Summer is a favorite time for weddings. If you're planning a wedding this summer, financial and tax issues are probably the last thing on your mind. But before you head down the aisle to say your "I do's," having a serious money talk with your mate-to-be could be well worthwhile.Getting married?
Then it's time to talk money and taxes
Before marriage, couples tend to see each other through rose-colored glasses and may overlook the fact that they do not share attitudes toward such matters as saving, investing, and credit card debt.
Having different attitudes toward money can cause a serious rift in a marriage, leading to frequent arguments and even eventual divorce. Discussing financial issues prior to marriage can make for happier times after the wedding. If you don't know how your spouse-to-be feels about money matters, have a serious discussion. If you've already spotted habits that concern you, include these issues in your discussion.
You may even find that it makes sense to visit an accountant before the wedding to get information about how marriage will change your tax and financial situation.
Topping the list of the tax issues you should check out is how the marriage penalty will affect you. Many working couples pay higher taxes than they would pay on the same income as two singles. There's not much you can do to avoid the marriage penalty short of not getting married, but if it will affect you, adjust your withholding to cover the tax increase.
You should review the investments each of you has and consider any realignment that's necessary to keep your new joint portfolio properly diversified. You'll also want to check your health insurance coverage and see if you want to maintain separate coverage or change to joint coverage on just one plan. Life insurance should be reviewed for a change in beneficiary designation, if appropriate. If you're planning to buy a home soon after marriage, you'll need to decide how to take title and soon after that, you'll want to consider writing or rewriting wills.
While it's not particularly romantic to bring up money and taxes before the wedding, doing so may increase your chances of living happily ever after.
© Copyright 2000 Raymond S. Kulzick. All rights reserved. 000608.
This publication provides business, financial planning, and/or tax information to our clients. All material is for general information only and should not be acted upon without seeking appropriate professional assistance.