Golden Wedding Rings for Engaged Couples Financial Planning

Pre-Wedding Planning: 8 Tips for Financial Bliss

For those preparing to wed, planning their future finances together may help strengthen their relationship. Marriage is not just a romantic commitment but also a financial partnership.

Here's a guide to help those preparing to ‘tie the knot’ work toward financial bliss before the marriage vows are exchanged.

Tip #1 – Engage in open conversations.

Transparency is key to an independent future. Both partners should share their income details, assets, liabilities, and financial obligations. Discuss short-term and long-term financial goals, which might include:

  • Saving for a vacation
  • Buying a home
  • Planning for a family
  • Preparing for retirement

Being open about these matters will help to align financial dreams and expectations.

Tip #2 - Prepare a joint budget.

Track income and expenses to help understand each partner's overall financial health. Consider lifestyle changes that could affect the monthly budget, such as moving to a new city or starting a family. The budget should reflect this and other factors, such as:

  • Fixed expenses: Rent or mortgage, utilities, insurance, etc.
  • Variable expenses: Groceries, entertainment, travel, etc.
  • Savings: Emergency fund, retirement savings, other goals

Joint budgeting not only helps manage household expenses but also helps both partners understand they are on the same page about financial habits and future goals.

Tip #3 – Draft a debt management plan.

Coming into a marriage with debt, be it student loans, credit card debt, or personal loans, is common. It's important to discuss how to tackle these debts openly. The couple may want to consider:

  • Prioritizing high-interest debts
  • Creating a repayment plan
  • Considering debt consolidation or refinancing options

A debt management plan can help reduce financial stress and build a strong financial foundation.

Tip #4 – Set up a household emergency fund.

An emergency fund is an essential part of any financial plan. It provides a safety net in case of unforeseen events such as job loss, unexpected medical bills, or major repairs. Aim to save enough to cover 3-6 months of living expenses.

Tip #5 – Plan and save for retirement.

Start planning for retirement early, since the sooner one starts investing, the more time one's money has to grow. Consider these retirement savings options:

  • Employer-sponsored retirement plans like 401(k)s, 403(b)s and other plans
  • Individual Retirement Accounts (IRAs and Roth IRAs)
  • Pensions and Social Security benefits
  • Annuities

Tip #6 – Evaluate insurance needs.

Insurance is an essential tool in protecting one's financial health. Evaluate insurance needs and consider several types of insurance:

  • Health insurance to cover medical expenses
  • Life insurance to provide for each partner in case of untimely death
  • Homeowner's or renter's insurance to protect property
  • Auto insurance for vehicles

The type and amount of insurance needed will vary based on circumstances as a couple.

Tip #7 – Schedule regular financial check-ins.

Lastly, regularly review and adjust the household financial plan to accommodate life changes and financial goals. Whether it's an annual check-in or a quarterly review, keep the lines of communication open.

Tip #8 – Work with a financial professional

It’s essential to work with a financial professional who can review each partner’s progress toward goals while accounting for each partner’s financial situation. Remember, preparing for marriage takes teamwork, commitment, and regular conversations about finances to align goals as you work toward an independent future together.

A financial advisor with a fiduciary duty provides this commentary and serves individuals and families across Arizona.

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