Tips for newlyweds to talk about money

(ARA) - If you haven't yet butted heads with your mate over money, chances are you will one day. No matter how compatible a couple is or how much they adore each other, money and how to manage it can still be a source of conflict - even in the best of marriages.

Before you walk down the aisle, having a conversation about finances and credit can help ensure a future of wedded bliss, with minimal disagreements over money. Transparency over finances builds trust in a relationship. It can also help you establish your mutual monetary goals, whether you want to buy your first house together, start a family or send one of you back to school.

Any pre-nuptial money talk should start out with credit and debt - specifically how much debt each of you has (student loans, car loan, credit card, etc.), how you plan to pay it off, what your credit scores and reports look like, and how you will use credit to achieve your goals in the future. Enrolling in a credit monitoring membership can be a good way to start the dialogue. Web sites like freecreditscore.com make it easy to review your credit scores and reports online. You'll be able to share with each other a comprehensive overview of your current credit status and credit history.

While you'll each have your own credit score and report throughout your marriage, your credit - just like your lives - will be linked for better or for worse. Your combined credit history will affect what kind of interest rate you can get on mortgages, car loans and virtually any other kind of credit you'll need in the future.

Once you've talked about credit, cover these conversation points next:

* Saving and spending habits - Is one of you frugal to the point of being cheap? Is the other a habitual spender? Balance is important in any marriage, and hopefully your saving and spending habits can balance each other. While you should always save as much as possible, you also don't want to overly restrict yourselves so that you feel deprived or pressured. Ideally, you should save enough to cover several months of expenses and spend enough to cover your essential needs with a little left over for some fun.

* Retirement plans - It's never too early to start thinking about how you'll fare financially during retirement. Discuss any retirement accounts each of you already has. If neither has any retirement plan set up, consider consulting a financial planner to find out what type of plan might be best for your needs and goals.

* Spending styles - How will you fund big purchases, like new furniture or your honeymoon trip? Will you save until you can pay cash for big-ticket items, or will you use credit? Consider and discuss how you'll pay for bigger purchases.

* Taxes - Talk about when you'll file your taxes and consult with your accountant to see what filing status - such as married filing jointly, married filing separately or head-of-household - will benefit you the most.

* Marrying your money - Will you establish a joint account and deposit both your incomes there? Will you maintain separate accounts? Or perhaps you'll establish a household budget account and both contribute a portion of your monthly income.

* Budgeting - Create a household budget right away and decide how you'll manage expenses. Who will write the monthly checks (or handle the monthly online bill pay chores) to cover household expenses? Will you each pay personal expenses like car payments and student loan payments from separate accounts?

By discussing potentially conflict-causing monetary issues like credit use, credit scores, credit reports, spending and saving before you exchange vows, you can help ensure you start your married life together with a clear vision of how you'll use money to make your lives better.

Courtesy of ARAcontent