In a recent study, 88% of millennials admitted that financial decisions are a source of tension in their relationship with a spouse or partner. This could help explain why some experts say financial problems are the #1 reason marriages fail.1,2
Fortunately, couples may be able to head off many of the problems money can cause in a marriage.
10 Tips for Newly Married Couples
- Communication—Couples should consider talking about their financial goals, memories, and habits because each may come into the marriage with fundamental differences in experiences and outlook that will drive their behaviors.
- Set Goals—Setting goals establishes a common objective that both become committed to pursuing.
- Create a Budget—A budget is an exercise for developing a spending and savings plan that is designed to reflect mutually agreed upon priorities.
- Set the Foundation for Your Financial House—Identify assets and debts. Look to begin reducing debts while building your emergency fund.
- Work Together—By sharing the financial decision-making, both spouses are vested in all choices, reducing the friction that can come from a single decision-maker.
- Set a Minimum Threshold for Big Expenses—While possessing a level of individual spending latitude is reasonable, large expenditures should only be made with both spouses’ consent. Agree to what purchase amount should require a mutual decision.
- Set Up Regular Meetings—Set aside a pre-determined time every two weeks or once a month to discuss finances. Talk about your budgeting, upcoming expenses and any changes in circumstances.
- Update and Revise—As a newly married couple, you may need to update the beneficiaries on your accounts, reevaluate your insurance coverage, and revise (or create) your will.²
- Love, Trust, and Honesty—Approach contentious subjects with care and understanding, be honest about money decisions you know your spouse might be upset with, and trust your spouse to be responsible about handling finances.
- Consider Speaking with a Financial Advisor—A financial advisor may offer insights to help you work through the critical financial decisions that all married couples face.
1. AICPA.org, February 11, 2016
2. Divorce.com, 2017
3. When drafting a will, consider enlisting the help of a legal, tax, or financial professional who may be able to offer additional insight, especially if you have a large estate or complex family situation.
Creating your legacy does not happen overnight, and it doesn’t come without a strategy and hard work.
Create Your Vision
You should have an end in mind before you begin. Start by reflecting on what you value and care most about. Consider your passions and the unique skills you have. Your career and hobbies are good places to start. Be sure to ask your friends and family to weigh in. They may offer insights you don’t see about yourself.
Determine Your Legacy
Think about the legacy you wish to leave and the impact you want to make. A legacy can come in many colors. It can be financial, institutional, instructional or wish fulfillment, or the passing on of values and life lessons.
Develop a Strategy
A legacy will not happen without a blueprint and the persistent pursuit of your objective. A strategy can help you organize your efforts and keep you on the path that leads to success.
Live Your Legacy
A legacy is not only what you leave behind, but the impact you make on others while alive. Be sure to live your values with your family, at work, and in your community. Nothing is more likely to survive you than your impact on the lives you touch today.