Sunday, May 20, 2007

Newlywed financial tips

Today is my sister's bridal shower. I am 99% sure she knows, she hates suprises. This is the girl that would unwrap her Christmas presents and then rewrap them!! As her and new soon to be husband settle down in married life, I thought I would share some financial tips for newlyweds (or marrieds if you haven't done this yet)

1. Know where you are going. As soon as you set a date to start your life together, begin sharing intimate details about each others financial life. If you find both of you hate financial planning you can decide who will do what now. It will not be any easier now than it would after your marriage, but there is less pressure to "just do it" and get it over with.

2. Share the news with the Government. Visit the Social Security website at for information on replacing your old Social Security card if you are changing your name. Also don't forget the Department of Motor Vehicles to change your driver's license. If you have other dealings with state or federal agencies, you will want to change their information about you as soon as possible to avoid any problems later.

3. Hang onto your marriage certificate. Before you put this little piece of paper away somewhere you "won't forget it", keep it handy the first year to show as proof of your nuptials. Financial representatives can not accept a picture of you cutting cake at the reception, and some airline frequent flier miles programs won't update your information unless you have a legal document as proof.

4. Consolidate to save money and arguments. The two of you are married now, act like it financially. You do not need separate checking accounts for separate paychecks to pay for merged bills. By having one checking account you may save on bank fees. To overcome the risk of checks not being recorded, use checks with the duplicate feature and put both of you on a cash allowance. This will help prevent over-use of the check book and arguments about where the money went.

5. Make a financial date night. Choose a night early in the month after all the bills have arrived and spend some time paying the bills together. One writes out the check, the other records the payment and stuffs the envelope. Use this time to discuss finances, goals and clear the air about concerns you may have. These date nights may lead to deep discussions about personal goals, household responsibilities, or even career plans, so listening is critical.

6. Re-evaluate your insurance coverage. Changing your marital status may lower your auto insurance premiums. Employer provided health plans may be consolidated under a family plan, or is it more advantages to maintain individual plans? Do some looking around and get quotes on your health and auto insurance needs from multiple sources.

7. Other insurance considerations. Now that you have a family, do you need more life insurance? Nobody likes to think about it, but disability income and life insurance policies can greatly reduce worry and stress on a family in the event an accident or premature death occurs. The advantage to buying life insurance while you are young is the lower cost. Buying 20-year level term insurance can be a more inexpensive method of buying protection during the time your children are still living at home.

8. Will you, or will you not? If you die without a will, the passing of your assets to your heirs is determined by a judge who determines how much of your assets go to your children, your wife, your father, your uncle, and every other relative who thinks they have a claim to your estate. A quick trip to a lawyer for a small fee, or an hour with a good computer program should put your mind at ease that your family will be taken care of the way you want. Planning on estate division can raise difficult issues, but this is a vitally important thing to do for your loved ones.

9. Promises, promises. You promised love at your marriage ceremony, no make some further promises. Promise to consult each other before making major purchases, setting a price as to determine when discussion needs to occur before the purchase. It doesn't matter if the sports car you have always dreamed about is being sold right now, if you cannot talk to your spouse about it, don't buy it.

10. Respect each other. It is normal for you to not always agree with your spouse about money. This doesn't mean someone has to be wrong and have their resistance worn down. Listen to their opinion and respect their right to have it. You never know, their idea may be better for your family.

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