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Marriage Finances: Combining Finances After a Wedding

With this debt, I thee wed. Marriage finances don't have to be that scary with these tips.

Justin Cupler

Contributing Writer at Tally

October 27, 2021

Getting married is one of the biggest steps you'll take in your life. You're not only committing to this person emotionally, though. You're also committing financially, as getting married includes marriage finances. This means your finances are suddenly your spouse's finances, and vice-versa. 

Though it may sound intimidating, sharing something as private as personal finances with someone is a normal and necessary part of a successful marriage. If you choose to combine finances after marriage with the right processes in place, it can be simple, straightforward and rewarding. 

Creating and sustaining your marriage finances

After marriage, it may be time to start creating joint finances, including:

  • Financial goals 

  • Assets

  • Debt 

  • Incomes 

  • Money issues 

  • Retirement plans 

  • And more 

We'll cover the key points to creating solid marriage finances for a strong future.

Compare and combine financial goals

Marriage finances: couple looking at their finances

Each spouse should list their key long- and short-term financial goals. The couple will then compare notes and see how goals stack up next to one another. Where there are common goals, such as paying off debt or building an emergency fund, note those separately as "Family Financial Goals." 

Compare the non-matching goals and prioritize them as a family. Remember, while that may not have been your goal when you were single, you married into this goal and should see it through. 

Arrange each other's goals in a financially logical order, such as: 

  1. Pay off high-interest debt

  2. Build a three- to six-month emergency fund

  3. Save for a large purchase, such as a home or car

  4. Save at least 15% of your income for retirement

  5. Save for other purchases and goals

Transfer these new goals to your "Family Financial Goals" list and prioritize them in a way that makes sense for your finances.

At this point, it may also be worthwhile to visit with a financial advisor who can look at your marriage finances and financial goals and help you with your financial planning. 

Create a family budget

Setting a new household budget is an important part of your marriage finances. It’s possible financial situations weren’t fully disclosed during the dating and engagement processes. Now, it's time to peel back the layers and look deep into each other's finances to create a family budget. 

This’ll involve disclosing all parties' incomes, debts and other expenses. You'll also want to look at each other's spending habits and address any potential issues.

For example, if your significant other is an impulse buyer who's known to drop a few hundred dollars on clothing at random, consider addressing this. If the issue is significant, a financial therapist may be a worthwhile investment. 

Choose a budgeting method that best suits both parties. That could be the 50/30/20 budget, an envelope budget, a zero-based budget or any other countless budgets available. 

You'll also want to discuss who will handle managing the budget and whether or not you wish to invest in a budgeting app or software. If you feel strongly one way or the other about who should manage the budget, make this known. For example, if you know you'll struggle to manage the budget, let your partner know. 

It's best to be clear and honest now than risk damage with poor financial decisions and money management down the road. 

Take inventory

The jumping-off point for combining finances for married couples or life partners is inventorying each person's finances. This isn't just looking at your bank account and determining how much cash you each have. 

Some examples of finances to take inventory of include:

  • Checking accounts

  • Savings accounts

  • Investment accounts

  • Retirement accounts

  • Credit cards 

  • Personal loans

  • Student loans

  • Auto loans

  • Mortgages

  • Home equity loans and lines of credit

Each spouse should pull statements from all these accounts, if possible, to share with the other spouse. This openness and honesty will go a long way in developing trusting and successful marriage finances.

Each spouse will also want to pull their credit report and credit score. This may seem invasive, but it's good to know where the other stands in terms of credit as a couple adjusting to marriage finances.

Combine net worth

Marriage finances: happy couple looking at something from their laptop

With a firm inventory of all your financial happenings, including your debt and assets, you can start combining all your marriage finances on paper to determine the overall net worth of your new family. Using a spreadsheet or pen and paper, start adding together the assets and debts by category.

For example, add all checking account balances, all credit card debt, all investment accounts and so on.

Keep in mind that people’s finances are rarely perfect. One spouse may bring more debt than assets relative to the other. This is all about sharing that responsibility equally. Avoid finger-pointing and judging based on each other's finances. 

Now, combine all your assets and add them up, then do the same for all your debts. Subtract the total debts from the total assets, and the resulting sum is your family net worth. 

Combine liquid assets

A critical step in personal finance for newlyweds who want to create joint accounts is to physically combine your liquid assets, which is essentially your cash on hand and in various bank accounts. 

The first part is determining which accounts to keep and which to close. Look at the benefits of each partner's bank accounts to determine which is best. Things to consider are interest rates on savings and checking accounts, ATM availability and branch availability. 

You can also choose to close both partners' accounts and open brand-new joint accounts. Use the same criteria listed above to determine which bank may be best to open new joint accounts. 

Suppose you're not comfortable with fully combining all your cash into one joint bank account. In that case, you can have one joint account for all your shared expenses, such as utilities, mortgage or rent payment, groceries, investments and more. Then, each spouse can have a separate account to keep their leftover spending money or cash for other personal use. 

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Change beneficiaries

When you have retirement accounts and investment accounts, it's wise to assign your spouse or life partner as the beneficiary. This is the person who'll receive control of the account and its assets in the event of your passing. Without beneficiaries assigned to an account, a messy legal battle could ensue. 

Log in to all your accounts and check for an area where you can change the beneficiary online. If there's no option to do so online, you may need to call the institution to change the beneficiary to your spouse or life partner. 

Some accounts that may have beneficiaries include:

  • Life insurance policies

  • 401(k) accounts

  • Individual retirement accounts (IRAs)

  • Checking and savings accounts

  • Money market accounts

  • Certificates of deposits (CDs)

  • Brokerage accounts

  • Pensions

Plan for retirement

When you're single, retirement planning is all about you. However, as a couple with shared marriage finances, retirement becomes a team effort. It could be a difficult situation if one spouse's retirement planning led them to retire at 55 years old, whereas the other spouse couldn’t retire for another decade. 

Discuss your retirement plans with your spouse to see when they plan to retire, how they plan to achieve this and their plans in retirement. This is another time when a financial planner may also help. They can look at your finances and determine how each spouse can adjust their retirement plans to better align with one another. 

Revisit your marriage finances frequently

Remember, personal finance isn't a set-it-and-forget-it item. You should revisit it frequently to remain on track. As a couple just getting into marriage finances, this is even more crucial. 

Revisit your marriage finances at least once per month, advises Sallie Krawcheck, CEO and co-founder of Elevest.com. Krawcheck suggests revisiting your marriage finances all the time, noting 78% of couples who talk about money every week report being "very happy." 

Marriage finances: One step toward a lifetime of happiness

Happy family of four having fun outdoors

Marriage is a long and complex road of love, compassion and compromise. Don't let marriage finances get in the way by developing a firm plan at the beginning and sticking with it. With the above tips, you'll be well on your way to creating secure marriage finances that will help you keep your relationship strong and vibrant. 

You can learn more about key aspects of marriage finances by signing up for the Tally† newsletter. We offer personal finance tips on budgeting, tackling debt, financial goals and more. 

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