Money and Marriage: The Essentials

Finances are a personal matter – until you get married, when they are suddenly thrust into the public realm and are shared. This can be an awkward transition for many people, but there are some strategies that can help.

Once married, decide how the money is going to be managed. Sharing money in a checking account is an important part of the communication and mutual respect required to make a marriage work. Discuss your personal needs and expenditures. It might seem insane to you that your husband wants to spend money on power tools or video games, but he likely doesn’t understand your need for salon appointments. Talk together and support each other, deciding how much you can afford to spend.

Many experts support the “yours”, “mine” and “ours” tri-account system for two income families. Both partners contribute to the “ours” account, and can work together to determine the household budget.

Both partners should also contribute towards retirement and other savings accounts. The easiest way to do this is to set up direct payments from your bank accounts – the money is automatically withdrawn each month and you don’t have to think about it. If you are making different salaries, you can each contribute the same percentage of your income to savings and investment, rather than the same dollar amount.

Without dwelling on statistics that suggest one in two marriages will end in divorce, there are some smart and practical reasons to consider a prenuptial agreement that have nothing to do with splitting the assets if the marriage ends.

If one or both partners are bringing substantial personal debt into the marriage, it makes sense to agree that, in the event of divorce, the other person isn’t left holding half the bag. In this sense, prenuptials protect against people becoming responsible for their spouse’s dealings before marriage.

Some similar concerns might include providing for children from previous relationships, keeping pre-existing businesses running and out of the divorce proceedings and protecting the family home in the event that the marriage ends.

Conditions that precede the marriage can have spillover effects should you divorce, and prenups can ensure that your prior needs and responsibilities aren’t sacrificed. Full financial disclosure is important, so that you both know what you’re getting in to.

Useful Resources & Links:

• Financial Advice for Couples 
• Don't Let Your Money Ruin Your Marriage 
• How To Communicate Effectively With Your Spouse About Your Finances 
• How To Budget as a Couple 

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