Finance Talks Every Engaged Couple Should Have
Your wedding is a spectacular, beautiful, love-filled event. Your favorite people gather to celebrate you and your betrothed, and even your most straight-laced friends usually end up on the dance floor.
Hundreds of hours and thousands of dollars culminate in this glorious day, and that kind of spending and prepping takes a lot of work. While it ends up being worthwhile, many young couples get a little distracted with the wedding day and don’t put quite enough thought into the years that will follow.
In the early days of a relationship, most of us focus on the similarities and shared interests that make a relationship so special. As time goes on, we start to notices ways in which we’re not the same as our spouses. These discrepancies don’t have to be problematic, but they should be addressed; you don’t want to wait until your third or fourth year of marriage to find out you disagree on some pretty big issues.
Before putting rings on fingers and exchanging vows, I urge you to talk about the important – and unavoidable – topics that life has waiting for you and your bride or groom. These matters don’t need to be settled before your wedding day, but future decisions will be much easier if you have these discussions in the early going.
1. Getting Out of Debt
Money can drive a real wedge between people, no matter how in love you are. However, it usually isn’t really money causing the problems, but rather a lack of money. Debt signifies the ultimate lack of funds, and newlyweds often have a lot of it. There are two parts to the debt discussion for people tying the knot. First and most importantly, couples have to lay everything on the table, leaving no financial obligation hidden. Relationships depend so much on honesty, and hiding something as simple as a car payment can lead to a massive breach of trust. You don’t have to talk about your debts on the first date, but it should all be out in the open before you book a wedding venue.
Disclosing credit card balances and outstanding loans is a very small step in this prenuptial preparation. After divulging all your dirtiest financial secrets, you need to formulate a plan for dealing with them. A small financial matter can cause a rift in your relationship, and a large amount of debt belonging to one-half of an eternally-bound couple can exacerbate that problem in a hurry.
As anyone with debt knows, paying down these balances takes more effort than just acknowledging it needs to happen. The process requires planning, action, and patience, and you can’t expect it to happen overnight. On top of existing debts, marriage and starting a family both have a lot of debt-creation potential, making this topic even more weighted leading up to marriage.
When you dive into your repayment planning, these points should factor into the discussion:
- Combined earnings
- Savings goals
- Wedding budget
- Five-year plan
Debt affects everything. It postpones hopes and dreams and makes paychecks feel smaller. If you don’t consider the things debt impacts and the goals obstructed by these negative balances, life will start running away before you and your spouse know what happened.
Looking at your total earnings helps with perspective, as it shows what can be done if you work together to eliminate credit card debt and loans. Some couples choose to keep finances separate, but if you’re truly committing to each other for the long haul, I think combining your funds should be part of that. The debt will be gone faster and it shows a necessary level of support.
Since saving and debt repayment ought to happen concurrently, you and your fiancé need to put some thought into where the rest of your money is going. Talk about retirement, car payments, saving up for a house, creating an emergency fund, etc. You’ll want to save for all these things, and you’ll want to start putting money aside as early as possible.
Your wedding should be one of those savings goals, as this expense has the potential to blow all of your plans to smithereens. The average American wedding costs around $25,000, and you don’t get to pay that in interest-free installments. Still, there’s something about a wedding that makes people ignore the obscene spending; couples walk into planning with an “I’ll sort out the money afterward” attitude, and that’s a dangerous way for two people to start their lives together.
For some, a year of debt for a day of fun is totally worth it.
If you started plotting your dream wedding when you were 13 and won’t settle for anything different, that’s your prerogative. Others might look at the total cost and decide $10,000 for catering isn’t worth it in the long run. Deciding between a live band and a playlist? Your future financial situation might have some thoughts about that choice.
This is why the last thing on the list above, the five-year plan, is an important part of your debt conversation. If it takes you an extra year to get your finances under control, is that worth it? Does that turn your five-year plan into a seven-year plan, and will you feel OK about that result? Predicting your feelings in a few years isn’t easy, but it’s at least worth thinking about.
Lingering debt, especially when it’s concealed, has destroyed many a marriage. Alternatively, working together to pay off credit cards and start with a clean slate can make your union stronger than you ever imagined. Paying off old bills might be the most important thing to do before heading to the altar.
2. Holidays and Travel
From college until the early days of your marriage, your holiday routine stays fairly consistent. Your family vacations might go unchanged as well. After your big day, you’re part of a second family that also has a set schedule for holidays and trips, and blending these calendars isn’t particularly easy.
Figuring out who goes where for summers, Christmas, Thanksgiving, and all the other important dates usually take sacrifice and compromise. It might feel like the kind of thing that can get sorted out on an annual basis, but that thinking leaves you in a predicament where one family could get overlooked because of expenses, schedule changes, or any other unforeseen conflicts.
Holiday gatherings and summer vacations are some of the best times of the year, but they come with a tremendous amount of stress. Plane tickets cost a small fortune, traveling with youngsters fries your nerves, and that’s all before you have any awkward interactions with in-laws!
Once you’re married, you need to tackle these endeavors as a team; plan in advance so you can save money and schedule effectively; make family members happy on both sides, and create a united front when you have to deliver bad news to a mom who’s used to seeing her son or daughter for every holiday.
This planning requires the same level of honesty and thoroughness as the debt conversation.
