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Marriage & money
5 Tips: How to talk to your partner about money.
May 16, 2005: 11:08 AM EDT
By Gerri Willis, CNN/Money contributing columnist

NEW YORK (CNN/Money) - It's spring, the unofficial kickoff of the wedding season. With the allure of the diamond ring, the saying of "I do" and the honeymoon, it's easy for altar-bound couples to ignore the fact that they are joining together two financial lives.

If you and your partner don't take time to address the issue, money and relationship problems can arise further down the aisle.

Take today's five tips on talking marriage & money, and you'll live happily ever after.

1. No secrets.

Many couples can talk about religion, sex, and what they are going to name their kids. But often they're far less open about money, which is frequently cited as a reason for divorce.

A survey conducted last year by Smart Money/Redbook of married or cohabiting adults found 36 percent of men and 40 percent of women admitted they had lied to their spouse about what they had paid for an item.

You should disclose as much as you can to each other, including your salary, debt load, student loans, inheritance, savings and credit status. Start by having small conversations on your leisure time. Don't try to fit it in on the way to work or when you both come home and are exhausted.

To put a little sugar on top, talk about your money dreams too. Have you always wanted to travel to Africa? Do you hope to pay for all your kids' college educations? Creating goals will give you the drive to save more. As two, the sky is the limit -- and dreaming about the sky will help you two create limits.

2. Put your own wealth aside.

She makes more and owns the house, so she gets to spend more and gets to make all the financial decisions. That's not the best attitude to have in a marriage. Maybe her husband mows the lawn and cooks her dinner while she works the longer hours at the office so she can earn more money.

By drawing lines based on who is 'worth' more, you're bound to start an argument. You have to agree to work together, talk through things and not bully one another. After all, presumably you did marry for love, not money.

3. To combine or not to combine?

Will your checks say "Mr. and Mrs." or just "Mr." and "Mrs."? If you are a younger couple without a lot of assets, a joint account can work well. This lets you build together from the ground up. Jeff Opdyke, author of "Love & Money," calls this "financial intimacy."

But if you're an older couple or going into a second marriage, separate accounts may make sense. You both may already have successful careers and financial systems set up that you want to keep intact. This is also a good option if one partner has credit card debt that the other doesn't want to absorb.

A third option is to have a joint account for some expenses (joint savings and living expenses) and separate accounts for individual spending money. For instance, you could both agree to put 10 percent of your income in personal accounts and put the remainder in the shared pot.

4. Remember, things change.

Five or 10 years into your marriage, your money concerns are likely to be different from those you had when you walked down the aisle. That's why, in addition to monthly money meetings with your spouse to keep abreast of near-term financial issues, you should discuss your big money picture at least once a year.

Make sure your retirement plans mesh. If one's 401(k) is invested solely in high-risk funds, the other partner may want to diversify more. Make sure, too, that you're still aware of each other's desires and goals -- from taking vacations or buying a home to having children.

And take time to discuss the "what ifs." What if one partner loses his or her job? What if one wants to go back to school? What if someone gets a job in another part of the country? Will the other spouse be willing to pack up and move?

5. Discuss tough topics.

There are some topics that nobody likes to talk about but that need to be discussed, especially when children are involved. First and foremost, make sure you have a will. If you don't make a will before your death, state law will determine who gets your property, or worse yet, even raise your children.

You also want to consider life insurance to provide for your family if you pass on. Finally, talk about a prenuptial agreement if one of you has kids or you're entering a marriage where one partner has a great deal more in assets than the other.

What kind of wedding do you want? Read The great wedding blowout for one couple's answer.

Get started with a joint budget. For help, read Money 101: Making a budget.


Gerri Willis is a personal finance editor for CNN Business News and the host for Open House. E-mail comments to 5tips@cnn.com.  Top of page

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