Just tied the knot? Or getting ready for the big day? First off, congratulations are in order! Secondly, it is probably time to start thinking about the financial steps you and your partner need to take to make sure you’re legally and financially starting off on the right foot.
Financial wellness can oftentimes be difficult to achieve on your own, so adding another individual into the mix can tend to complicate things a bit. This is why it’s so important to communicate with your partner, be proactive, and take the steps necessary to seamlessly transition into your new life together.
Below we will list some newlywed legal and financial considerations to think about when taking those next steps with your significant other.
- Changing Your Name
In today’s world, you may not be interested in changing your last-name and accepting your partner’s name. But whatever you decide, you’ll need to make your new name legal as one of the first tasks of married life. If you’re changing your name, you won’t be able to set up a new joint bank account, get a passport, or put your name on a joint house title without updating certain legal documents. Once your name change is official, there are institutions and documents you will need to notify or update, which include employers, including benefit, payroll, and W-2 documents, Banks/Financial Institutions, Insurance Companies, Utility Bills, Doctor/Dentist Offices, Professional Licensure, Professional Associations, Educational Institutions, Estate Planning Documents, Social Media Accounts and more.
2. Merging your Money
Once you’ve taken care of any necessary name changes, it’s time to make some decisions about how your new household will merge and manage your personal finances. There are many ways to handle this, including keeping separate finances, combining finances, and developing a system that involves both. It is important to communicate to understand who will be taking care of certain bills and expenses, and where the funding will come from.
3. Merging Insurance Plans
When discussing merging finances, don’t forget about combining insurances. Now that you are married, it could be cheaper to sign up for one partner’s health insurance plan and add the other as a spouse.
4. Setting up Beneficiaries
Now that you are married, there is a good chance you will want to update the beneficiaries on any 401(k), IRA, and or taxable investment accounts you have. If you have a life insurance policy, be sure to change the beneficiaries there as well.
5. Property Titles
Did you move into your spouse’s home or are yours after marriage? If either of you is moving, you may consider changing the house’s title to represent joint ownership, especially if one partner is helping pay the mortgage. You may also decide to put both of your names on your vehicles for similar reasons. Make sure you’re setting up ownership of your joint assets to reflect the combined payment.
One of the best gifts you can give your new marriage is the gift of financial transparency. While you may not be a fan of budgets, or may not have tried one before, consider budgeting as a way to start a solid financial future with your partner. It’s important to communicate and understand the financial means of your new situation with your partner.
While these are only a few of the topics you should incorporate into your financial conversations, the best place to start is establishing strong line communication. Communication is key in understanding each other’s views and building a strong foundation together. We recently recorded a podcast with psychotherapist and consultant, David Pearl, discussing how to have uncomfortable and oftentimes difficult money conversations with your spouse. For any questions or direction on your newlywed financial situation, reach out to us at email@example.com or schedule a complimentary 30-minute meeting here.