Since disagreements about money often lead to marital problems, be sure to discuss finances with your fiancée before saying "I do".
If you want a neutral third-party to help you cover the important financial questions, look for a "fee-only" financial advisor that bills by the hour. (Click here to find one.) This will make sure you get the advice you want without sales pressure.
Here are some of the questions you should consider:
Question 1: What are our assets and liabilities?
One of the first steps you should take is to create personal balance sheets that detail what each of you owns and owes. These purpose of these balance sheets is to see where each of you stands financially and see how your combined financial situation would look.
Question 2: How will we handle existing debt?
You need to determine how you’ll handle any existing debt, especially unsecured debt like credit cards. Will you pay it off before marriage? Or after? If you bring it into the marriage, be sure to keep the other person’s name off of these obligations to avoid possible problems in the future.
Question 3: What do our credit reports look like?
Since our credit reports and scores affect everything we do, each of you should check your credit reports and scores to see where you stand. You can go to www.AnnualCreditReport.com to get your reports for free, but you will have to pay to see your FICO score.
(Note: If you see the word "free" in a website's URL, your credit report won't be free!)
Question 4: How will we handle daily spending decisions?
You don’t necessarily have to set a budget, but you do need to decide how you’ll handle daily spending decisions, especially if one or both of you tends to be a “spender” rather than a “saver”. Will you have a joint account? Separate accounts? And if you keep your accounts separate, who will be responsible for paying the bills?
Question 5: What are our financial goals?
Just as important as day-to-day financial decisions, you need to discuss your future financial goals like college expenses for children and retirement to make sure you are in agreement. It is best to put your financial goals in writing. If you don't like the idea of going through the financial planning process, at least consider jotting them down on paper.
To learn more about our company - and find out how we are different from other financial advisors - call (210) 587-6433 or visit www.VannoyAdvisoryGroup.com.
