Money Quiz for Your Marital Partner

Physician's Money Digest, September 2007, Volume 14, Issue 9

According to a USA TODAY/CNN/Gallup Poll, spending too much and saving too little are two common financial issues that cause strife among couples. The study also found that nearly two thirds of married couples said they talked little or not at all before the wedding about how to combine their finances.

The following questions should be addressed before the wedding:

  • What are your debts? If one or both partners has significant student, credit, business, mortgage, or other debt, discuss how those debts will be repaid, by whom, and by what time. Before you sit down, both of you should agree to pull your latest credit report and share it with the other.
  • What about the kids? If one or the both of you are bringing children into the relationship, cover all the emotional, logistical, and money issues associated with blended families. Discuss current child support arrangements, how ex-spouses or partners will fit into the picture, and where money for that child's everyday expenses and education will come from.
  • Where should we live? If one partner wants to live in a mansion and the other is content with a three-bedroom ranch, that's a critical difference in financial goals. Where and how you and your partner want to live is a major issue that needs to be discussed before you move in together.
  • Do you like to spend or save? Have a discussion about money behavior. Own up to your money habits and make a plan so you can live a good life together without too much frugality or irresponsible spending.
  • Have you ever filed bankruptcy? You may trust your partner with your life, but you really need to ask this question. If they filed more than 7 to 10 years ago, a bankruptcy may not show up on their credit report, depending on their agreement. If they filed earlier, you really need to know when, and most important, why.
  • How will we pay the bills? Two-income or single-income couples need to decide how the checkbook will be controlled. There’s no single correct way to do this, but establishing a joint checking account to funnel money toward bills, retirement, and investment accounts might be a good way to start. It requires both parties to step up to the plate on a monthly basis with whatever funds they’ve agreed to put forth.
  • What about retirement? At whatever point in life you’re entering a relationship, you need to discuss how set you are for retirement. Talk about assets in your 401(k), IRA, and other investment accounts. If one or the both of you haven't taken any steps to plan for retirement, you're going to need to change that. If you vary widely in age, it's wise to ask for advice because one spouse will be retired long before the other.
  • What is your estate plan? Once you marry, make sure you both have wills and health and durable powers of attorney in place. Domestic partners should consult an attorney or financial planner with expertise in their state's estate and child welfare laws to assure that the surviving partner's financial and parental rights are protected.
  • Do we need a prenup? Generally they're done when one or both partners have assets or a business they want to protect in case of legal separation or divorce. Prenups are becoming more common in this day and age, and don’t be afraid to discuss one with your future spouse.

Reprinted with permission from the Financial Planning Association (www.fpanet.org), the membership organization for the financial planning community.