When you think of marriage or weddings, finances are not one of the initial thoughts one may have. Starting a life together includes considering your finances as well as your spouses, including financial goals, protection, as well as beneficiary decisions. Finances are often a subject that people tend to avoid. While these may not be romantic conversations, they are very important to have in order to have a stable financial future together.
Having an open, honest conversation about your short and long-term goals can help you understand each other’s goals and aspirations. Whether you decide to combine your assets or keep them separate, it is important to understand your partner’s goals and plan for achieving them. These goals, whether buying a house, retiring abroad, paying for future children’s education etc., can be planned for if they are actually discussed. This can help create a bond through working together to achieve a specific financial goal.
Another important factor to consider when getting married is insurance, including health, auto, homeowner’s/renter’s, and life. Insurance is an important way to help ensure that both you and your spouse will be protected. Having the right amount and type of insurance can be a major help. Talking with your insurance provider can help determine what changes, if any, need to be made.
Discussing and updating (if needed) beneficiary information is an important, yet often overlooked financial step that should be taken. Beneficiaries should be updated for any life insurance or retirement plans. While many people believe that marriage automatically makes the spouse the beneficiary of any assets, this is not the case. These changes must be updated by going directly to the company or seeking the advice of a financial advisor.
While updating beneficiary information, it is smart to establish a will or estate plan. Having a will allows a person to have a say in what happens to their assets after death. Without a will, the assets will be distributed according to law. Wills also detail who will be the caregiver of children in case of an accident. While it may seem silly to include this if you do not already have children, it is easy to forget updating a will. For example, if there is no specified caregiver, a judge will be the one to decide. Working with an estate planner can help protect you as well as your loved ones.
In order to create the best life with each other, finances must be discussed. Seeking the advice of a financial advisor can make these conversations easier. The best way to start a life together is prepared.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.
Securities offered through LPL Financial, Member FINRA/SIPC. Investment Advice offered through GWM Advisors, a registered investment advisor. GWM Advisors and Southern Point Investment Partners are separate entities from LPL Financial.