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Walking Down the Aisle on Firm Financial Footing
The Savvy Consumer

By Teresa McUsic

With wedding season in full swing, economic realities are starting to bear down on the fairy-tale festivities.

The average cost of a U.S. wedding has decreased slightly this year to $28,704, breaking a cycle of years of increases, according to The Wedding Report, a research firm.

At the same time, nearly half the caterers surveyed said they had seen a decline in wedding spending since the economic downturn, according to the National Association of Catering Executives. Sixty percent are seeing less-expensive meals being ordered.

Other cost-saving measures include choosing Fridays and Sundays for weddings over the premium Saturday event, changing receptions to the cocktail hour instead of paying for full-course dinners and shopping for discount dresses over designer wear.

This new sense of frugality could be the spark to encourage couples to look beyond the wedding and map out the rest of their financial lives, say local financial planners.

“The Number 1 reason for divorce is financial strife,” said Dennis Carpenter, a certified financial planner and president of International Wealth Management in Grapevine. “A good financial conversation with one another is really helpful to a marriage.”

Here are 10 things you should talk about before heading down the aisle.

1 What was his or her family financial history?
Your financial habits often come from how you were reared, said Kevin Williams, a credit counselor with Money Management International of Fort Worth. So find out about the kind of financial household your intended grew up with. Did it live modestly within its means or on the edge of a financial cliff?

“That will tell you things like if they don’t have respect for money and do things like use credit cards to supplement income,” Williams said. “It will help them know your partner’s weaknesses.”

2 What is your money philosophy?
I’ll be the first to admit I don’t like spending much money on gifts at the holidays, while my husband is more generous. It’s taken years for us to come to a good compromise. Knowing how you each approach money is a good first step.

“The most important thing to know is what money means to them and what’s important to them,” said Scott Clarke, a certified financial planner and divorce planner in Bedford. “When people show up in my office, it almost always links back to that.”

3 What is your credit score?
Pull each other’s credit reports off the Internet and look them over together. (You can do this for free at www.annualcreditreport.com or by calling 877-322-8228.) Go to each credit bureau and pay for the score as well.

“Each person needs to know what they may be inheriting,” Carpenter said. “It may be that you will want to put the title of certain assets [like vehicles and houses] in one name, if the credit score is low for one party.” This strategy could save you on interest-rate charges.

4 Drowning in debt?
Bringing debt owed into a marriage can be stressful, but it’s worse if you don’t tell your future spouse. Discuss student loans, credit-card debt being carried over each month and anything else you owe upfront -- plus your plan for paying it off.

5 What are your financial goals?
Does one of you want to stay home when children come into the family? Do you want a house? Do you want to pay for private school or college? Do you want to start your own business or go back to school? By mapping out some goals, even if some end up changing over time, you can come up with some shared ideas of what you want to work together to do. If you don’t share the same goals, this is a time to start making compromises.

6 Do you have health and life insurance?
With one quarter of the Texas population without health insurance, this is an important question to ask. It’s also time to find out what benefits your future spouse may or may not be taking advantage of through his or her company. Check out the health-insurance coverage at both companies and see which has the best benefits for the lowest cost.

7 Do you have a budget?
It’s important to know whether your future spouse has lived on a budget or just lived hand-to-mouth each month. Without a budget, it’s difficult to make any financial goals, Carpenter said.

8 Where do you draw the line?
Clarke said he won't buy a pair of $60 running shoes without first running it past his wife. With dueling credit cards, checking accounts and ATM cards, keeping track of who is spending what can be stressful for a couple. Make sure you set a limit on how much each of you is comfortable with the other spending before it shows up on a credit-card or bank statement.

9 Who’s going to manage accounts and investments?
Keeping track of the monthly bills and the long-term investments and communicating that information with your spouse is vital to a marriage, Clarke said.

“Where people mess up the most is how they manage their cash flow,” Clarke said. “People can start to live in a gray zone where there’s no accountability, and then they start blaming the other for their financial problems.”

Williams said he rarely sees a couple come in together to discuss their financial problems.

“Most are married, but only one half of the couple comes in,” he said. “I always tell them that I need to relay this information to both of them.”

10 How do we mix assets?
Texas is a community-property state, so assets upon marriage are generally owned by both parties unless spelled out in a prenuptial agreement, Carpenter said. If you both own houses you want to sell, for example, you may want to time the sale before filing taxes together to claim both exemptions.