It's that time of year again ... wedding season! According to the Association of Bridal Consultants, nearly 22 percent of couples tie the knot in July and August. But after the rice is thrown and the cake is gone, couples are left to deal with one of the biggest causes of martial discord: Managing their finances. Here are some tips to help you keep the peace:
-- Talk before you walk. Waiting to discuss your finances until after you've made the trip down the aisle can be a big mistake -- yet it's one many couples make. "If you look at the statistics, 47 percent of couples do not discuss money before marriage. That's nearly half," says Dr. Bonnie Eaker Weil, author of "Financial Infidelity: Seven Steps to Conquering the #1 Relationship Wrecker." Sit down together and agree that you're going to disclose everything about your financial lives, both good and bad. That means 'fessing up about student loans, credit card and other debt, as well as any major flubs in your past that could affect your partner. When you get married, your credit stays separate, but that doesn't mean your black marks won't come up when you want to, say, purchase a home or a new car together. It's better to get them out in the open now so you can figure out how to tackle them together.
-- Understand your differences. It's not reasonable to assume that just because you tie the knot you all of a sudden become the same person. What you have to do, therefore, is understand HOW you are different, how those differences are going to worry or stress your partner, and make sure to keep lines of communications open so that you both understand what is happening with the family pie. Take some time to explain the way you deal with money, which also means talking about how money was handled in your family when you were growing up, says Eaker Weil. Cover these basics as well: Are you a spender or a saver? What financial goals are important to you? And how do you plan to meet them? "Talk about how the two of you see handling your finances, and what you'd like to save for, but also what you'd like to spend money on," says Dr. Robi Ludwig, a Manhattan psychotherapist and my colleague on the "Today" show. If your priorities aren't in line, it's time to start making compromises.
-- Joint or separate accounts? Try both. There is a school of thought that says the more you merge your money, the more you trust each other and the marriage. I don't completely agree -- I am a big fan of having both joint and separate accounts. The way this method works best is if you come up with a household budget that the joint account will cover. It must include the amount you want to save for your joint goals (vacation, house, retirement, emergencies). Then figure out what percentage of both salaries will cover it, transfer that much in from each of your separate accounts, and leave the rest. But note: The bills covered by the joint account shouldn't always be paid by the same person. One of you will likely gravitate toward this task, but make sure you switch it up at least once a year, or do the work together. "Even if you don't like handling the money and your partner does, it's wise to be as knowledgeable as you can. It may not come naturally to you, but you need to know at least the fundamentals," says Ludwig.
-- Financial autonomy is a must. When it comes to marriage, you need to be able to buy a cup of coffee without checking with the spouse. If you don't have this financial independence, one spouse starts feeling like a parent and the other like a child. That said, it helps to set a limit for how much you can spend without consulting your partner. Maybe $100 at the mall is OK, but a new television isn't. Your threshold is going to vary based on what you can afford, but the point is that you agree to always discuss purchases that are significant.
-- Schedule financial dates. Once a week, make time to talk about money. It should be a time when neither of you is overly tired or cranky. (Perhaps after a television show you always watch together.) During the week keep a list of items you want to make sure not to forget, then discuss them. This is when you'll talk about how much to put in the FSA, whether you should switch healthcare plans, if you're paying too much for cable, if you need to re-allocate your 401(k), or whether you want a new flat-screen. Go into the conversation with an open mind -- if you're feeling nervous, worried or angry over money, try to understand what is behind your own feelings before you air them with your spouse. If you can understand why you feel a certain way, you and your spouse will have a greater likelihood of reaching an understanding.