Option #7 Marry Well (Not for Money)

Good Day Everyone!

I hope you all had a fun and happy Labour Day long weekend. As wedding season winds down, I figure this is a good time to talk about thinking of marriage as part of your financial plan. I hope this can help you if you’re not married yet but considering marriage, or couples who are married but haven’t talked about their finances yet.

Marrying well obviously don’t mean marrying someone only if they earn significantly more than you, or someone who comes from a rich family. What I mean is choosing to spend the rest of your life with someone who shares similar goals in life, especially big ones that have significant financial consequences.

Why is this important? Unfortunately I’ve witnessed people close to me go through divorce or breakups over incongruous life/financial goals. I had a four year relationship end because we were at very different timelines in life (especially financially) and we weren’t able to reconcile the difference and decided to move on. Despite what the 1970s hit song says, love alone will certainly not keep you together.

Based on what I have observed in my own life as well as some reading I’ve done, I came up with a list of life/financial questions that you and your significant other should discuss thoroughly before you consider getting married or moving in together.

Where should we live? (current and future)
This question is important to answer because it impacts things from career progression, family, climate preferences and many other important issues. The answer to this question needs to be very detailed and should include the answers to the following:

– rent or own?
– high rise or low rise?
– possible locations
– is relocation an option?

I think that it is important to agree on this because it’s hard to compromise on a lot of these things.

How should we split the finances?
Obviously this is important to figure out before getting married or moving in. The answer to this question is the foundation of your financial day to day for the rest of your lives. I’ve asked around and every couple does the finances slightly different but usually falls in one of the three bucks below.

1) Everything is pooled together and all spending whether it’s for household or fun comes from the same account.

2) Each person gets $X in spending money and the rest goes to bills, investing, saving for goals etc.

3) Complete independence where each person is responsible for paying certain bills, manages their own investments, pays their own debts, and no questions asked on spending decisions.

This is a complicated topic which I will elaborate on in a future post. For now I will say it doesn’t matter which one you choose as long as it’s agreed upon by both people.

Kids? how many?
Obviously this has massive life and financial impact and needs to be discussed before marriage. If you can’t agree on an answer and it’s a deal breaker, then better to know now,

Do you have any debt? If so how much and what kind?
Just because your partner has debt, doesn’t mean you should disqualify them as a candidate as a future spouse. However, it is important to be transparent about the amount of debt, the interest rate, type of debt, and payment plan that each person has. Once it’s all on the table, you can decide if you can stomach marrying into the debt or whether it’s smarter to wait until it’s paid off so you can start your lives together clean. This might not always be possible as student debt these days are out of control but at least knowing allows you to make the best decision possible.

This is a very sensitive one that really only matters if one person has significantly more assets than the other going into a marriage. I’ve heard both sides of the argument (protection, peace of mind) vs (trust issues, looking for a way out before it even started) and I agree with both sides because there’s no right answer to this question. Having family members chiming in on this only complicates matters, and I have seen it happen. Unfortunately there isn’t an easy way to have this discussion, but it’s one that needs to be discussed if there’s an asset gap going in. Failure to agree on this is probably a good sign that marriage is not a good idea.

Bottom Line: It’s never easy to talk about money, but it is one of the most common reasons marriages fail and divorces are likely the 2nd or 3rd most expensive thing you’ll ever spend money on so let’s try to avoid that. There are many more questions you could go through, but from the ones I’ve heard about or read, these five seem to be the most impactful. If I missed some that you feel are important, please feel free to share them.

Have a Great Day!

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