Merging your money when you marry
The first step in mapping out your financial future together is to discuss your financial goals. Make a list of your short term goals, as well as your long term goals, then determine how important each is to you. Once you know your goals, you can begin planning your finances.
Planning a Budget
Prepare a budget (monthly, annually, etc.) that lists all of your income and expenses. Add up your expenses and income and compare the totals. Hopefully, you will find that you spend less than you earn. If not, review your expenses and see where you can cut down on your spending. You can designate one person to be in charge of the budget, or you can take turns keeping record. If you choose to take turns, be sure to decide on a system that works for both of you.
Joint Accounts
A question that many married couples face is whether to combine bank accounts or credit cards together. Having one joint account can mean lower maintenance fees and easier record keeping, although it may be difficult to keep track of available finances if both partners have access to the account.
When you and your spouse have a joint credit card, both of you will be responsible for 100% of the debt on that card. If one person has poor credit, it can negatively impact the credit rating of the other. One option to avoid this is to make one partner an Authorized User. An Authorized User is not a cardholder and is not liable for the debt, but has account privileges.
Health and Auto Insurance
If both you and your spouse have separate health coverage, review each plan to see if you should continue to keep your coverage separate, or combine to save money on premiums. Be sure to also compare the rate for one family plan against two single plans.
Now is a good time to re-examine your auto insurance also. Combining your auto insurance could mean multi-car discounts. Just make sure that changing companies won't mean paying a high premium.
To learn more about Veridian Insurance, contact one of our professionals today.
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