As a wedding planner, Lora Grafenstein-Kinzel has gleaned a lot from her clients about couples and money. There are those who haven't had the money talk despite the wedding being weeks away. There are the ones who don't agree on most spending decisions, or who don't make any decisions, acquiescing to the mother of the bride. Then there are the couples who clearly have a major problem communicating about money, but seem in denial, choosing to believe that once the wedding is done, everything will be fine.
She has news for them. "The wedding isn't going to be the only stressor in their life. A new house, loss of job after the marriage, babies -- those are all stressors in the relationship. They need to work on [their issues] before the marriage," said Grafenstein-Kinzel, owner of At Your Service Weddings in Minneapolis. "They need to get their finances on the same page."
Planning a wedding presents a natural opportunity to discuss everything from income and debt, to budgeting and establishing priorities. However, a recent survey from Country Financial shows that about half of couples don't talk about handling the family finances before marriage. And money is a major point of disagreement for most couples, married or not.
Jon Bauer said having the money talk with wife Sara Ohotto Bauer before getting married last year helped them to make more informed decisions about wedding expenses and develop a plan for gift money.
He admits that the initial conversations were a bit awkward. But discussing financial matters is a necessary part of making a life together. The conversations helped the couple understand each other's financial values as well as create a practical plan for managing their bills. They decided to open three joint accounts -- one for bills, one for discretionary expenses such as vacations and eating out, and one for wedding gift money, which was renamed the baby fund when the couple learned they were expecting a child. They still have their own credit cards so gifts for each other can be a surprise.
James Bryan, a certified financial planner with Cahill Financial Advisors in Edina, said some new couples tend to get carried away and make a lot of big financial decisions all at once. "They have the wedding, they have the big honeymoon, and then they want that beautiful home next to the Cleavers."
He urges couples to pause and assess their life goals and their financial situation. Before buying a house, which comes with a host of additional expenses beyond the mortgage, "get rid of debts, build up savings and max out retirement plans," Bryan said. Don't feel rushed into it by the market. He thinks interest rates and prices will still be low a year from now.
Say you've found your perfect match, but his credit is far from flawless. It's important to understand that marriage doesn't combine your credit histories. Each person maintains individual credit reports and scores. If you have a high 800 credit score, it will stay 800 so long as you maintain your primo credit habits.
