Planning Your Financial Future
Even the honeymoon has to end sometime, and you’ll have to think about your new future together. So take care of the technical stuff as early as possible (before you get married is best) and it won’t be pressing on your thoughts.
Your "new life" insurance.
Life Insurance, the “biggie” when it comes to planning ahead, isn’t always necessary, but you should look into it. If you and your spouse each make a good income, and you don’t plan on having children, you might skip it. However, if that’s not the case, check it out as soon as possible. (The younger you are, and the better your health is, the cheaper and easier it is to get insurance—by the way, if you haven’t already, quite smoking!) One rule many couples go by is their mortgage: If both of your incomes are required to make the payments, life insurance is probably a good idea. Whatever plan interests you, make sure the “death benefit” is large enough to cover funeral expenses, medical expenses, and other long-term payments, like your children’s education.
Money matters.
The two types of life insurance, “term policies,” and “permanent policies,” are fairly straightforward. The first gives the survivor a certain amount of money for a determined amount of time, the second gives you payments for the remainder of your life—you can also borrow against it or cash out if needed. The second is, obviously, more expensive, around $50 a month as opposed to about $20; talk to your lawyer and/or financial advisor, and comparison shop. Most employers offer some kind of life insurance, so do the math and figure out if it’s enough, or if you’ll need to invest in an additional policy.
Future stock.
As for 401k’s, IRAs, and credit cards, start talking now. Before you get hitched, you need to know the other’s financial situation. Remember, “in sickness and in health” includes “in debt and in wealth.” There’s a good chance you both put money into a 401k; if you can afford it, put in more. Any bad credit issues are vital to get out in the open, because his debt is about to become yours. Many newlyweds suddenly find they can’t get a loan because their spouse has bad credit. Some couples opt to have a joint banking account, and joint credit cards, in addition to keeping their individual credit and bank accounts. That doesn’t mean you don’t trust your spouse. It’s simply a matter of common sense, depending on your individual financial situations.
Remember, before you pack for the trip of a lifetime, talk about all your money issues. The last thing you want is an elephant in your honeymoon suite.