Ever seen a financial how-to book at a wedding shower? Me neither. But I’ll bet “how to handle finances when you’re in love” workbook would get way more use than (another) china gravy boat.
In my experience as a financial expert, newly married couples don’t really want to have the money talk. Money is a topic that many of us would rather not jump into, but we need to — especially with our partner.
Regardless of how long you’ve been together as a couple or how you may have split finances, getting married changes more than your tax filing status and the state of your china cabinet. When you commit to one another, it’s also a good time to commit to your mutual financial goals as a couple, especially if things have been relatively smooth sailing, financially speaking.
#1 Set financial roles
The classic “who’s doing what” is an integral part of any couple’s financial plans. Think about your career – you have a specific job with specific tasks so that everyone isn’t trying to tackle the same goal. This same concept applies in your married life, and with help, you both avoid any confusion over who is doing what, and ultimately, prevent any silly fights.
When I was a newlywed, my husband and I were both trying to reconcile our finances separately. It was hysterical because we would both come up with different numbers for how much we spent on items each month and it created a mess. Finally, one day I realized that this madness needed a plan.
I became the CEO of our finances, dealing with what was going on in our finances day-to-day, while he became the Director of Goals, keeping us on track of our goals each month. You Need a Budget (YNAB) was also a lifesaver for us. We both had responsibilities for our spending and saving habits, but the separate roles gave us clear direction. Full disclosure – my husband is not a finance person, and I am, but even if you have no finance experience, you can still be successful in delegating roles if you remember to play to your strengths.
Some couples want to keep their finances separate or have separate bank accounts and joint savings accounts or create a joint emergency fund. There’s no wrong way to partner together on your finances, but you should set up clear financial roles and a system, so you make sure you’re both headed in the same direction.
Financial roles checklist:
- Write down your strengths and weaknesses when it comes to money and compare them with your spouse’s strengths and weaknesses
- Assign financial roles to each person with clearly defined tasks
- Calendar weekly money dates while doing an activity that you love like wine tasting or an afternoon picnic to check in on your finances together, or something simple like a coffee date if you prefer a quick 5-minute check-in.
- There are lots of resources out there to help you get on the same financial page. If you’re into reading – find a book that you both like such as Work Your Wealth. If you’re into podcasts, I host Millennial Money, a podcast that is focused on all sorts of money-related topics. Blogs such as Making Sense of Cents can also be a great place for financial inspiration.
#2 Create joint goals
Now that you’ve set your financial roles, it’s time to set your financial goals. We all live distracted and busy lives, so it’s easy to lose sight of what you want to achieve. Creating a list of joint goals – they can be anything such as saving for a down payment to buy your first home, paying off your student loan debt, buying a new car, or splurging on your dream vacation. Make sure your goals are well flushed out which will enable you both to make decisions with your finances that move you in the direction of accomplishing them.
The most important thing to remember when setting goals is that they should be flexible and can change from month to month. Life throws all sorts of curve balls at you once your married and your goals might be in flux as well. By visiting your goals together at least once a month, you can stay open to the changes and embrace new goals as they arise. If you are looking for a little outside perspective on overwhelming goals like buying a house, tackling student debt or paying down your credit cards, you can always hire a CFP® professional for a session or two to help you flush out your goals and set an action plan to achieve them.
Joint goals checklist:
- Create a list of three short-term and three long-term goals that you both would like to achieve. You can each have separate goals and joint goals on the list.
- Make sure you give the goals some definition – when you want to achieve them, how much the goal will cost, and an action plan for success.
- Your goals can change often, so keep your list handy and flexible. Some couples like to keep their goal list on the fridge for a constant reminder, while others like to use budgeting and goal setting programs like You Need a Budget. Find whatever works for you both.
- Incorporate each goal into your joint budget so you remember to save each month towards that goal
- You might even want to open a joint goals savings account or multiple accounts for multiple goals
#3 Get life insurance
Now that you’re married it’s time to think about the risks to your financial future. You’ve formed a marriage partnership and a financial one (even if you keep your finances separate). Most couples adopted a new lifestyle based around your joint income and goals which usually means more bills to pay. If one of you were to die, the other person could be left to pick up the financial obligations.
