A personal finance checklist for a couple who are about to start living together and get married soon after

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
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kadye
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A personal finance checklist for a couple who are about to start living together and get married soon after

Post by kadye »

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fyre4ce
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Re: A personal finance checklist for a couple who are about to start living together and get married soon after

Post by fyre4ce »

Pre-marital:

My wife and I kept our finances separate and used a spreadsheet to divide up expenses. It had four columns: boyfriend paid split expenses, girlfriend paid split expenses, boyfriend paid girlfriend expenses, girlfriend paid boyfriend expenses. I always paid the rent out of my account, so every month there was a rent charge in the "boyfriend paid split expenses" column. Then, throughout the month as we each bought groceries for the household, picked up the others car from service, etc we put our expenses into the spreadsheet, and then she wrote me a check around the beginning of the next month.

Talk about money and make sure you're both on the same page, or can at least reach an acceptable compromise.

I also helped her manage her investments, set up her retirement accounts, did her taxes for her, etc.

Post-marital:

I recommend a single joint account checking account. When my wife and I got married, we decided to keep our personal accounts and set our respective payroll systems to put a small amount of each paycheck in there. Then, we opened a joint account where the majority of the paychecks and all the bills got deposited. After a couple years, the personal accounts seem superfluous. (Although, my personal account with Chase has come in handy for wiring money, using QuickPay, etc.) Our thinking was similar to yours, it would be nice to have a personal account where we could spend out of and not feel accountable to the other person. In practice, it made little to no difference - money is fungible, and we just charge purchases to our respective credit cards. We rarely have any "splurge" purchases that would fall into that category anyway; we are frugal anyway and live well below our means. I think we will likely close down my wife's account soon but keep mine. You can try the three-account approach and see if it works better for you, but most likely you'll do best to just move to a single joint account.

Make sure to add her to your health insurance (or vice versa) as soon as you're married, if it makes sense.

Add each other as beneficiaries on all your accounts.

Track a joint budget using a spreadsheet, Mint, YNAB, etc and make sure your spending is tracking your plan.

We got a significant discount from our auto insurer (Geico) when we told them we were married.

That's all I can think of for now.
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Re: A personal finance checklist for a couple who are about to start living together and get married soon after

Post by geerhardusvos »

kadye wrote: Thu Sep 03, 2020 3:43 pm We are about to start living together and get married soon after. What personal finance advise do you have for us? Here are some of the things we already discussed.
  • Prenup for pre-marital assets and combine everything we make after marriage
  • Agree on a long-term financial goal and stick to it
  • Have small amount of money for personal spending where we don't have to get permission from each other to buy stuff we want.
  • Discuss and agree on major purchases before we buy.
What else? Many thanks!
The advice I give: If you’re getting married, combine everything. If you trust each other and you are becoming one, do the same with your finances. Document your shared goals, keep the communication going, make sure everyone is aware and has a say in financial decisions, and don’t treat marriage like a business or temporary partnership. Daily deny yourselves for the betterment of each other and your family. Invest early and often, invest in your career and continue learning, and always put your family and each other above your career and your own wants. Marriage is super tough, but it is the most wonderful thing as well. The only thing that’s going to screw it up is you, so own your mistakes and wrongs. Focus on experience and not on material things. Tell your spouse every day how much you love them. Enjoy each day!
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vtjon02
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Re: A personal finance checklist for a couple who are about to start living together and get married soon after

Post by vtjon02 »

kadye wrote: Thu Sep 03, 2020 3:43 pm We are about to start living together and get married soon after. What personal finance advise do you have for us? Here are some of the things we already discussed.
  • Prenup for pre-marital assets and combine everything we make after marriage
  • Agree on a long-term financial goal and stick to it
  • Have small amount of money for personal spending where we don't have to get permission from each other to buy stuff we want.
  • Discuss and agree on major purchases before we buy.
What else? Many thanks!
This is a good list. I think a prenup is vitally important when one or both people have pre-marital assets or debts. Just also pay attention to the pre-marital debts. Run credit reports for both and have some documentation of what debt each party brings and who will pay it off.
Jags4186
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Re: A personal finance checklist for a couple who are about to start living together and get married soon after

Post by Jags4186 »

I mean everyone is going to have an opinion on a pre-nup. I don't think you need one except for a few circumstances:

1) Vastly different net-worths going into the marriage (say you have $5mm net worth and the potential spouse has -$100,000)
2) Second marriages where assets of one spouse are to be directed to children from a previous marriage
3) You own a business which may have partners that you need to protect

Until you're married you're two separate people. You shouldn't have commingled finances.

