Rarely do any topics elicit more passion than love and money, but waiting until after the knot is tied can be a disastrous time to learn that the two of you do not see financially eye-to-eye.
Michael Mulkey, a financial adviser in Muncie, Indiana, says couples need to discuss their feelings about money early in their relationship and be observant. "If your potential partner's got significant credit card or college debt and no retirement savings or other assets, you may be entering into a financially stressful relationship. Someone who regularly pays their bills in full and follows a budget is saying they're financially responsible."
While no one can say for certain if a couple will be financially compatible, the sooner attitudes are shared the better. "Younger couples, at least initially, are often in agreement," says Ron Nichter, an adviser in Pendleton, Indiana. "But often they've yet to be challenged."
Affording a down payment and then a mortgage generally top the list for those considering marriage. Other decisions, such as whether or not to purchase life or disability insurance or to save for retirement, as fewer companies now provide such benefits, can complicate matters.
"There's a finite amount of money but a seemingly infinite amount of things to spend it on," Nichter says. "When children arrive, things can change." Hot-button issues: should one spouse stay home or should each continue working and get child care? Should money be put aside for a child's future or invested for retirement? Should you move to a larger house? A better school district? More subjective issues like ego and status can lead to conflict. Is it important for one spouse to have a new car every other year? Maybe the other spouse would rather keep the old car and pay down the mortgage?
The largest money mistake: "I will be able to change him or her," says financial planner Roch Tranel of Libertyville, Illinois. "Your spouse has been programmed for 20 years or so by Mom and Dad. Your love and nagging are not going to move the needle very much."
The kind of household in which one was raised will often influence their views on money. Watch for signs, Tranel advises. "Is Thanksgiving dinner simple and more about family or about letting peers know you ate at a country club? Is the parents' house decorated with the latest flat-screen TV or is a 20-year-old set still in use?"
Justin Halpenny, a financial adviser in Lisle, Illinois, says newlyweds should set up an automatic savings and investment plan. "Hoping to put something aside at the end of each month rarely works," he says. "There are too many demands. Having funds automatically deducted and invested is a great way for a couple to start saving." Such plans can be started for as little as $50 per month.
Financially conflicted couples, according to Halpenny, should seek the help of an independent financial adviser. "An impartial professional can help sort things out and create a plan." Need help finding one? Ask an accountant or lawyer for a referral or visit cfp.net for a Certified Financial Planner in your area.
Joseph Finora writes about personal finance: firstname.lastname@example.org