What’s yours is his and vice versa. When it comes to the fairytale ending, it’s always important to remember that the pleasantries of life come at a price. With this in mind, we wanted to revisit a previous “Let Them Eat Cake” blog post that discussed the financial conversations that are inevitable when planning a wedding.
Money matters when deciding to become a permanent couple. It’s important to have the conversation with your honey about money and financials. If you paid for your own Big Day, this conversation has probably come up already, but if you are just starting out and navigating life as a duo, it’s definitely a conversation that must be had. Financial Representative Matthew Berault at Northwestern Mutual of Louisiana has spent years specializing and working with young couples and families to bring them into financial stability. When working towards a comprehensive financial plan, Berault encourages newlyweds the following advice.
- Set a “no judgements” ground rule
When couples first join into holy matrimony and begin to combine their finances, Berault says it is important to accept and understand each other’s financial past and share their hopes for the future. Accept baggage, personal and financial, their past and go in with no secrets.
- Assess your financial situation and individual behaviors
Berault stresses that one of the most common pitfalls couples fall into is the belief that once you combine your assets, you’ll have more net worth. This is not always the situation. He advices that couples discuss their assets, debts and the behaviors they have that caused each. Berault says this step is important because of the future option of buying a car or home together. If your credit scores are low (or one is lower than the other) take the necessary steps to improve those scores: pay down credit cards, pay loans on time, clean up errors on your credit report.
- Create a vision for your future together
Live blissfully ever after and be on the same page when it comes to your financial goals. Berault says if you want to buy a car, a house or have children then you need a financial plan that allows those dreams to become a reality. Avoid conflict later with these four questions:
-Do you plan on having kids?
-Would you like to buy a home?
-Would you like to pay for their college?
-Do you expect your parents will need help in the future?
- Develop a plan to make it happen
Berault says it’s okay OK to start with baby steps. Taking small steps to budget and save now sets up long-term financial success. He says, “Build a defensive strategy that includes an emergency fund, and relevant insurance coverage like home, renter, car, life and disability insurance. Also, be sure to update your existing policies – change your beneficiaries, health insurance coverage and estate planning documents like wills, power of attorney, and life insurance.”
It’s important to think about financial stability now to bring your fairytale ending, preferably on a beach with some wine, in the future. Start the steps now and live happily, and financially stable, for years to come.