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Financial Planning > Tax Planning

6 Tips for Shared Financial Bliss

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First comes love, and then comes marriage. But what’s the cost of shared financial bliss? Salient question from TD Ameritrade, and one they (sort of) answer. With money a central factor in divorce, business is good for lawyers and certified divorce financial analysts, but few others.

A recent survey conducted by the clearing and custody firm revealed that the average couple discusses money less than two times a month and fights over money, on average, five times a year.

“With the median age for first-time marriages approaching 30, combining finances is not as simple as it once was,” Carrie Braxdale, managing director of investor services at TD Ameritrade, notes in the report’s release. “Couples are bringing more financial baggage into the relationship than ever before. They have 401(k)s, student loan debt, investments and even mortgages. So, it’s more important than ever for couples to talk about their finances and work together to develop a plan.”

The Dating Game

When it comes to choosing the perfect partner, personality (20%), character (18%) and looks (17%) topped the list. Things like money (5%) and potential earnings (3%) were less important.

However, the survey found that certain poor financial habits are undesirable in a potential partner. Lack of motivation to get ahead (66%), relying on parents for financial support (65%), having significant credit card debt (65%) and poor money management skills (64%) were the most common financial deal-breakers in selecting a potential mate.

The survey also revealed some financial trust and transparency issues among couples:

• Forty percent of respondents said they did not completely trust their partner to manage their combined finances

• More than one in three (38%) said they were only somewhat, slightly or not at all aware of their significant other’s debts

• One-fifth (21%) said they sometimes hid their spending from their significant other

Wedding Bells

According to the survey, nearly 60% of couples are paying for their own wedding, at an average cost of $28,000 for Gen Y. What’s more, that price tag doesn’t include the honeymoon costs, which add another $3,400 on average. But these young couples think it’s worth every penny—82% say they don’t regret how much they spent on their wedding, and 89% don’t regret what they paid for their honeymoon.

The Honeymoon’s Over

Things like communication gaps and lack of budgeting can cause pain points for couples as they settle into married life. The survey found that 43% of couples admittedly don’t follow a budget, and half of couples jointly share household financial responsibilities. Female respondents said they were more likely to tackle groceries (48% vs. 25% of men), day-to-day expenses (28% vs. 26% of men) and the household budget (40% vs. 28% of men). Meanwhile, male respondents are more often solely responsible for investing decisions (45% vs. 27% of women), retirement savings (39% vs. 25% of women) and tax returns (44% vs. 32% of women).

“While discussing money may not be the most romantic of gestures, it is important to not only have those financial discussions early in a relationship, but to continue having them throughout your marriage to help avoid financial surprises and minimize financial arguments,” Braxdale continued.

Braxdale points out a few easy steps to get couples on the path to financial happiness:

1)       Talk about your financial situation before you walk down the aisle.

2)      Create a budget and talk about savings goals.

3)      Understand the amount and type of debt each partner brings into the marriage, agree on the plans to pay it off, and know your credit scores.

4)      Figure out how each partner manages money. You may be more frugal, but your partner may be more of a spender.

5)      Understand your investments and discuss how to meet your long-term goals.

6)      Don’t leave it all to one partner. Joint participation in managing household finances is key.


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