When marrying late, the couple has to look after a lot of things other than wedding presents. When older individuals tie the knot, they have to make important decisions regarding their children, house, finances, retirement and so on.
Below we have mentioned three topics that you should discuss with your significant other to take care of your finances as individuals and be protected as a couple in your new marriage.
1. Combining your money after a marriage
A lot of older individuals are set in their own lifestyles and have their own personal money management rules. They have also spent a lifetime to earn important assets. This is where things may become difficult, where one partner spends money wisely and one is less careful about it.
If a partner has a child from their previous relationship, the couple will have to discuss additional issues like alimony and child support. To make sure that the finances are taken care of after marriage, the couple can make an appointment with a financial advisor.
Below we have shared some financial things the couple should discuss:
- Review credit scores and reports together
- Discuss each partner’s indebtedness and find out how much an individual partner is comfortable with
- Talk about bill payments, savings and paychecks
- Keeping separate account or setting up a joint account
- Deciding who is going to be the primary breadwinner or contributing equally
- Discussing investment style whether a partner is conservative or aggressive
- Vision for retirement
- If children from previous relationships are involved, coming up with a formal agreement by discussing the matter with ex-partners.
2. Filing tax
The Her Majesty’s Revenue and Customs (HMRC) advises newly married couples that their name matches with their names on the Social Security System. If it doesn’t match, the couple may face a delay in their tax refund. Also, think whether they want to file their taxes individually or file a joint tax return. People who are remarrying should clear any remaining tax issues with their ex-spouses. In a case where one’s spouse passes away and that individual remarries before the end of the tax year, the individual can file a joint return with the new partner.
3. Estate planning with the new spouse
It is vital that you discuss estate planning with your new spouse as it ensures that in the event of your death, your family’s’ financial needs are met with. If you have children, it is very important that you go ahead with estate planning. Just ensure that you are updating respective powers of attorney. Also, with time you may have to change your beneficiaries for the following aspects:
- Investment fund
- Life insurance policy
- Retirement account
- Other financial accounts
If you haven’t made a Will yet, make one right away as it is possible to make a Will at home and make your family’s future secure. A lot of financial advisors, accountants and estate planners advice that you get a prenup signed from your new partner. A prenup is a set of terms and conditions that divide the finances, assets and responsibilities in case the couple decides to go their separate ways. The agreements should be discussed with a lawyer before marriage.
A prenup can help decide what assets you are leaving for your respective family members in case the couple decides to break up their marriage or one of them passes away. A prenup also stops a partner from challenging other partner’s Will or any existing trusts.
In the end, an individual should know that when they are tying the knot, it will affect their financial freedom in one way or the other. Therefore, it is important that the couple sits together and discuss their financial situations, life goals and talk to a solicitor.
If the couple wants fewer complications, they will be better off keeping most of the property and assets separate especially if they have heirs. Also, to make sure their marriage stays rock solid, the couple should discuss their finances throughout their marriage whether they are poor or rich.