I DO....NOW WHAT DO WE DO?

Neal A. Deutsch, CFP^®

Published in Rivertown Journal, July 2008

I recently had the great pleasure of attending my niece Michelle's wedding. She looked quite beautiful, in full wedding regalia. During the ceremony, as her beloved Marshall waited for her at the altar, I began to think: pretty soon I'll get the phone call: "Uncle Neal- we're married. What do we have to do now?"

Regardless of age, a marriage is truly the beginning of a new life and lifestyle. Learning each other's habits, likes and dislikes, quirks and eccentricities are just a small piece of this new, wonderful time in your life. However, there are some responsibilities that come with wedlock or partnership, and must be attended to in order to keep peace in the family and be responsible members of society.

Assets- yours, mine or ours? Invariably, those entering a union will enter with stuff of their own. At this time, it is advisable to keep these assets separate. Investment accounts, retirement accounts, savings and personal assets should be kept for now in the name of the original owner. You may open a joint account to deposit all monies made after the wedding, but it is advisable (at least for now) to keep all pre-wedding assets separate and segregated from all that is earned during the marriage. The same goes for debt: each party should keep their debt separate, and be responsible for paying it off from their personal earnings.

Beneficiary designations - All life insurance, IRA's, 401(k) and other retirement accounts have a designated beneficiary. Now would be a good time to replace your Mom and Dad with your new spouse- this is probably the most overlooked financial task to be done. Put this on the top of your list- it can be a mess if not corrected in the case of an untimely catastrophe.

Life and disability insurance-  Now is the time to see that your new partner is protected in the unlikely case of a premature death or disability. It is important to consult a professional that is qualified to determine the correct amount of coverage for you to assure that your spouse will be able to continue to live in the manner that they have been accustomed to without having to make a radical lifestyle change. Picking an arbitrary amount is not sufficient- by the time you find out the coverage was insufficient, it will be too late.

Legal documents- Wills, living will, health care proxy and durable power of attorney are all necessary to protect your family and your assets. If you have previously drafted documents, be sure to review them after your union and either amend them with codicils or consult a qualified estate attorney for new documents. Remember- while your intentions may be loving, if it's not in writing, it won't pass to whom you intended. This is another item that must be put to the top of your list. While you are at it, don't forget to re-read my article last month about providing instructions for your loving pets as well.

Bills: Who's responsible for paying them? Talk about how you each handle the monthly payment of bills, and who will be responsible for sending out the checks each month. Be sure to define where the money comes from for each of the creditors. Lastly, make sure none fall through the cracks, which will affect your credit rating.

Name changes- In today's world, some brides take their husbands name and some retain their maiden name. Be sure to be consistent - take care of all legal documents i.e.: driver’s license, creditor accounts, Social Security, banking, etc.

Who's the spender and who's the saver? Identify your spending and saving habits. This can go a long way toward family unity! Talk about if you like to shop, or are meticulous about putting a specific amount away from each paycheck. There is no right or wrong here - we are all different in our money habits.

The way to a successful relationship is communication: share with each other your wants and needs- it will go a long way toward understanding each other financially. And last but not least... congratulations to Michelle and Marshall - honey, you looked beautiful!

Neal A. Deutsch is a Certified Financial Planner^™  & Registered Securities Principal, offering securities through First Allied Securities, Inc., member FINRA/SIPC.  Neal is President of Chestnut Investment Group in Suffern, NY, helping people with financial planning since 1984. Please feel free to call Neal at 845.369.0016 or email him with your questions at neald@chestnutinvestment.com. Visit his website at www.chestnutinvestment.com