By Douglas Goldstein, CFP®

Now that you’ve decided to tie the knot, the soul-searching begins. No, I’m not referring to choosing the perfect caterer, but to the realities of everyday life. Ideally, when you were still dating you discussed finances, and perhaps even commented on how your parents run their own households. But now that there’s a new life ahead of you, you can determine your own financial future.

Discuss your single credit card bills and spending habits. Decide whether you’ll have a joint account or a combination of separate and joint accounts. Discuss your long-term financial goals as well as the daily technical stuff, such as who will balance the checkbook and pay the bills. Most importantly, be open and honest about your finances.

Take care of the paperwork
Make or update your will. Review health and life insurance policies (and rental insurance if you’ll be renting). Do names need to be changed on bank statements and cell phone bills? Calculate a combined net worth to know where you are as a couple and then develop a budget. If you begin your married life with a clear financial picture and goals, you have a greater chance of avoiding the finance-related conflicts that plague many couples.

Overspending strains budgets and relationships. All too often, financial difficulties are a key factor in divorce. One client, in the midst of a divorce, told me, “We made some poor financial decisions when married, but now that I’m leaving her, it’s impossible to escape the consequences of those decisions. I’ll be paying off the accumulated joint debt and child support for decades.” Indeed, there’s a reason why divorcees frequently have a lower life style when separated than while living together: two households are more expensive to run than one. If you see your ex living it high, while you’re keeping to a tight budget, don’t assume s/he knows what s/he’s doing and is living the good life. Being practical and budget-minded may not be fun, but these are the characteristics of building a solid fiscal foundation.

Whether newly married or newly divorced, when you’re standing at the crossroads of your life, make sure the decisions you make are financially sound.

Douglas Goldstein, CFP®, is the director of Profile Investment Services. He is a licensed financial professional both in the U.S. and Israel. He offers securities through Portfolio Resources Group, Inc., Member FINRA, SIPC, MSRB, NFA, SIFMA. Accounts carried by National Financial Services LLC. Member NYSE/SIPC, a Fidelity Investments company. His book is available in bookstores, on the web, or can be ordered at: www.profile-financial.com (02) 624-2788 or (03) 524-0942.