honestly. As a 2012 study in Family Relations journal showed, drawing data from more than 4,500 couples as part of the National Survey of Families and Households, arguing about money is a top sign you're going to divorce.

"Couples should be as open and intimate financially as they are physically. And even if one partner takes the lead, both of you must be actively aware of and involved with the general picture," Kaplan says. "It's important that each of you takes the time to understand where the other is coming from, because money management taps into a lot of very personal areas of emotion, upbringing and family history."

Conversation starters. If you don't have much experience talking about finances with your partner, try discussing what Long calls the "gray areas."

It's easy to agree that the rent or mortgage payment is the most important bill, and that utilities must be paid. That's black and white. But if you want to uncover areas where you don't see eye to eye, Long suggests having a dialogue about the following:

-- Gifts. "One spouse might go crazy on Mother's Day while the other spouse might send a card to their mom. And that may be fine if you're both aware of your different styles, and one spouse won't be resentful," Long says. "But it's nice to know early on if you're on the same side."

-- Pet care. "That's a big gray area," Long says. Some spouses may feel that it's worth expensive surgeries to keep their aging dog alive; others may feel that it isn't.

-- Clothing. The amount your spouse spends on clothes may surprise you. "I won't stereotype here. There are a lot of guys who love their high-end clothing," Long says.

-- Dining out. "What you consider an extravagant meal, your partner might not," she says.

-- Entertainment. "What's reasonable to spend for a concert, traveling to see a friend or to go to a wedding?" Long says.

"For at least the first 12 months of marriage, you should sit and have an open dialogue every month on what you are both feeling," Golkar advises, citing the examples of whether you think your spouse is spending too much or if you feel your spending habits are being monitored too closely by your partner.

[See: 13 Money Tips for Married Couples .]

And if you have different ideas of what constitutes an expensive or unnecessary purchase, "set a trigger point price," Kaplan suggests. "Depending on your financial situation, it could be $20 or $200."

It's a wise strategy, particularly if you don't have your own individual accounts -- or you feel the spending is out of control in your joint account or on your shared credit card.

"The point [of the trigger point]," Kaplan says, "is that you each have some individual liberty and discretion for the smaller expenses while staying in close communication on the bigger things. Your financial future depends on working as a team."



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