You’ve unpacked your honeymoon bags, opened all your presents, and had your dress dry-cleaned. With the wedding whirlwind calming down, you and your new spouse finally have some space to breathe.
As you settle into the rhythm of your new life together, be sure to make time for your finances. Ideally, you laid down some groundwork before tying the knot, like mapping out a budget and discussing how you’ll pay the bills. (If not, no worries — this guide will get you started.)
Now, you can take the next step: These four simple yet critical to-dos will set your twosome up for success.
Even if you’re young and healthy, life insurance can protect you from curveballs. So after you’ve said, “I do,” make sure you’d each be able to stay afloat should anything happen to the other.
“The purpose of life insurance is to guarantee that you or your spouse would be able to meet your money obligations if one of you passed away,” says Chad Rixse, financial advisor and founder of Far North Capital in Anchorage, Alaska. “If you’re the breadwinner and your partner wouldn’t be able to survive financially without you, then it makes sense.”
It’s also smart if you have kids, a mortgage, a joint car loan, or significant debt (if you live in a community property state, your spouse will be responsible for debt incurred during marriage).
Now is also a good point to think about estate planning. If you have any collectibles or tangible assets that you want your spouse to get (say, a classic car or piece of art), spell that out in a will, Rixse says. Add your spouse as beneficiary on your retirement accounts, and establish a transfer on death registration for individual taxable investment accounts, like a brokerage or money market account. Those moves can help smooth the transition of financial assets to your spouse in the event of your death.
Married couples have the option to join one another’s health insurance policy. “Look at each of your plans side by side to see which is more favorable in terms of cost and coverage,” Rixse says. Compare the following: percentage of the premium you’re responsible for versus what your company pays, deductible, copay, in-network and out of network coverage, and price increase of switching from an individual plan to a family plan.
Insurance companies typically set a deadline of 30 to 60 days post-marriage to switch to your partner’s plan. Otherwise, you have to wait until the next open enrollment period. If you change policies, you may encounter a waiting period before certain benefits kick in, so check with your insurance company or HR. In that case, you may want to stay on your individual plan until full coverage has been activated.
It’s also usually beneficial to consolidate your property and casualty insurance—like car insurance and homeowners or renters insurance. “Combining policies can yield better rates,” Rixse says. Plus, car insurance companies may offer a multivehicle discount.
Setting up a bank account together is straightforward: Head to your bank with your marriage license and driver’s licenses. (Unsure whether to join forces? Learn about the best financial setup for your twosome here.)
Opening up a credit card you can both access is a stickier prospect. Rixse suggests that you first confirm your spending habits are in sync and sustainable. “Then, come to a consensus about what purchases you’ll use the card for and how the bill will get paid,” he says.
The upside? As long as you’re both savvy with your spending, using the same rewards card can maximize your points.
If one of you has better credit than the other, take out the card in the higher-score person’s name, and add the lower-score individual as an authorized signer. “As a result, you’ll have a lower interest rate,” Rixse says. “You’ll also be given a higher credit limit, which keeps your utilization rate low and improves your credit score.”
In most cases, after the wedding you’ll want to adjust how much tax your employer is withholding from your paycheck. Neglecting to make that adjustment might mean you’re not paying enough taxes during the year, setting you up to owe a penalty for underpayment. Or it could mean you’re paying too much in tax, forgoing a bigger paycheck year round.
Plus, you’ll have a higher standard deduction when filing jointly. “It tends to result in a lower tax liability,” says Gail Rosen, a certified public accountant in Martinsville, New Jersey.
You can update your W4 by going online to your payroll company or contacting HR—just make the modification the same year you exchange vows. “Even if you get married on December 31, 2019, the tax law has you married for the entire 2019,” Rosen says.
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