No, it's not for me. I've been down that road a few times already. Enough! But, at this time of the year with a slow creep toward June, the magazines and newspapers are filling with photos of June brides. After all, the majority of the weddings in this country take place in June. Up to now, there are all kinds of planning and compromising taking place. And even though most couples can pretty much figure out what to do with the number of invitations and whether it will be fish or chicken at the reception, a goodly number can't seem to get their arms around any sort of financial plan.
And this can be a problem.
Most, if not all, financial planners worth their weight, will advise any couple to discuss financial goals and priorities before walking down the aisle. For one, suppose you have one partner with tons of debt? Clearly, a decision would have to be made as to how to handle those debts. Will it be commingled with the assets of the couple?
What does seem to be going on today, and I've seen it in my own family, is that rather than simply pooling all the money into one account, each partner maintains a separate account and contributes to the main household account. How does this work?
Each partner in the impending marriage will have his or her own bank account and the household expenses will then be split with each partner ponying up what is necessary. In this manner, say many financial planners, the husband can't argue about what the wife spends for a new dress and the wife can't complain about the husband's latest golf club. As long as the household expenses are met, then it is fair game for the individual partner to do whatever he or she wants with their own money.
This is usually a big aid for younger couples who may have college loans and credit card debts to handle, and certainly is helpful for those on second or third marriages--in which case a pre-nuptial agreement is generally the best plan.
Of course, the couple can work toward building a life together and might just want to contribute to a separate or third account in both their names.
It's been said over and over that setting financial priorities and goals can serve as the framework for a couple's long-term financial plans. In effect, they should have a laundry list of what is owed and what is owned. In this way, they will know exactly what they have to spend on vacations, hobbies, and the like. In effect, both partners stay on top of all the assets of the marriage and not simply their own.
Of course, when we talk about financial goals, we are really spinning on whether they refer to short-, mid-, or long-term goals. Obviously, these differ depending on the age of the couple. For instance, to a young couple, say in their 20s, the idea of retirement may look enticing rather than plodding to work each day for the next 40 years, but it is really something way in the distance…after, of course, the home, car, kids, pets, and the like.
What sometimes gets in the way here is when both partners are working and therefore, tend to spend beyond their means. They look at payments and ignore what the total cost may be. For example, the purchase of a car may take out half a year's income although the lenders will zero in on the monthly payment amount. However, when this amount is stretched over a considerable period of time (which is what lenders love), the total cost is way more than buying the car with cash upfront.
Clearly, saving for retirement is vital in today's world and those young people, in particular, who are getting ready to walk down that aisle in few months, should recognize that just a minimal amount put away regularly will, over time, grow to a substantial amount. Time passes rather quickly (take it from me), and although it doesn’t seem that way to the young bride throwing the bouquet right now, it will be quite apparent before too long.
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