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Managing money together ?
Once the honeymoon tan fades, you’re reminded of all the post-wedding chores that need to be completed. Send thank you notes, update marital status on legal documents, and (eventually) head to the bank to figure out how you’ll manage your combined finances as a married couple.
How you choose to manage your finances depends on your specific situation, but there are some tips for all couples to consider.
Add your spouse’s name to your accounts ?
Even if you open a joint account (as discussed in the next tip!), don’t close your personal bank account, especially if you’ve set up bill pay and memorized your account number. Keep your personal account, and add your spouse’s name to it. Now that you’re married, your assets are combined in the eyes of the law anyway (unless a prenup was involved).
Having each other’s names on your personal accounts is especially important should something happen to you or your spouse. If you’re a signer on the account, you’ll have immediate access to the funds. If you aren’t, you may need to wait until the probate process is complete to withdraw funds and close accounts.
If at some point you want to remove your spouse’s name from an account, both parties would need to be present to sign bank documents.
Open a household checking account ?
Paying bills as a couple is much more complicated when doing so from two separate accounts. Having a joint account from which all household bills can be paid makes things much simpler.
You may choose to split your direct deposit between your personal account and your household account.
How much money should I put in each account? It’s often suggested that you spend 50% of your income on necessities (rent, utilities), 30% on discretionary spending (fun, leisure activities), and 20% toward savings. Try splitting your direct deposit 50/50 between your personal and household accounts.
Add your spouse as a beneficiary on your 401(k) account ✍️
After getting married, consider adding your spouse as a beneficiary to all your financial accounts. Remember those less frequently discussed accounts, like your 401(k) and investments. While you’re at it, update beneficiaries to any life insurance policies as well.
Maintain a level of financial independence ✊
Sometimes, one partner in the marriage will become dominant when it comes to managing the household finances, and the other partner will take a backseat. Although one person may be stronger at managing money, stay involved in your finances. Be sure you know what’s going on with all your accounts. This may help avoid any hiccups should things go sour (knock on wood).
Healthy financial habits help strengthen your marriage ?
Frank Sinatra once said, “Love and marriage, they go together like a horse and carriage.” But, where does that leave money in the equation? (The reins?) Having responsible money habits can help direct your marriage down the right path. Try using these best practices, so all you’ll have left to fight about is the remote.
Stay tuned for our post on how to manage debt as a couple, and find out when you start to owe your spouse’s debt.