Once you're married, there are plenty of ways to do it, but my wife and I have a joint checking account that all of our income goes into. We don't ask each other for permission to spend money as we both are pretty respectful and discuss large purchases. To us, it seems over $200 is a large purchase worth "checking in" with the other person.
delamer
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Re: A personal finance checklist for a couple who are about to start living together and get married soon after

Post by delamer »

It sounds trite, but almost any system you come up with will work as long as you have frequent and full communication.

For thr couples I know who’ve had serious financial issues, lying about/concealing spending was the problem.

That said, your plan sounds good.
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arcticpineapplecorp.
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Re: A personal finance checklist for a couple who are about to start living together and get married soon after

Post by arcticpineapplecorp. »

this is for before marriage (after marriage everything is joint):

1. you could do three accounts: hers, his (assuming these are the correct genders of question in couple) and ours.

The his and hers would be your own obviously, but the ours would be for joint spending (rent, utilities, food, etc).

So you figure out what your joint spending is each month and each contributes half of that to cover all joint bills. Antyhing that's not joint (student loans, car payment, etc. is the responsibility of the person who took on that loan).

2. Another way I've seen mentioned by financial "experts" is if there's a significant difference in income between partners:

As an example, say you make $100,000 and she makes $50,000. Say your rent is $2000 a month ($24,000 a year). If each of you pay $12,000 a year ($1000 a month) that's only 12% of your income but it's 24% of her income. You could decide it might be more fair for you to pay $1333 and her to pay $667 (close enough) to have you paying twice what she is because you have twice the income as she does. Then you'd each be paying 13% of your income on rent, not 24% for one and 12% for the other.

I've seen different things like this. Let's say she has student loans and you don't. You could decide to pay more of the joint bills (rent, utilities) if she commits to paying down/off her school loans with money she'd otherwise have to pay for rent/utilities).

If you're trying to accomplish joint goals, you'd want to figure out how to help each other with that. 50/50 doesn't always accomplish that if there are inequities in income, debt, etc.

but definitely talk about money. it's the major source of conflict in relationships. if you're not on the same page now (one is a spender and one's a saver) it's not going to get any easier after marriage. take if from someone who knows.
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kadye
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Re: A personal finance checklist for a couple who are about to start living together and get married soon after

Post by kadye »

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burritoLover
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Re: A personal finance checklist for a couple who are about to start living together and get married soon after

Post by burritoLover »

kadye wrote: Thu Sep 03, 2020 6:53 pm
burritoLover wrote: Thu Sep 03, 2020 4:36 pm Nothing says life long love like a prenup
I assume you are being sarcastic. If so, can you elaborate why you are against this?
It’s like you have one foot out the door already. But, if both sides are equally in agreement, maybe its fine, but that probably doesn’t happen often.
"Your money is like a bar of soap. The more you handle it, the less you’ll have." - Gene Fama
stan1
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Re: A personal finance checklist for a couple who are about to start living together and get married soon after

Post by stan1 »

For us over 22 years it has worked to have 3 checking accounts: a joint account, his account, and her account.

Some people feel separate accounts are too complicated or invite the temptations of satan. We obviously don't believe either to be true.
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kadye
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Re: A personal finance checklist for a couple who are about to start living together and get married soon after

Post by kadye »

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sailaway
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Re: A personal finance checklist for a couple who are about to start living together and get married soon after

Post by sailaway »

For the actual arrangements, whatever, talk about it. It seems you already have some, keep it up. Do what works for the two of you and be willing to discuss new ideas, especially if they streamline the process.

Topics:

-beneficiary designations for individual accounts

-life insurance and life insurance beneficiaries - do either of you have a workplace policy?

-what counts in your AA (ie, do you have a joint account AA and two personal AAs for retirement accounts or one overarching AA)

-credit cards: personal, joint, authorized users, making the most (or the simplest) of rewards.

-car insurance and useage: my guy was young when we got together, even as domestic partners our joint insurance was less than he could find on his own. He had an SUV and I had a hybrid, so we used my car for joint trips, unless I begged for the heated seats in the winter. OTOH, my parents have been together for over 50 years and still negotiate which car to take with each trip.

