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Ask USAA: How do I merge our finances?

This content is provided courtesy of USAA.

USAA's Scott Halliwell, CERTIFIED FINANCIAL PLANNER™ practitioner, shares five steps to successfully merge your money when you marry.

Hello, and welcome to Ask USAA. My name is Scott Halliwell. We have a question today from Jeremy in Washington. And he says, "I just got married," and he wants to know, "How do I merge our finances together?"

Well congratulations, Jeremy, on your marriage. You know I'm coming up on my 13th anniversary here myself. And frankly, I hope your marriage turns out to be as great as mine has been thus far. Now though, let's talk about the money aspect of marriage. To me, there are five steps that I think are really important to take when two people come together financially.

The first thing you want to do is you're going to want to discuss your relationship with money, that is. Now you want to think about things like is one of you the classic spender or the classic saver? You know do you have any strong feelings about financial matters? You really want to know where each other's coming from.

The second step of the process is to discussion your financial goals. You know here you need to think about what's important to you financially. Do you want to have a house at some point? Do you want to have kids? Do you want to be able to pay for college for them if you do? Is retirement a priority? You know the point of the first step was to understand where each of you is coming from. The point of this step is to understand where you each want to go financially.

The next thing you want to do is you want to take a look at your cash flows and create a budget. Here you're going to try to agree on how much needs to be saved each month, in addition to how much needs to be spent.

The fourth thing you're going to want to do is review your insurances. You know since you're married it's not just about you anymore, Jeremy. And when I say that, I'm talking about taking care of each other here, not who controls the TV remote. You know you need to, when it comes to insurance, assess your needs in all areas. You want to look at things like homeowners or renters insurance, auto insurance, liability insurance, health, disability, even life insurance. The point is you want to make sure that if something catastrophic were to take place, the other of you would be taken care of.

You know finally, you should really create a plan for your situation. Preferably a written plan. You know going through that process will provide you with a clear picture of your new financial reality and your situation, as you bring it all together. It should also result in some pretty good direction for budgeting and savings priorities for you.

The reality is, depending on yourselves for financial knowledge, you could do this planning on your own using some of the online software tools that are out there. But, in many cases, especially with a new marriage, I think it's important to get human involvement. Can really be a big benefit for you. You know a qualified and experienced planner can enhance your understanding of your situation and each other from a financial perspective in ways that a software package can't do.

If neither of you have a planner, or if you'd like a neutral party, we could certainly help here at USAA. For more information on the services we have, simply type financial planning in the search box of usaa.com.

So congratulations once again, Jeremy, on your marriage. I hope these ideas that I've shared are helpful in getting you off on the right foot financially. Thanks again for your question, and best wishes to you both.

 

Views and opinions expressed in this program are provided for informational purposes only and are subject to change. This discussion is not tax, legal, estate planning or USAA product advice and is unique to the member only. The law concerning tax and retirement plans is complex, penalties are severe, and the laws of your state may differ. Consult with your tax, legal or estate planning professional regarding your specific situation.

 

This material is for informational purposes. Consider your own financial circumstances carefully before making a decision and consult with your tax, legal or estate planning professional.

 

Certified Financial Planner Board of Standards, Inc. owns the certification marks CFP® and CERTIFIED FINANCIAL PLANNER™ in the United States, which it awards to individuals who successfully complete CFP Board's initial and ongoing certification requirements.

 

Financial planning services and financial advice provided by USAA Financial Planning Services Insurance Agency, Inc. (known as USAA Financial Insurance Agency in California, License # 0E36312), a registered investment adviser and insurance agency and its wholly owned subsidiary, USAA Financial Advisors, Inc., a registered broker dealer.

 

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