Why Premarital Financial Planning is Important
Divorcing couples cite money and differences over finances as the number one reason for splitting up every year, nationwide. Premarital financial planning is important for a number of reasons, although many people dislike discussing it. Some people see it as tacky to discuss money, but failing to do so can cause considerable strife as a married couple if you are not prepared. Premarital financial planning can save you and your future spouse from stress and financial ruin with minimal time or cost prior to the wedding.
Premarital Financial Checklist
Utilizing a premarital checklist is an honest and open way of communicating about finances prior to the wedding that ensures that both couples are fully knowledgeable and on the same page about their finances going into marriage. For any questions that cause disagreements to arise, do not skip over them. Take your time to discuss your differences and come up with a compromise or solution before continuing through a checklist. Using a neutral third party, such as an attorney or trusted family member can also be helpful for managing disagreements that arise. Questions on a premarital financial checklist can include the following:
- What assets and accounts are you bringing into the marriage?
- What are your debts?
- What is your credit score?
- Have you ever filed for bankruptcy?
- Are you a spender or saver?
- What do you consider to be essential and non-essential?
- What do you like to do with extra cash?
- Do you want combined or separate accounts?
- Do you have a financial advisor?
- How important is it for you to manage the finances?
- Who will pay the bills and taxes?
- How soon can we accumulate an emergency fund?
- What are the major purchases we will make in the next two years?
- When do we want to start a family?
- Will one or both of us continue to work after children?
- What are our retirement goals?
- Do you want to sign a prenuptial agreement?
Another option for premarital financial planning is the creation and signing of a prenuptial agreement. Television and pop culture have demonized prenuptial agreements as documents only signed by wealthy men and their much younger wives, but prenuptial agreements can be an incredibly helpful financial tool for premarital financial planning.
If one or both future spouses are coming into the marriage with separate real estate, a business, or significant assets, a prenuptial agreement can safeguard those items in the event of a divorce or designate what should happen to them if financial difficulties arise. A prenuptial agreement can help avoid many arguments and settle disagreements about finances before they arise. An attorney can help you draft a prenuptial agreement that benefits all parties and manages all issues of premarital financial planning before the wedding.
Premarital Financial Planning can Help
If you have questions about premarital financial planning or creating a prenuptial agreement, an experienced family law attorney may be able to help. Call or contact a lawyer in your area today.