-who actually pays the bills? For us, the answer to this has changed almost every time we move. I am now in charge of everything except his medical bills. Since he uses the on campus clinic those go to his work email. Often, bill pay won't let you share billing information even on a joint account.
MedSaver
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Re: A personal finance checklist for a couple who are about to start living together and get married soon after

Post by MedSaver »

kadye wrote: Thu Sep 03, 2020 3:43 pm
  • Prenup for pre-marital assets and combine everything we make after marriage
I'm not gonna take this bait. Presumably you both agree that a prenup is best. If you haven't sprung this on your fiancé/e yet, let us know how that discussion goes.
kadye wrote: Thu Sep 03, 2020 3:43 pm
  • Agree on a long-term financial goal and stick to it
You only have one? Generally speaking, the devil is in the details. E.g. Sure you can agree that you want to FIRE and be multimillionaires in 10 years, but maybe one of you wants to get there through day trading penny stocks and the other wants to invest in CDs and live like a pauper. Maybe one of you wants to have equity in a McMansion and the other wants to be a landlord and live in an apartment. You guys need to agree on the process as well as the goal.
kadye wrote: Thu Sep 03, 2020 3:43 pm
  • Have small amount of money for personal spending where we don't have to get permission from each other to buy stuff we want.
  • Discuss and agree on major purchases before we buy.
I'll take these together. You have to agree on what exactly does "small amount" and "major purchase" mean to each of you? This will probably depend both on your history/upbringing as well as your current circumstances. I know some couples that don't bat an eye spending anything less than $10,000 and certainly don't feel they need to tell their spouse about such "petty" amounts and I know others where $100 could mean someone sleeps on the couch that night.
Luckywon
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Re: A personal finance checklist for a couple who are about to start living together and get married soon after

Post by Luckywon »

kadye wrote: Thu Sep 03, 2020 3:43 pm We are about to start living together and get married soon after. What personal finance advise do you have for us? Here are some of the things we already discussed.
  • Prenup for pre-marital assets and combine everything we make after marriage
  • Agree on a long-term financial goal and stick to it
  • Have small amount of money for personal spending where we don't have to get permission from each other to buy stuff we want.
  • Discuss and agree on major purchases before we buy.
What else? Many thanks!
Best wishes on your upcoming marriage and life together. My spouse and I have a prenup and live in California and I see in a previous post of yours that you may potentially move to California. Couple of points: In California, as a community property state, assets that are community property get a full step up in basis upon the death of one spouse. (This is as opposed to common law property states where step up applies only to the deceased spouse's share.) So, upon the death of a spouse, a surviving spouse does not get a step up in their own individual property, whereas if that property was held as community property, it would. There are therefore scenarios where there may be a penalty in terms of lost step up when you hold property individually in a community property state. This is something to potentially keep in mind, as it could be averted by re-titling individual assets as community assets at any time during the marriage if circumstances warranted (such as illness).

To be clear, a surviving spouse receives a step up in basis of inherited assets from the deceased spouse in both community and common law property states. I am talking about a step up in basis of assets of the surviving spouse.

Another thing to keep in mind, if you hold property individually, it's quite likely you may want three living trusts: one for each spouse's individual property and one for marital property.

And try to just ignore the snide comments on your decision to get a pre-nup. Always amazing to me how ready some are to opine on the morality or wisdom of two consenting adults availing themselves of this legal option.
Last edited by Luckywon on Thu Sep 03, 2020 8:00 pm, edited 1 time in total.
sailaway
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Re: A personal finance checklist for a couple who are about to start living together and get married soon after

Post by sailaway »

kadye wrote: Thu Sep 03, 2020 3:43 pm
  • Agree on a long-term financial goal and stick to it
I missed this somehow. This has not been the case for us at all. We agree to the ground rules, but the actual financial goals shift with time and new opportunities.

Ironically, one of the most recent changes was to start spending more on travel, so we have failed pretty spectacularly at that.
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Re: A personal finance checklist for a couple who are about to start living together and get married soon after

Post by nguy44 »

MedSaver wrote: Thu Sep 03, 2020 7:38 pm
kadye wrote: Thu Sep 03, 2020 3:43 pm
  • Agree on a long-term financial goal and stick to it
You only have one? Generally speaking, the devil is in the details.
This is key. You cannot stick to generalities. You have to start defining details. And assess how much each of you are willing to stay in sync on those details.

For example:
- How much debt are each of you bringing into the marriage? Like your asset accounts, will this debt be shared? what will be the plans to pay it down/off before/during marriage?
- What are you attitudes towards spending, and are they in sync?? For example, "lets save until we can pay for it" or "lets use credit cards and pay it off over time"?
- If you plan to have kids, how will you manage your income? Will one of you choose to stay at home? Can you live off of one income if this happens? Should you start living off of one income before that happens?
- What will you budget be? How much do you plan to save/invest each month? Can you stick to it - e.g. if you have $10 left in your food budget with a week left in the month, can you manage to stick to it? Can you LBYM (Live Below Your Means) to achieve long term goals?
- Are you in sync on the use of credit? How many credit cards do you each have now, and their balances? Does your plan include paying them off every month?
- How will you prepare for the "unexpected" - e.g. job loss, major repair, surprise addition to the family (much of this drives what you feel should be your emergency reserves)?
- What are you attitudes towards housing? For example, are you the "I can be happy in any home we choose to own", or "I expect to upgrade homes are our lives move forward"?
- How honest have you been with finances with each other so far?

