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As any bride-to-be knows, planning your wedding can dominate your world for months, even years, pushing everything else to the back of the queue.
But now is the time to be thinking beyond the big day. And while finances might not sound as romantic as flowers, frocks and dream destinations, organising your life admin together can set you up for the happiest forever after. And, says Sydney independent financial planner Claire Mackay, it can even be fun.
“I advise clients to treat financial discussions as a date,” she says. “Sit down together with a bottle of wine and see it as an opportunity to open up about your goals, hopes and dreams, then work out how to reach them together.
“You’ve probably discussed every other intimate subject; where you want to live, your spiritual beliefs, having kids,” she says. “But so many people avoid the financial conversations – and you shouldn’t. Finance management is a major factor in whether your marriage is a happy one and goes the distance.”
‘Til debt do us part
As well as a financial hangover thanks to busting that wedding budget or splurging on the honeymoon, there’s every chance you’ll be arriving at marriage with what Claire Mackay likes to call ‘STDs’– Sexually Transmitted Debts.
Honesty, says Mackay, is the key. “It’s really important to be fully open about your financial situation,” says Mackay. “Do you have mortgage repayments, credit card debts, loans? There’s no need to feel ashamed about debt; it’s a fact of modern life. This is about becoming aligned on how you manage it, and playing to your strengths as a couple.”
Practical steps might be finding the best way to pay down the debt as quickly as possible. Credit card interest rates are much higher than other loans so consider rolling over any credit card debt into an existing loan (such as your mortgage) or taking out a personal loan with a lower interest rate.
In sickness and in health
Now is the time to review your private health insurance policy. If your health needs are very different, don’t feel you have to combine your cover, as generally there’s no discount for a couple’s policy compared to two singles policies. Once any children arrive, though, you’ll need to combine as a family. And speaking of those potential little ones – if you’re keen to start expanding, it’s a smart idea to upgrade to include pregnancy cover on your health insurance ASAP. Remember, there’s a 12-month wait period before you can claim any pregnancy costs, and you never know how fast things might happen.
“Upgrading to cover obstetrics can dramatically increase the cost of your policy,” says Laura Crowden from life admin advisers iSelect. “So it could make sense for you to keep your health insurance policies separate and only upgrade the female’s cover to include pregnancy, until a baby arrives and you move over to a family policy.”
What’s yours is mine
In the past, you’ve most likely been used to managing your own money. Now you both need to agree on the level of autonomy within your joint finances.
Some couples opt for complete transparency and share all their accounts. Others choose to maintain a joint account for household bills, while feeding an agreed amount into a ‘secret stash’ for each partner, to spend on whatever they want.
The best solution is different for every couple. When they married earlier this year, Sydney media consultant Emma Castle and her husband Anthony decided to retain significant independence in their finances, because they both brought preexisting responsibilities to the union. “We’ve decided together that Anthony’s child support for his children from a previous relationship, his investment property with his dad, and his business expenses – as there’s a tax structure for those already in place – will remain his responsibility. But we’ve divvied up the household bills,” says Emma.
All things equal
What you each contribute to the household coffers will depend upon your respective incomes, and you need to both be comfortable with this. “Nobody should need to feel guilty for not bringing in as much money, but there shouldn’t be any resentment from the higher earner, either,” says Mackay. “It’s about saying: ‘we’re a unit; let’s work together,’ and how you best deploy your combined resources.”
Home is where the heart is
If you’ve moved into a new home, choose who will pay which household bills, and remember that changing address will impact things like your broadband connection, utilities and even your car insurance premiums. If you are updating your name or address, use it as an opportunity to shop around and make sure you are still getting the best deal.
Where there’s a will
Nobody likes to ponder sad possibilities at such a happy time, but if you prepare for the unexpected now, you don’t need to think about it again. Making a will together is an important step in protecting each other as well as any future children, and it’s also a good idea to name your partner as the beneficiary on your superannuation policy. It’s worth discussing life insurance, income protection, and what would happen if one of you passed away or wasn’t able to work. “We discussed all of these ‘tricky’ things during our engagement,” says Sydney business consultant Sali Sasi, who married her husband Nathan 18 months ago. “For us, it was a natural part of growing intimacy and commitment. We’re in each other’s wills, and we’ve made sure we have all the right insurance to cover things going wrong. Nathan has quite a large business and although I have no share, I know where everything is and if I needed to, I could find it. We both feel better, and closer, knowing we have all those protections in place.”
Getting down to business
Many couples these days enter marriage as business owners. This requires some key decisions, says Mackay. “How much risk do you want to expose your family and home to? How does the spouse get looked after by the business if something happens to you?”
In the name of love
If you choose to change your name after marriage, it’s good to keep in mind the often lengthy process it takes. “You have to be thorough and change everything,” says Claire Mackay. “If some documents are left in your old name, you can end up with some real confusion.”
To change your name you’ll need a copy of your marriage licence as evidence when you update all these: your passport; driver’s licence; car registration; insurance policies; bank accounts; the ATO; electoral roll; Medicare; superannuation; your will; healthcare providers, and subscriptions and memberships. And remember, you’re nearly always required to front up in person with the certificate.
Sali is still only halfway through the name changing process. “I’m using Sasi, my married name, professionally and Nathan is keen for it to be on our baby’s birth certificate, so I’m in the process of changing everything,” says Sali, who’s eight months pregnant. “But there’s so much to do and remember! One of the funniest moments was when I went to the RTA to change it, and they asked me to sign my new name. I hadn’t thought to practice, so I’ve ended up with the lame signature I invented on the spot that day!”
She adds: “It’s a real pain, but you just have to grit your teeth and get on with it.”
At iSelect, we get that most people find choosing the right health insurance policy boring. But we understand that it’s really important to always have the right level of cover. Our expert advisers will give you the confidence to make the right call on health insurance for you and your family.
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