Say "I Do" to a Financially Strong Marriage

“I hope I never have to deal with debt again like we were trying to deal with, especially at that time in our lives. Just knowing that there is a place that treats you well when you need it the most makes life a lot easier. Being completely out of debt is so exhilarating and makes for a happier and stronger marriage.” – V.B.

Engaged couples dream of married bliss, but finances often can be the No. 1 problem in marriage and a leading reason for divorce. How you handle money at the beginning of your marriage can have an enormous impact on the rest of your lives together. According to a survey by the Association of Bridal Consultants, more than 67% of newlyweds believe the most serious conflict in their first year of marriage is over money. (Problems with in-laws rank a distant second.) The American Bar Association has indicated that 89 percent of all divorces can be traced to quarrels and accusations over money. AAA Fair Credit Foundation believes being on the same page about all of your financial data is a long-lasting way to show each other your commitment.

Have "the talk."
If you haven't done so yet, tell each other where your key financial information (checking, savings and investment accounts, mortgages, and insurance policies), as well as valuables (birth and marriage certificates, jewelry, safe deposit key) are located. It's important to understand each other's financial dreams and plans, as well as final wishes, so that you know exactly what to do in an unforeseen situation.

Recognize Your Individual Philosophies.
Even if two partners have a similar money philosophy, one will usually end up as more of a saver and the other more of a spender. The following are common polarizations that couples may adopt in their attitudes about money:

• Saver vs. Spender (Do you prefer to put extra money in the bank or in the cash register?)
• Ostrich vs. Agonizer (Do you pretend nothing is wrong or do you lose sleep over money problems?)
• Gambler vs. Security Gaurd (Do you prefer high-risk investments or do you put your money in government bonds?)
• Plotter vs. Romantic (Do you plan your financial moves in detail r just dream about that house you have always wanted?)
• Joint Account vs. Seperate (Do you have the philosophy that "what's mine is yours" or "what's mine is mine"?)

Don't Break the Bank on Your Wedding.
Plan the wedding of your dreams based on your financial means. Read the book "Cheap Ways To Tie the Knot" by Cara Davis. Click Here to download the Wedding Planner Budget

What's Mine Is Mine, What's Yours Is Mine.
The first challenge to newlyweds is inevitably, how do we manage the checking accounts? Some couples opt to lump everything together right away, others decide to keep three separate checking accounts at first: his, hers and ours. While that may seem simpler at first, after a few years of marriage, couples usually find it easier to have a single account. If you do decide to combine your checking accounts, it's essential for each person to have his or her own spending money — and not have to tell the spouse where it goes. You need to give each other a little space.

Create a Comprehensive Budget.
Once you've got a system worked out, you'll be able to monitor your spending. Review our bank statement monthly and find out where the money is going. Continue to develop a reasonable spending plan (commonly referred to as a budget). At the very least, try to spot the problem areas and concentrate on reducing spending. So if you find that you're dropping too much cash on restaurant meals and takeout because you're both too tired to cook after work, budget a certain amount of money. When you've hit that limit, you can't spend anymore until the first of the month. Click Here for assistance on how to create a spending plan.

Meet the Marriage Penalty.
Although Congress is currently debating the future of the marriage penalty, it's intact for now. Which means that a married couple filing jointly pays more in taxes than two single people with the exact same incomes. For example, a married couple, with each spouse making $40,000, can expect to pay an extra $1,500 in federal taxes. So, prepare to pay more come April 15. But, don't run to your human-resources office to change your W-4. At least not if you and your spouse are both working. Once you indicate that you're married, the rules assume that one spouse doesn't work. As a result, your withholding will actually decline. And that's just the opposite of what you want.

Pay Down Debt.
There’s nothing romantic about starting a marriage with unneeded debt. It's a common scenario: One person comes into a marriage with accumulated personal savings and the other enters the relationship with personal debt. Even though the thrifty spouse is not liable for debt incurred before the marriage, the free spender's history is sure to affect a couple's chances of obtaining credit in the future. And if you're in the market for a new home, you'll probably be applying jointly. That should be motivation for you to pay down the debt together. If you are behind on your bills and need help, call 1-800-351-4195 to speak with a Financial Counselor.

Calculate Your Net Worth.
Before you can make any decisions about budgeting, investing or saving for a house, you have to know how much you own and how much you owe. Work together to create a combined balance sheet, (a list of assets and debts), and then update it regularly. You should also check your overall portfolio and rebalance if necessary. You may discover that together, you're over weighted in one particular stock or sector. You’ll also want to look ahead to retirement and figure out a way to maximize contributions to your 401(k)s and IRAs and invest as aggressively as you should given your age and goals.

Protect Your Incomes.
You don't really need life insurance if you're both working and don't have children. But you will certainly receive the pitch from an ambitious salesperson. If you think you need it, ask an independent financial planner first. What you do need, however, is disability insurance, especially if you're relying on both of your incomes. You might get insurance through your benefits plan at work that will cover 60% to 70% of your income, but it's probably a good idea to supplement that. It can be expensive, but it's worth your attention

Protect Your Future Together.
You thought planning the wedding took a lot of organizational skills? Wait until you try to track down everything that has your name on it — or that you named a beneficiary for — a mortgage, 401(k)s, IRAs, disability insurance and life insurance at work. If you have a will already, you'll want to change it, if not you need to have one drawn up. These decisions are especially important for second marriages in which there are children involved.

Review Your Credit Reports.
Reviewing your credit reports together is essential to understanding your credit standing. Buying things on credit such as cars, homes, and other major purchases all require a good credit history. Reviewing your credit report together allos you to correct any errors reported which could potentially result in higher interest rates and less money in your pocket. For assistance on how to navigate your credit report call 800-351-4195 and speak with a Financial Counselor.

Talk Regularly about Money Matters.
Above all, it's important to communicate regularly and openly about money. If that means setting aside a time each week or each month for a state-of-the-finances chat, then do it. Consider rewarding yourself with a dinner out or a movie after each financial-planning session. It's absolutely critical to keep each other informed, especially if one person tends to deal with all the money maintenance, while the other handles different tasks. Discuss long-tern goals and necessary short-term sacrifices.

Insure Your Wedding.
Given that the average cost of a wedding in America has reached $27,000, it's no surprise that less than 1% of couples make room in the budget for wedding insurance. But if you and your beloved are sinking a fortune into your upcoming nuptials it may be worth considering taking out a policy. Wedding insurance now covers a broad range of contingencies and can help you recoup your money should things go awry on or before your special day. You can buy policies that cover nonrefundable deposits if you have to cancel your wedding due a death in the family or a natural disaster like a flood, fire or hurricane; others reimburse you if your spouse is in the military and is unexpectedly deployed; and still others cover the expense of restaging wedding photos or replacing a lost or damaged wedding dress. There's even a policy that covers cold feet, so parents no longer have to pay the price for a child's last minute change of heart.

Rest in peace.
This is always a tough topic, but discussing your final wishes and arrangements will ensure neither of you will be burdened with those decisions later on. Write down and tell your spouse, as well as other family members, where you want to be buried, funeral arrangements and even whether or not you wish to be an organ donor.

Click here and find out how AAA Fair Credit Foundation can help you learn new habits and attitudes about money that will influence you and your family for the rest of your lives. For more information call 1-800-351-4195 to speak with a Financial Counselor.