FINANCES and FIANCÉES: 12 Questions to Ask Before Marrying Your Money

Did you know that money is one of the primary drivers of marital conflict and divorce?  If you’re already hitched, this probably comes as no surprise, but if you’re engaged, you may not have given a lot of though to how you’re going to mix and manage your financial futures. 

On the eve of the 2020 wedding season (albeit one in which weddings may need to be held differently than they ever have been before), I feel compelled to answer a popular question I hear from engaged couples on what they absolutely must know about each other before they walk down the aisle.

The Premarital Money Interview

Here are a dozen questions you should ask your fiance’ about finances.  (Say that five times fast!)

ONE:  Are you a saver or a spender? If you’re a saver, what are you saving for? If you’re a spender, what kinds of things do you typically spend money on? Do you give regularly to organizations, causes, or charities I don’t already know about?  Do you expect to maintain this pattern after we marry?

couple-looking-at-financesTWO:  How did you develop your financial philosophy? What did you learn about money in your childhood and teenage years? Hearing more about how your partner’s parents and extended family treated money may be very revealing. As with most things, your fiancee’ may have decided to follow in their family’s footsteps or go in the opposite direction altogether.

THREE:  Can I see your bank statement/checkbook/credit card bill? Keeping secrets from each other – about money or anything else – dooms your marriage from the start, so it’s worth the time to establish some healthy habits now.  And don’t forget to model transparency yourself and establish trust by producing your own set of docs when you make this request.

FOUR:  Where are your savings kept and how much is in these accounts?  How much more will we need to save – and how quickly – to establish an adequate emergency fund? It’s helpful to know, for example, if your partner has saved a substantial amount but the money is tied up in retirement accounts that cannot be accessed for a number of years without penalty.  If you find that you will have little to fall back on and it’s important for you to have a deep cash cushion to feel secure, you can move this to the top of your priority list.

FIVE:  What other major debts or liabilities do you have? This could include student loan debt, medical bills, personal loans (even to friends or family members), car loans, child support, and a variety of other things you’ll want to know about before you tie the knot. In many cases, your spouse’s debt becomes yours when you marry.

couple talking about statementsSIX:  Which one of us should handle the finances? If we divide the responsibility, who should do what (e.g., balancing the checkbook, monitoring savings and retirement accounts, etc.)Considering what your individual strengths and interests are, how much time you each have to focus on finances, and how much you’re willing to release the reigns can resolve many a future fight now.

SEVEN:  Will we use some kind of budgeting system (even if on paper or an Excel spreadsheet)? Talk about how you will manage and monitor your finances on an ongoing basis and how often you’ll both revisit your financial status and make major course corrections (e.g., quarterly, yearly, etc.).  You may be surprised at how much money you can sock away using a very basic cash envelope system.  Nothing fancy required!

EIGHT:  Should we combine our finances (including taxes)? With few exceptions, you should combine your funds to take advantage of compounding interest and any legal benefits you may qualify for as a legally-married couple. Ultimately, you will arrive at a system that works for both of you, but in my experience, maintaining separate accounts adds complexity, makes things difficult if something happens to one of you, and encourages secret spending and the kind of separateness that should be squashed in marriage.  Replacing references to “your money” and “my money” with “our money” also lends itself to a feeling of unity and shared purpose.

NINE:  If we combine our finances, how much discretionary income will we each have, where will it come from, and should there be any restrictions on its use? Many couples find that allotting a certain percentage or amount for discretionary (unnecessary, “wish list”) expenses is helpful and avoids unnecessary arguments about spending.

couple adding spending while shoppingTEN:  How much money would we like to put aside before starting a family? Couples routinely underestimate the cost of children.  Make sure you’re on the same page about what your income and expenses will be and be realistic about the fact that you’ll probably need a lot more padding than you’re anticipating.

ELEVENWhat is the biggest money mistake you’ve ever made?  Mike, my husband, once gave $20K to a trusted “friend” with a contact in real estate who was going to invest it and pay it back many times over.  Of course, he never saw the money (or the friend) again.  I once went in with a friend on a timeshare deal that evaporated just as quickly.  While these kinds of naive “oopsies” can be hard to admit, it’s important that you share them . . . in both directions.  Don’t focus on having made these slip-ups, but on what you each learned from your mistakes and how you plan to avoid them in the future.

TWELVEWhat financial goals are most important to you?  You may find that, while maintaining a good credit score is your highest priority, your fiance’ believes it’s more important to get out of debt or build up an existing emergency fund.  Coming to an agreement on your top 1-3 financial objectives will help you stay laser-focused on your goals and allow you to achieve them as a team.  Score!

BONUS QUESTION How does this new understanding of our financial priorities inform how we’ll plan our wedding and what we’re willing to spend on it?  Many a wise couple has set aside some of the funds they could have spent on a lavish wedding DAY and benefited from drawing on them throughout their married LIFE.

 

couple meeting with financial advisorConclusion

As you can see, there is LOTS to talk about when it comes to money!  As you discuss your answers to the above questions, be willing to share your own answers as you go, compromise when it’s called for, and stick to your guns when it’s important.  Above all, remember that combining your finances and getting on the same page about money can take time and is a normal and healthy part of learning to be successfully married.

And if you can’t agree on terms, don’t like what you hear when you have this conversation, or just want to make sure you’ve got your financial ducks in a row, get in touch.  I’ve worked with many couples to establish goals that set them on the path to financial freedom.

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(This article was originally published on June 28, 2018 but was updated and expanded for this release.)

 

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