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Financial Rules Newlyweds Must Follow |
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Written by Dorthy Weatherbush
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Monday, 07 December 2009 09:39 |
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Couples getting married are so full of hope, excitement but must remember that the number one cause for divorce in this country is finances. That being said, there are five different financial items that newlyweds need to discuss when they get married: 1. financial debts, 2. financial goals, 3. opening accounts, 4. making a budget, 5. deciding who is going to act as accountant for the family.
by DorthyWeatherbush
Couples getting married are so full of hope, excitement but must remember that the number one cause for divorce in this country is finances. That being said, there are five different financial items that newlyweds need to discuss when they get married: 1. financial debts, 2. financial goals, 3. opening accounts, 4. making a budget, 5. deciding who is going to act as accountant for the family.
The first thing that any newlywed couple or couple about to get married needs to do is to understand what they will be bringing to the table financially. So they need to value what they have together in total assets which includes investments, bank accounts, cars, electronics, properties, and anything else that will fetch a price. This will give the couple a good idea of where they are starting out financially together.
Discussing the automobiles they currently own, one should also look at how long they expect to hang onto that automobile, and how they plan to purchase a replacement when the time comes? This is part of their financial planning, and does need to be included as an important expenditure.
Couples also need to understand how much money each partner brings in. Things such as income from working, annuity payments and interest payment should be discussed so that the couple understands how much total money is coming into the house.
Next, one needs to look at debt. This covers everything that the couple owes on. Mortgages, rents, credit card payments, student loans, anything that requires a steady payment, even car insurance, home insurance, life and disability insurance and the like needs to be carefully assessed by the couple. For some reason many newly married couples forget credit card payments that need to be made. This is usually because they carry such a high balance that they've put it out of their minds so as not to "worry" about it.
The home's equity, if they own a home, is of tremendous significance as well. First, they need a place to live, but secondly having equity in a home is one of the easiest ways to eventually accumulate wealth. Have the couple find out what their home's actual fair market value is. With the advancements in what is located on the Web, they can look over what similar homes were sold for, themselves. Equity is the difference between fair market value and what remains to be paid in mortgages and such. They must be sure to look at equity loans too when arriving at the home's equity.
Anyone helping a newly married couple with the financial side of their new status needs to be sure that they have opened a joint banking account. The account should be an "or" account but never an "and" account, so that either one can withdraw and use the account.
Any outstanding retirement accounts that the couple has should be changed to reflect the new spouse as the beneficiary. If life insurance is going to be purchased, the couple needs to discuss how much the policy should be for and again should list each other as beneficiaries.
Retirement packages should also be considered if they have none. For instance, most newlyweds should look into a 401k for retirement.
About the Author:
Dorthy Weatherbush didn't have TheKnot.com to help her plan for and get ready for marriage. With the help of TheKnot.com couples now have lots of resources to not only help them plan for a wedding, but for marriage, kids, and the couple's first house. |
