Newly Married Financial Checklist Part 1: A financial checklist of things to consider and actions to take for those getting married or are newly married. BY BRIAN D. BROGAN
Putting together a financial plan early on can save you money and headaches down the road.
For those of us, who have been married for a few years, a feeling of comfort and routine is probably setting into our lives. This is a good thing! When it comes to finances, however, routine and comfort is not always the best advice.
I recently sat down with a couple who are to be married next summer. They had some concerns about how to start thinking and behaving like a couple with their finances.
I was excited to meet with them knowing that by taking the proactive steps to address these concerns now we were going to have a very productive meeting.
After getting some background information from them both, I asked what specific concerns they would like to address at our initial meeting; I do this to make sure I don’t miss the mark in giving advice versus pushing only my agenda or what I think they should know about marriage and money.
I am glad I asked. It is so easy to overlook the first steps or the obvious ones. The three areas that were brought to my attention were:
1) Credit—how to establish it and do you need it?
2) Savings—how to save and where to do it?
3) Housing—should we move into our partner’s home or get something new to us both. And what’s the best mortgage and how do you title it?
These are three very big concerns for any couple about to be married or newly married. In fact, these areas of concern may have never been addressed for couples already married. In this article, I will list five of 10 "action steps" I feel all couples should address and where to find this information on your own. In part two of this article, I will complete the list.
Here are the first five items on the financial checklist couples should address in the first year of marriage:
1) Pull your individual credit scores and make sure all information is correct. It’s your right to do this free once a year from all three credit agencies (Experian, Equifax and TransUnion). You can get your credit score from www.annualcreditreport.com. Make sure you get a FICO score or ratings range from all three agencies. There may be a fee if you choose to pull a three-in-one report. I did this and like it.
2) A prudent step would be to purchase identity theft insurance from your local provider. This goes further than just monitoring and goes onto help repair the damage incurred if there was a theft.
3) Purchase money management software and start understanding how much money is coming in and where it all goes. I recommend that you just monitor and code your purchases for a few months until you get a feel of your financial life. Once you are comfortable with this step you can start to look into a budget.
4) Open a direct saving account at one of the large institutions like ING or Citibank. The reason is clear, a much higher interest rate. Set it up to start saving every two weeks or manually when you get paid. If you're old school, like me, you may still be afraid of this thing called the internet, but if you can make the change then you can more easily monitor and move your money.
5) Get a good accountant and ask one good question to him or her. "Do you think as a couple we are entitled to a greater personal deduction than the standard which we are currently taking?" The key to number five is that it comes by you directly following step number three. Once you find you have been spending your own money for business and personal education, etc. you may be do for a higher return.
My approach to financial awareness is a holistic one. I believe that financial awareness comes in levels and they are all interlinked. In learning and mastering one step you can apply that knowledge to the next level.
I look forward to sharing the rest of the check list in an upcoming article.
Vice President Brian D. Brogan of H.G. Wellington & Co. Inc. Mr. Brogan can be reached at firstname.lastname@example.org or 610-896-8823.