PERSONAL FINANCE
When it comes to love and money, tying the financial knot involves adjustments and compromises. By understanding expectations, setting common goals, and mapping your journey as a couple, you can build a healthy financial foundation for the future, together.
People are waiting longer than ever before to get married. The median age for women is 28 and 30 for men compared to 20 and 23 in the 1960s.1
In 2018, a record of 35% (39 million) of Americans ages 25 to 50 had never been married.2
58% of couples surveyed are cutting their guest count by an average of 41%. 3
46% of
couples
are
cutting their budget by
an
average
of 31%.4
Smaller weddings could likely translate into extra savings for other priorities and milestones, such as:
the purchase of a new home
starting a family
paying off student loans
One fourth of today’s young adults are forecasted to give up on the institution of marriage altogether by the time they reach their mid-40s to mid-50s.5
2 out of 3 Millennials between the ages of 18 to 29 agree with the sentiment that society is just as well off if people have priorities other than marriage and children, as did 53% of those between the ages of 30 and 49.6
If one spouse is making significantly more than the other, you may qualify for a lower tax bracket when filing jointly as opposed to the higher-earner’s single bracket.
When it comes to health insurance, it can be more economical to add an extra person to a policy than to pay for separate health insurance plans. This is particularly useful if one spouse is self-employed.
As U.S. citizens, you can make tax-free gifts of any amount to your spouse rather than paying gift taxes in the event one of you is supporting the other financially.
You can contribute to a spousal IRA. If one of you is not working, the working spouse can generally contribute to the non-working spouse’s IRA.
Should you combine your bank accounts or keep finances separate? Here are the pros and cons of both scenarios:
If you choose to skip the "big day" altogether, ask your Financial Advisor about the financial benefits of a Domestic Partner Agreement or Cohabitation Agreement.
Start by asking your partner about any debt, secondary income sources, expected inheritance, or properties you should know about. Communicating early and often will help you both become more comfortable with the topic and avoid unpleasant surprises in the future.
Timing is everything when it comes to discussing the money and it helps to plan ahead so no one is blindsided. Get in the habit of scheduling regular meetings to discuss your finances and address any concerns or questions that may come up throughout the year.
Everyone approaches his or her finances differently. Some people are savers, others are spenders, and some people prefer to avoid the topic altogether.
To avoid the negative connotation of having to “ask for permission” to spend money from a joint account, agree that any purchases above a set limit must be discussed and agreed upon together.
It’s important to be working toward common goals. Establish how much you are each going to contribute toward your goal every month and stick to it.
Make sure to organize all financial documentation, including both individual and joint paperwork, in a central place.
This infographic is inspired by Morgan Stanley’s series "The Playbook: Your Guide to Life and Money".
Pew Research, Record Share of Americans Have Never Married, 2014,
Institute for Family Studies analysis, using U.S. Census Data, 2018.
The Wedding Report, 2020 Covid-19 Wedding Market Impact, 2020,
Prudential Financial, "The LGBT Financial Experience, 2016–2017," 2017,
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