The Financial Conversations to Have ASAP Now That You're Engaged

You asked. The Most Powerful Woman on Wall Street answered.
Roll of money in circle
Sallie Krawcheck the knot writer
by
Sallie Krawcheck
Sallie Krawcheck the knot writer
Sallie Krawcheck
CEO of Ellevest & The Knot Wellness Contributor
  • Sallie Krawcheck is the CEO and co-founder of Ellevest.
  • She has earned the title of "the Most Powerful Woman on Wall Street."
  • With about 40 years of experience in her discipline, her life’s mission is to help women to reach their financial and professional goals.
Updated Jul 26, 2022

The engagement period doesn't–and shouldn't–only include planning logistics for the wedding. If anything, it's an important time to have conversations about money and marriage. Finances are often a point of contention for married couples, especially those who don't communicate about spending, expenses, debt and investments.

You know those couples who find money to be a weird and heavy topic? We have women who often email and say, "I want to talk to my husband or wife about money, but I don't want them to think I want to divorce them." The advice is to start talking. You might have a problem if he or she thinks a money conversation equates to divorce. In those cases, you're turning money into this source of power and scarcity. When one partner controls the money, it's scarce. But when you share it, it's an abundant commodity.

True financial wellness between couples begins with grasping the basics of money management and discussing everything from your income to credit scores.

In This Article:

The Financial Questions to Ask Before Marriage–Answered

How Should We Merge Assets?

There's no one right way to combine your finances. Some people merge everything into a shared account and some use a designated joint account to pay bills. They then split expenses according to their proportion of the household income. Others choose to keep everything separate.

Who Should Manage The Money?

Research shows that 74% of women who outsource the management of their money to their partners will have a negative surprise when that money comes back to them (often after a divorce or death). Both parties should be involved, stay informed and communicate regularly.

How Does Debt Work?

The laws are different in every state, but usually, the debt you took on before you married stays your personal responsibility. Debt you take on after you get married becomes your joint responsibility. This is all the more reason to stay involved in your joint finances—to avoid any negative surprises.

It's vital you broach the topic of debt when you're engaged. Asking about student loan debt or other types of outstanding loans will help you assess your financial picture. You should never walk down the aisle with anyone if you don't know about their student loan debt, especially because that stuff is forever.

Will Credit Scores Come Into Play In My Relationship?

It's important to be transparent about each of your finances. Your credit scores are a big part of that, but they don't have to be a deal breaker. If you or your partner have a low score, what's important is whether you make an effort to fix it. It's also worth noting that in the event of a divorce, a woman's credit score typically falls more than a man's.

Do I Need A Prenup?

I can't tell you exactly what you should do, because I'm not a lawyer (and I'm also not you). But prenups—or postnups—can be a great and healthy beginning. They're really just a thorough look at what might happen in your financial future. Prenups aren't just for self-preservation; they're particularly useful if one of you owns a business or has children from a previous relationship.

What Should I Be Aware Of Regarding Taxes After Marriage?

Taxes can shift in quite a few ways when you get married, from your filing status and workplace benefits to adjusting the name on your social security card. I encourage you to consult a tax pro together before the big day, just so you both know what to expect.

Why Does Money Cause Friction In Relationships?

We all manage money differently and so much of that comes from our childhoods and past experiences. There's a lot of emotional baggage with money. Being in financial sync with your partner makes it easier to make decisions and respect and support one another's goals. You want to trust one another to protect your joint future.

How Do You Avoid Negative Financial Surprises In Marriage?

It feels uncomfortable at first, but at the end of the day, what could be more intimate than unpacking that emotional money baggage together? A statistic worth remembering: Some 78 percent of couples who talk about money every week report being happy, while only 50 percent of couples who talk about it very infrequently say the same.

Important Money Topics to Cover Before Marriage

Money in the shape of a conversation bubble
Getty Images

Along with the aforementioned questions to ask about finances before marriage, active money management means doing a deep dive into your values, psychology and future goals. The following topics are well-recommended for couples to unpack together during the engagement.

The Gender Pay Gap and Expenses

One topic that always comes up at Ellevest is the gender pay gap and how that comes back to your relationship. There's no perfect way to divide costs, but you can find a middle ground–of sorts. What my husband and I decided was he pay for our daughter's education and expenses, while I take on our son's education and beyond. While his education ended up costing more, we split what felt fair to both of us.

Joint or Separate Accounts

My husband and I keep everything separate. We don't have a joint checking or joint investment account. I don't have a strong perspective on whether one is recommended over the other, so as long as you're having the conversation. You have to come together around money. Before you get married, dig deep when it comes to money.

Your Values

Our values influence the way we see the world–and, in turn, perhaps spend our money. It's important for you to ask your fiance(e): what values are important to you? For example: Is it important that you personally give a certain amount to a nonprofit every year? Is it important to your partner that you both invest in companies that don't harm the environment? Have these conversations to refer to your inherent values and how that ties back to spending.

Vacations and Retirement

Not every couple will agree on how they spend valuable time off or their longterm retirement plans. Ask questions like: "Do you like a big vacation once a year or are you more frugal?"

When you plan to retire, you'll also want to determine a possible move or community where you'd like to settle. It's important to ask questions like, "Do you see us in Italy or Costa Rica, or NYC?" Conversations around money don't always have to be dollars and cents. They start with joint dreams, aspirations and values, and can work their way into dollars and cents.

Finally, the more couples talk about money, the happier they are. Something like 76% of couples who talk about money once a week report they're happy to very happy.

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