Marriage is an exciting stage in life. This is also the time when the tricky subject of money comes up. For couples, financial planning can be difficult, complex and exhausting without the existence of a financial plan. That’s why we’ve created a cheat sheet on the main economic points to consider when starting your life together.
1. Have a frank discussion with your spouse
Although it’s not very romantic, having a frank discussion about your financial situation will help strengthen your relationship.
Here are some questions that will help you better understand the financial situation of your couple:
What is your level of debt?
What do you plan to do about it?
What major purchases do you plan to make (house, car, etc.)?
How do you envision the next five years? Would you like to go back to school? (Because education costs are high, it’s essential to consider potential loans when planning your financial future.)
2. Make a budget
When you have an overview of your financial situation, make a budget with your spouse. You can find handy tools online to track your expenses, and budget calculators, such as You Need a Budget or Mint. There is no need for a complex application to establish a budget; an Excel spreadsheet is enough. The key is to set a budget and review it regularly, Whichever method you choose. It’s also helpful to take stock of your finances with your spouse to assess your financial health and your saving, spending and investing habits.
Keep an eye on your expenses with our budget calculator.
3. Review your insurance
After the wedding, it’s the perfect time to choose your insurance. Insurance is a safety net for your family in difficult circumstances. Many newlyweds take the time to purchase life insurance or add their spouse to their current policy. Upon your death, your designated beneficiaries (spouse and children, if applicable) will be able to use the capital of your life insurance to cover their living expenses. Generally, this amount should allow your family members to maintain their lifestyle for as long as possible.
Note: You must designate your spouse as the beneficiary of your life insurance policy so that they can receive the capital upon your death.
In addition to reviewing your life insurance, compare your spouse’s premiums, deductibles, reimbursement percentages and health insurance coverage to yours to determine the financial plan that will best meet your family’s needs. You could realize significant savings by using one method or coordinating your benefits.
Also, take the time to talk with your spouse about other types of insurance that can supplement your family income if you or your spouse become seriously ill or disabled. Here are some examples:
Disability Insurance
Critical illness insurance
Long term care insurance
4. Review your will
In addition to reviewing your insurance contracts, you should also check your will or establish one if you haven’t already done so. Your assets will not automatically be distributed to your spouse without a will. The courts may distribute your assets by provincial laws. To ensure that your last wishes are respected, make sure your choice is up to date, as are your designations of beneficiaries.
