Marriage is an exciting milestone for couples, but after the cake is consumed, the guests go home and the honeymoon ends, the minutiae of paying bills and saving for the future may seem less than glamorous. Nowadays, many couples cohabitate before marriage, so they may already have joint bank accounts or even a mortgage together. Some couples wait until after the wedding to pool funds, while others choose to keep their money entirely separate.
For those who combine at least some of their finances, there are likely to be a few hiccups, especially when spouses are further along in their careers and may have money habits already ingrained. eHow talked to Susan Zimmerman, a Chartered Financial Consultant and a Licensed Marriage & Family Therapist who runs Minn.-based financial planning firm Mindful Asset Planning, about potential pitfalls for newlyweds to avoid.
Treating money as a “one and done” conversation.
If you and your spouse participated in premarital counseling or signed a prenuptial agreement, you probably discussed your assets, liabilities and financial goals. But the conversation shouldn’t end there. “Couples who are anticipating a life together should look at what kinds of messages and lessons did they get growing up and were those lessons useful,” Zimmerman says. “Start by understanding that about each other.” Your financial goals and attitudes may evolve, so keep the lines of communication open and check in with each other so you’ll understand where the other person is coming from.
Hiding purchases from each other.
Zimmerman says gaps in financial knowledge can be overcome, but deceit is much worse. And it’s a lot more common than you might think: a study published on Valentine’s Day 2014 by the National Endowment for Financial Education found that one in three adults admitted to committing “financial infidelity” against a partner. “When you’ve picked up on ways you might be different and instead of talking about it, you then decide to be untruthful with each other,” Zimmerman says. “Bad habits tend to get worse, not better, because new circumstances arise.” For instance, a wife who worries her husband will disapprove of her shoe habit might order online and have the shoes shipped to her office. Or a husband might hide a gambling habit from his wife. Some couples avoid this guilt by setting a dollar amount that the other person can spend guilt-free but agree to consult each other on larger purchases.
Jumping into home ownership without understanding the costs.
A growing number of couples are buying real estate before they tie the knot, and those who haven’t yet may see home-ownership as the next logical step. But just because your parents had the idyllic suburban home with the white picket fence doesn’t mean it’s right for you … right now. “Our culture has a fondness for this American dream of owning your own home, but there are real pains and consequences that come from it,” Zimmerman says. “You no longer have somebody else paying for the maintenance and care of it. We’ve seen many people get into trouble [with real estate purchases].” Just because you pay X amount in rent each month doesn’t mean you can comfortably afford the same size mortgage payment, because you’ll have property taxes, maintenance and other costs that aren’t associated with renting. Consider running the numbers with a fee-only financial advisor before you start shopping for your dream home.
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