For many newlywed couples, combining finances can cause a lot of friction.
When I’m teaching couples about merging their money, I like to say that if I were the treasurer for our family, we’d all be buck naked.
I use that joke to illustrate that, in selecting who will be the one to handle the day-to-day bill-paying, it may not be what seems the logical choice.
My husband’s an engineer by training. I write about money all the time. Yet, he’s our treasurer because spending any money — even for necessities — makes me anxious.
During a recent online discussion, a bride-to-be had a laundry list of questions about her money and her man.
Here’s a bit of the background: They have similar financial temperaments in terms of how they spend and save. (That’s half the battle!)
“But we haven’t actually sat down to figure out the details of how to blend our finances,” the reader wrote. “And for the record, I love to talk about money, while my future husband is a little more reluctant because we’re not struggling and we’re meeting our goals at this point, and talking about what-ifs triggers some general stress/anxiety for him.”
Here are her questions and my answers:
What advice do you have to help us merge our financial lives?
When blending your assets and liabilities, you’ve got to have a system.
Pick a treasurer. I’ve found that in marriage, spouses end up taking on regular roles. If you’re the one who does the money thing better because you’re calmer, you should be the treasurer.
If both spouses are trifling when it comes to finances, choose the less trifling person. Somebody’s got to do it.
Set up regular budget sessions. At the start of your marriage, meet once a week to talk about the bills so that you are accountable to each other. Meet once a month to talk about the big-picture stuff — retirement, saving for a home, etc.
Create some “House Rules” for your finances. Here are some that I recommend: Choose a spending limit that neither of you can exceed without the consent of the other. For example, you couldn’t spend more than $100 without first discussing the purchase. Agree that you’ll have complete transparency about all debts, income, savings and spending.
Do you have any suggestions about how to have money talks without triggering his anxiety?
Get some outside help. Check your community or church for any financial classes that you can take together. Often, during such courses, you’ll explore your financial backstory, which helps pinpoint trigger points for anxiety about money. Once your spouse is aware of why he or she gets stressed about certain financial issues, you both can figure out how to deal with the reason.
How do we make choices that potentially have big financial impacts, like whether to keep our own individual health insurance plans?
These are the questions you’ll tackle during your big-picture meetings. As for health benefits, you probably don’t need two plans. In fact, getting married gives you a chance to revisit your health-care choices and make changes. Compare the coverage, co-pays, health providers you may want to keep and, of course, the cost. Try one plan for a year. And if it doesn’t meet your needs, you can switch during the next open enrollment.
What are the implications of filing our taxes jointly versus separately?
Hire a tax professional and have him or her run both scenarios. Be sure to ask what tax deductions and credits you may be forgoing if you don’t file jointly.
What type of a financial professional should we seek out?
It might do you well to hire a financial adviser, who can create an overall plan for you that takes into account retirement, your insurance needs, taxes and short-term and long-term saving and investing goals.
Here are two organizations to begin your search: the National Association of Personal Financial Advisors (napfa.org), which can help you find fee-only planners, and the Certified Financial Planner Board of Standards (letsmakeaplan.org), which will direct you to a trained certified financial planner, or CFP.
This month, the CFP Board along with three other nonprofit groups — the Financial Planning Association, the Foundation for Financial Planning and the U.S. Conference of Mayors — are sponsoring free “Financial Planning Days” events, which include one-on-one counseling and personal-finance workshops. Go to financialplanningdays.org to see whether there is an event near you. Or call toll-free at 877-861-7826.
If you want financial harmony in your household, be sure to communicate, be willing to compromise, and set common goals.
Readers can write to Michelle Singletary c/o The Washington Post, 1301 K St. NW, Washington, D.C. 20071. Or firstname.lastname@example.org. Comments may be used in a future column, with the writer’s name, unless a specific request to do otherwise is indicated.