You should discuss which holidays are most important to you, your parents and your relatives. Talk about past vacations and whether you’re a skier or a snorkeler. If this sounds tedious, just think of it as one of the many joys of getting to know the most important person in your life.
Be forewarned: this can be an emotional process. Marriage launches two lives into the future, putting the focus on the years to come and, in some cases, providing concrete evidence that the past has passed. This is another good reason to talk about holidays and traditions before signing a marriage license; you don’t want to confront delicate personal matters at the last minute while looking for the cheapest airfare.
While holiday travel changes dramatically when you’re doing it with your spouse, it shouldn’t change your relationship. If you have some agreements and rules, the whole process becomes easier for everyone involved and you can focus on the fun you’ll have when you reach your destination.
Also, a little Taylor Tip: if one half of the family isn’t particular about whether you visit at Thanksgiving or Christmas, think about which place is the hardest to reach. Because Thanksgiving comes with such specific travel dates, flights are usually more expensive around that weekend. Meanwhile, at least one leg of your Christmas ticket should be somewhat affordable. If you have to travel in November and again in December, you might save money by taking the longer trip at the end of the year.
3. Career Aspirations
I don’t believe anyone should have to choose between a career and a family, though I applaud people who make this choice consciously and confidently. In any case, balancing your professional and personal worlds can involve a lot of compromises, and it’s important to get everyone on the same page.
In fact, talking about your career goals has become increasingly important in the last decade. People go back to school in their 30s, change careers multiple times, and turn side hustles into full-time positions. These options stay open whether you’re married, single, or a parent; unfortunately, these opportunities become limited when there isn’t enough give and take in the relationship.
It’s still common for a couple to put one person’s career ahead of the other’s, and this practice isn’t necessarily bad. If a husband or wife loves their job and makes good money, there’s certainly no shame in having the partner focus on supporting the breadwinner. However, rising living expenses and student loan debt mean most newlyweds both have to work to make ends meet.
When you both spend 40+ hours at the office every week, you have a couple of hurdles to clear.
First, spending time together becomes a bit of a challenge, especially if you don’t work similar hours. On top of that, working couples deal with a little competition at times. It’s nothing as overt as trying to out-earn each other, but comparing hours worked and dollars earned happens somewhat instinctively.
These comparisons get stronger when two people work jobs that pay the bills but otherwise aren’t that fulfilling. With so many individuals coming out of school with student loan debt, earnings take priority and long-term goals get postponed. If you get caught up in paying for a costly wedding, you might only focus on increasing your salary. While you always want to boost your earning potential, you don’t want to do it at the expense of a better life.
Before you start planning your wedding, put aside a day to envision your professional futures. You probably won’t get every detail right, but you will benefit from setting goals together bouncing ideas around. Even though you might not work in the same field or industry, having the support of your better half is invaluable as you look for jobs and deal with that stress.
This talk should involve some in-depth planning – estimating how long promotions might take, identifying which profession will come with the best benefits, thinking about how a job with a commute can affect family life, etc. These topics might seem like distant fantasies before you’re officially wed, but life comes at you fast. With rings on your fingers, you’ll immediately start looking at life’s biggest decisions (specifically the next point on this list), and establishing career paths will remove a lot of the ambiguity young couples face.
4. Houses and Kids
There aren’t many ways to prepare for having kids or buying a house other than to go out and do it. You can read all the books and speak to all the advisors, and while those efforts will help, you can’t fully comprehend these steps until you take them.
Even so, you can make sure everyone agrees on a few important details. If you’re getting married in your early 20s and want to have children right away, put that information on the table. You could find out that you and your partner have different plans for when to have kids, and that means you have some serious compromising to do.
You might also discover that your house-buying goals and your child-rearing plans don’t quite line up.
Both these endeavors come with significant price tags, and trying to do them at the same time can force you to absorb more debt than you can handle. As beautiful as it is to start a family under your own roof, it’s not worth crippling your financial future.
This means you need to think about not just how many children you want and where you hope to live, but what timeline seems realistic for both pursuits. You might agree to wait a few years before revisiting the kid conversation, or maybe you’re both of the mindset that renting is better than owning. If you already agree on everything, more power to you.
For those who need to reach a compromise, it’s always better to start the discussion early. If you wait until after you’ve had a baby to talk about housing, things have already complicated tenfold. If you buy a house before talking about how big you want your family to be, you could end up back on the market because you need more bedrooms.
I don’t mean to gloss over the bliss of bringing a life into the world or the joy of moving into your own home; those events have no parallel and I wish everyone could enjoy such wonders. I do, however, think you’ll be able to make more of these moments when you plan accordingly and think things through in advance.
The List Goes On
After you go over the above topics, you’ll still have a lifetime’s worth of things to discuss. Looking at schools, saving for retirement, budgeting for groceries, and picking out bedsheets are just a few of the projects you’ll get to tackle as a team.
If you have these important conversations before the big day, you’ll feel that much more confident as you step into the rest of your life. You’ll also strengthen your bond, which will be extra important as wedding stress mounts. The day you get married is all about love, family, and happiness, but it’s also a tiny test for your relationship going forward. Approach the day with grace and support each other throughout.
The more effort you put into facing life as a supportive duo, the more you’ll be rewarded and the happier you’ll be. Address the big issues at the outset and you’ll be ready for whatever comes your way.
Taylor & Megan Kovar
The Money Couple
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