CLEVELAND, Feb. 12, 2016 /PRNewswire/ -- The idea that
opposites attract might make for great wedding toasts and tales.
But when it comes to money management, newlyweds who share the same
approach to money are less likely to see their marriages end in
divorce.
In fact, research done in 2012 at Kansas
State University revealed that arguments about money –
regardless of couples' income, debts or net worth – is the most
significant predictor of divorce.
In honor of Valentine's Day,
KeyBank offers newlyweds the bank's best wishes for a long and
prosperous union and some suggested steps to help couples make
confident financial decisions:
To debt do us part, and other unromantic topics
Ideally, newlywed couples make time to talk through their
personal financial situations before wedding bells ring so
there's no post-ceremony reveal about each other's financial
situation.
At the very least, couples need to come clean about any
outstanding debt they bring to the marriage, and their specific
plans for paying down that debt. Failing that, however, newlyweds
should still make time post festivity to talk through
finances.
Yours, mine and ours
Marriage rate data highlights trends that are particularly
relevant for new couples' approach to personal finance:
- The percentage of couples delaying marriage is the highest it's
been in more than a century, according to a 2015 report by the US
Census Bureau.
- More women than men are marrying later in life, according to
data from the National Survey of Family Growth.
This means more couples are coming into married life with
separate incomes and equally independent attitudes about savings,
spending and investing.
It also means couples need to give themselves some time to think
through how they will manage money.
Rather than immediately co-mingling all assets, couples should
consider establishing a joint account for shared expenses (rent or
mortgage, property taxes, utilities, car payments) and separate
accounts for personal expenses.
Have a plan (or plans)
Once couples have settled on where they are moneywise,
they should focus on where they want to be moneywise.
Certainly most newlyweds became couples in part due to common goals
and values, such as wanting a certain lifestyle, planning to have
children or wanting to retire sooner rather than later.
Personal finance plans serve as roadmaps to get couples from start
to destination.
The planning process starts with setting a household budget
based on income adequate to cover expenses. Next is setting
short-term goals such as establishing an emergency fund or paying
off student loans and credit card debt, and deciding how to meet
those goals. The same process applies for long-term goals such as
paying for childcare (or managing expenses on one income), saving
for college and saving for retirement.
Money can't buy you love
Marriage is compromise, and that goes double for personal
finance. Getting money management differences on the table gives
couples an opportunity to develop an understanding and appreciation
of each other's approach to personal finance.
By acknowledging and understanding differences early on, couples
improve the odds they can avoid personal and painful conflicts over
money.
This material is presented for informational purposes only
and should not be construed as individual tax or financial advice.
Please consult with legal, tax and/or financial advisors. KeyBank
does not provide legal advice.
About KeyCorp
KeyCorp was organized more than 160 years ago and is
headquartered in Cleveland,
Ohio. One of the nation's largest bank-based financial
services companies, Key had assets of approximately $95
billion.
Key provides deposit, lending, cash management and investment
services to individuals and small and mid-sized businesses in 12
states under the name KeyBank National Association. Key also
provides a broad range of sophisticated corporate and investment
banking products, such as merger and acquisition advice, public and
private debt and equity, syndications and derivatives to middle
market companies in selected industries throughout the United States under the KeyBanc Capital
Markets trade name. For more information, visit
https://www.key.com/. KeyBank is Member FDIC.
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SOURCE KeyCorp