The statistics I have seen say that the number one factor contributing to marriages breaking up are financial related issues. That is why it is important to discuss these details - ESPECIALLY to determine if you are very out of sync on something now that might impact the marriage down the road.
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Re: A personal finance checklist for a couple who are about to start living together and get married soon after

Post by Grt2bOutdoors »

Personal finance advice: Communication! If you are unable to communicate, you will run into problems. You can apply that to all parts of your relationship-no communication is death knell. Talk about your goals, how you plan on getting there, spending - what is reasonable what needs to be discussed before spending it. No need to talk about small purchases or groceries/sundries/personal hygiene services. One checking account. One savings account. One investment account holding all your investments. All are jointly held. Individual assets pre marriage remain separate from each other.
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celia
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Re: A personal finance checklist for a couple who are about to start living together and get married soon after

Post by celia »

Full disclosure from both parties on:

* Assets and Debts, including how the assets are invested (mutual funds, employer plans, bitcoin, bank CDs, trust beneficiary, real estate, etc)
* Past lawsuits
* Children from previous relationships (I know a guy who packed up and flew cross country prepared to propose until he found out she had a child she forgot to mention)
* Past tax returns
* Pay stubs and employee benefits
* Credit reports and credit card usage
* Past education and desire for more (another degree??)
* Work history
* What insurance(s) do you each carry (ie, being prepared)
* Future goals (type/size of wedding and costs and how you would pay, number of kids to have or not, stay at home parenting?, travel, hobbies)
* Are there any relatives likely to be unable to support themselves in the future and would you feel obligated to help
* What would you change, if anything, after marriage if one of you was laid off, both of you laid off at the same time--for a year
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Re: A personal finance checklist for a couple who are about to start living together and get married soon after

Post by LadyGeek »

I removed a few off-topic posts and a reply. As a reminder, see: General Etiquette
At all times we must conduct ourselves in a respectful manner to other posters.
Please stay on-topic, which are the personal finance aspects.
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Re: A personal finance checklist for a couple who are about to start living together and get married soon after

Post by galawdawg »

burritoLover wrote: Thu Sep 03, 2020 6:58 pm
kadye wrote: Thu Sep 03, 2020 6:53 pm
burritoLover wrote: Thu Sep 03, 2020 4:36 pm Nothing says life long love like a prenup
I assume you are being sarcastic. If so, can you elaborate why you are against this?
It’s like you have one foot out the door already. But, if both sides are equally in agreement, maybe its fine, but that probably doesn’t happen often.
Well OP did post a general financial question at tne end of last year about saving in a Roth where he mentioned both he and his wife, their careers, ages, debts and their assets and such: viewtopic.php?f=2&t=295463&p=4847118#p4847118

So assuming that in the intervening nine months there has arisen marital discord, separation, filing for divorce, divorce proceedings, granting of a divorce, a new girlfriend, a new home purchase with said girlfriend in July (viewtopic.php?f=2&t=320108&p=5368808#p5368808) and now an engagement and upcoming marriage, consideration of a prenup is likely very appropriate in this situation.
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Re: A personal finance checklist for a couple who are about to start living together and get married soon after

Post by kiwi123 »

galawdawg wrote: Thu Sep 03, 2020 9:06 pm
burritoLover wrote: Thu Sep 03, 2020 6:58 pm
kadye wrote: Thu Sep 03, 2020 6:53 pm
burritoLover wrote: Thu Sep 03, 2020 4:36 pm Nothing says life long love like a prenup
I assume you are being sarcastic. If so, can you elaborate why you are against this?
It’s like you have one foot out the door already. But, if both sides are equally in agreement, maybe its fine, but that probably doesn’t happen often.
Well OP did post a general financial question at tne end of last year about saving in a Roth where he mentioned both he and his wife, their careers, ages, debts and their assets and such: viewtopic.php?f=2&t=295463&p=4847118#p4847118

So assuming that in the intervening nine months there has arisen marital discord, separation, filing for divorce, divorce proceedings, granting of a divorce, a new girlfriend, a new home purchase with said girlfriend in July (viewtopic.php?f=2&t=320108&p=5368808#p5368808) and now an engagement and upcoming marriage, consideration of a prenup is likely very appropriate in this situation.
They have deleted all their posts now :-( I was trying to catch up on all the background. Sounds like a lot happening in a short period of time!
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Re: A personal finance checklist for a couple who are about to start living together and get married soon after

Post by LadyGeek »

The OP has deleted all his posts in every thread.

This thread is locked to end the discussion.

(I also locked other threads started by the OP.)
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