Preparing financially for a successful marriage
Tu B’av and the hectic summer wedding season are over – dresses and suits put away, caterer, band, florist and photographer paid for – so I thought it appropriate timing to discuss some thoughts and pointers about preparing financially for marriage, that are relevant to pre-weds, newlyweds and even veteran weds!
Preparations for the wedding will almost always include the crucial technical details such as location, band etc, and will often include spiritual preparation for building a bayit ne’eman b’Yisrael. But whereas – hopefully – the wedding and all its trimmings were budgeted for properly, sometimes people give little thought to financial management and decision making after the marriage.
Plans can range from the very practical, hands-on and organized variety to the more spiritual versions. Some like to assume that G-OD will help – or as my father is known to quote “Good Old Dad” – while others work on their bitachon in Hashem. One major decision in any event revolves around whether to keep one’s finances separate or unified. Often couples who get married later in life, or marry in countries where the divorce rates are very high, will choose to keep their personal finances separate.
In Israel this scenario often plays itself out with second marriages or when couples get married a little later than the average. In those cases having separate financial bank accounts where spouses share the various monthly costs of running their household can in many cases be ideal. Costs might be split according to earning power, ability to pay, or pre-agreed upon roles (one spouse might be tasked with staying home and raising the children while the other works full time) or based on any mutually acceptable formula.
Other couples who get married younger will often begin their marriage with a joint financial outlook. Joint accounts for the couple create a sense of unity and shared vision, which is ideally reflected in their joint prioritization of spending. The couple should work together to ensure that their spending is mostly agreeable to both of them. Whereas they need not necessarily agree on all expenses, it is critical that they prioritize jointly how to manage their typically limited resources.
Regardless of the plan you feel best suits your needs, and irrespective of your stage in married life, the following critical points will help to ensure that your marital finances remain blissful.
- Openness and honesty – while spouses deservedly often want financial privacy, I have found that too much privacy is often a recipe for disaster. Lack of open communication results in a lack of trust that can put tremendous strain on a relationship. Consider setting up a time once a quarter or every half a year to review the family finances in a relaxed non-confrontational atmosphere before any issues develop.
- Defensiveness or being overly protective can be very dangerous – in many situations, even when communication has been open and forthcoming, spouses who encounter financial difficulties often rationalize the need to hide and cover-up financial mistakes and difficulties. Unfortunately I have come across several examples of spouses who covered up major debts (even when they were not created with illicit or illegal activities) and when things blew up, it ended in the breakup of the marriage.
- Flexibility – what might have been a good arrangement earlier on in a marriage might need to be adjusted over time. You need to be flexible enough to consider new options as your situation changes. Just because one particular spouse always paid the majority of the expenses, times change and adjustment might be required. Even if the couple preferred separate bank accounts early on in their marriage, that doesn’t mean that they shouldn’t consider unifying their accounts after years of marriage, especially when the costs of maintaining separate finances grow over time.
- Get help when necessary – sometimes working with a financial professional who has experience working with couples can help to bridge gaps between spouses and can facilitate the making of difficult decisions. When a third party specialist recommends a solution, it is often easier for both parties to accept the recommendation rather than one spouse possibly feeling they are making all the compromises.
- Share the load – even if one spouse takes the lead on managing the family finances, both spouses need to know the basics. Make a list of investments, bank accounts, insurance policies and other critical documents so that both spouses know where everything is and who the relevant contact person is. One sees it more with women who feel they can leave the financial management to their spouse and be completely ignorant of what goes on financially. Unfortunately all too often that’s a recipe for disaster.
Mazal tov to you! No matter how recently or long ago you got married, congratulations on building and maintaining a life together. But if you haven’t already done so, give some thought to see which of the above points are relevant to your relationship and add to your wedded bliss with enhanced financial bliss! You’ll see that they go hand in hand.