Being a newlywed is a great time to talk about life insurance (don’t worry, it doesn’t have to be a morbid conversation). Fact: term life insurance is usually more affordable the younger and healthier you are, and a policy payout could help your spouse continue making mortgage payments, pay for childcare, or cover other expenses with a financial cushion if you were to die.
Life insurance checklist:
- If you already have life insurance, great, make sure you update your beneficiary to your new spouse
- Determine how much life insurance you would need to replace each other’s income
- Figure out what type of life insurance is best for you
- Remember, if you have a policy through work, it isn’t portable. That means if you leave your job you also leave your life insurance so it may be a good time to consider researching other policy options.
#4 Pick your health insurance (and any other insurances)
One of the decisions you’ll make as newlyweds is which health insurance plan is the best and most affordable choice. Should you be on your spouse’s plan or should they be on your plan? Most group health plans will allow you 30-60 days after you get married to add your spouse as a dependent. Make sure you check with your HR department to confirm how long you have before you need to make a decision.
Choosing the right plan for you comes down to the numbers, but it’s not uncommon to see couples decide to keep their health insurance plans separate as it ends up being more cost effective. There are some questions you should keep in mind as you make your decision.
Health insurance checklist:
- What are the monthly costs to add a spouse to each plan?
- What is the deductible for each plan?
- What are the out-of-pocket limits for each plan?
- Which plan covers the majority of the doctors you visit?
- Which plan would make sense if you had a baby?
Once you answer those questions, you should have a good feel for which plan would make more sense. It’s easy to stop at the monthly insurance premium, but the answers to the other questions are equally as important. For instance, one plan might cover the cost of in vitro fertilization or other fertility treatments that can be super expensive if paid out of pocket. Or, one plan might allow you access to a broader network of Doctors and Specialists than the other plan. Be sure to think through each option carefully.
It also may be a good time to look into other insurance options, such as disability insurance. Remember: Now that your lives are joined, so too, are any risks you may incur, so it’s smart to play the what-if scenarios now and make sure you’re covered were the worst to happen.
#5 Choose a fun savings goal
You’ve got your goal list in check. Now let’s talk about coming together and creating a fun savings goal. Think of your fun savings goal as something to break up the monotony of paying bills month after month. Do you have a big vacation you want to go on — somewhere amazing like Bali or Paris? Maybe you’re saving for a down payment for your first dream house together. Some couples create a fun savings goal around luxurious date nights once a month. Don’t let existing debt get in the way of creating a fun savings goal either – it doesn’t have to be anything extravagant. Your savings goal can be anything, but the idea is to create a bonding experience by working together to achieve your fun goal.
Fun goal checklist:
- Choose one fun goal and then outline when you want to achieve it and how much you need to save each month
- Be smart with your savings – think about opening a separate high-yield savings account to get an extra bump in interest towards your savings
- Check in on your fun goal during your weekly money dates to make sure you’re on track
- Once you’ve achieved that fun goal, set a new goal and start saving
Make it your own journey
This shouldn’t feel like a to-do list only slightly less daunting than (finally) getting around to those thank you notes. Two minds are always better than one, and you can use your joint powers to start making smart money moves for both of you. You don’t have to tackle these moves all at once. However, it’s a good idea to begin the conversation around money and work to get on the same financial page as soon start your life as newlyweds.
Shannah Compton Game is a CERTIFIED FINANCIAL PLANNER® professional with an MBA and is the host of the award-winning podcast, Millennial Money, where she shares totally relatable and easy to understand financial advice that will actually make you want to talk about money.
Haven Life doesn’t provide tax, legal or investment advice. This discussion is intended as general education only. We encourage you to work with your own personal tax or legal professionals and your financial advisor. Opinions expressed by the author are their own, and do not necessarily represent the views of Haven Life.