Money Planning for Marriage

There are magazines and websites devoted to planning a wedding—but hardly any that focus on post-wedding finances. Is it any surprise that so many couples end up in a divorce lawyer's office discussing who gets which wedding present?

Finances are a leading cause of marital disputes, so before you walk down the aisle, make sure that you and your soon-to-be-spouse have compatible attitudes toward money. Take the Financial Compatibility Quiz and find out.

Eight or more True answers: You and your future spouse are on your way to a stable financial future. Keep communicating and working together.

Five to seven True answers: You and your future spouse need to spend a little more time to planning your financial future together. With a little luck, you can achieve financial compatibility.

Less than five True answers: Don't call off the wedding...yet. Instead, sit down and discuss these issues. Consider meeting with an experienced financial planner who can help you start your marriage on a firm financial footing.

Read on to learn more about the importance of each question:

1. We are aware of and comfortable with each other's money personalities.
   Some of us grew up in families where parents watched every dime; in other families, the money flowed easily. Some of us are natural spenders and some are natural savers. Understanding each other's attitude toward spending, saving and investing can help avert problems later.

2. We have discussed our short and long-term financial goals.
   Setting financial goals helps you develop priorities and define the way you will live. Break goals into manageable bites. If you want to buy a house in five years, determine how much you have to save each month to meet the down payment.

3. My spouse and I are well versed in personal finance.
   If neither one of you is a financial expert, work together to develop your financial knowledge by taking a course, meeting with a financial planner, or simply reading a few good books on the subject.

4. My future spouse and I have discussed a plan to structure our finances.
   Will you pool all your resources into joint accounts, maintain separate accounts or devise some combination of the two? The plan that works for you is the right answer.

5. We have planned for the impact that marriage will have on our taxes.
   In Canada, couples file their tax returns individually rather than jointly. Spousal Registered Retirement Savings Plans can affect the amount of tax paid by the higher earning spouse. Consider this when making your financial plans.

6. We have decided how to divide up the money management tasks.
   Decide who will be responsible for balancing the checkbook, filing taxes and tracking investments. If both of you are interested (or not interested) in doing this, set up a plan for rotating these tasks.

7. We understand the importance of establishing a realistic budget.
   A realistic budget can help you to save for the things that really matter to you rather than frittering away your money on day-to-day expenses. It also helps in avoiding misunderstandings about money.

8. I know my future spouse's investment personality and risk tolerance. Investment styles range from conservative to risky. Find a level of risk where you are both comfortable.

9. I know how much debt my future spouse is bringing into our marriage.
   Neither of you want the unpleasant surprise of having collectors calling your new home. Calculate how much you both owe and determine how you will pay it.

10. We have made a commitment to discuss money regularly.
    Financial differences are inevitable. Regular discussions of finances will help resolve those differences.