When you’re getting married, the last thing you want to think about is money.
There’s nothing particularly romantic about balancing a checkbook (although, to be fair, we suppose that might depend on your check designs). Why not just sit back and enjoy the first few weeks of marriage without worrying about your bank balance? Besides, you’ve already set up the joint bank account, you’re paying all of your bills on time, and you’ve got a pretty good idea of how money works.
Unless you’re a financial expert marrying a relationship guru, however, you’re probably operating on some misconceptions. That’s a recipe for disaster, so we’re here to shed some light.
We spoke with Emilie R. Goldman, CFA, CFP, of Tamarind Financial Planning to learn the truths behind some of the money myths of marriage.
Myth #1: You can keep full control of your own money after you’re married.
“People don’t want to give up their financial autonomy,” Goldman says. “Especially when I see people who are married for the first time, they have that as a high priority. You can’t keep money out of the relationship once people are married and [they] begin to have joint goals.”
Every couple is different, but when you’re operating as a single household, teamwork is crucial. You can’t simply go out and buy that new PlayStation you’ve had your eye on without consulting your spouse first—and yes, that’s even true if you’re earning significantly more than your partner.
According to a study published by North Carolina State University, 39 percent of surveyed couples listed finances as a primary source of conflict, and 54 percent listed finances as a secondary conflict. Goldman says that stress often comes from a lack of communication, which often occurs when one or both partners think of funds as “my money.”
“There’s an adjustment period of figuring that out,” she explains. “Keeping some amount of money under your control is certainly a good thing and can give you some feeling of autonomy, but you’ve got to accept that you’re now working together, to an extent.”
Even if you’ve lived with your partner, accept that your financial freedom is going to change significantly once the marriage begins. If you can learn to compromise right out of the gate, you’ll have a much easier time.
Myth #2: Prenups are only for selfish people who don’t believe in love.
To many couples, prenuptial agreements seem horribly cynical. Only 5 to 10 percent of married U.S. couples get prenups, and there’s certainly a stigma surrounding those contracts. Why would you plan for your marriage to fail?
Practically, there’s an obvious reason: 40 to 50 percent of U.S. marriages end in divorce, according to the American Psychological Association. If your finances are fairly complex, a prenuptial agreement could help you handle a divorce relatively easily while ensuring that both partners get a fair shake (and yes, we realize that doesn’t sound too romantic, but trust us, we’re getting to something more positive).
The good news is that a prenuptial agreement—or a postnuptial agreement, if you’re reading this after your big day—can also remove financial stress, potentially improving the chances of a successful marriage.
“When [the pre-nup] is very clear and transparent, and everyone knows what they’re obligated to do, they don’t have any sort of fear underlying their behaviors,” Goldman says.
In other words, hammering out a agreement for the worst-case scenario might prevent some of the misunderstandings and financial mishaps that put pressure on a relationship. Remember, communication is key; a prenup might help both partners get on the same page right from the start.
Of course, if you don’t love the idea of a prenup, that’s okay, too.
“Every couple is different,” Goldberg says. “What works for one couple might not work for another.”
Myth #3: You can expect your tax bill to change dramatically after you’ve married.
To be clear, you shouldn’t take tax advice from a website, even if that website has an insanely funny, smart, and physically fit editorial staff. We don’t know your tax situation, and neither does Goldman.
With that said, if you’re thinking that your marriage might be a financial bonanza, you might want to think again. Tax benefits for married couples have shrunk since 2001, and more changes are on the horizon.
“For a typical couple, [the tax effects of marriage] could have gone either way under the old tax system,” Goldman says. “It could have a benefit or a cost. Most of that went away with the new tax law coming in this year. Only people with very high income will experience a tax penalty—couples making over $600,000.”
Goldman says that most couples probably won’t see significant changes in their tax liability after getting married, provided that both partners are working. Children complicate things (don’t they always?), but under the new tax plan, single parents making up to $75,000 each or $150,000 combined can also take advantage of the child care tax credit, per USA Today.
Again, though, tax law is incredibly complex, particularly at the state level. Goldman notes that the safest course of action is to speak with an accountant as soon as you’ve decided to tie the knot.
Myth #4: When you get married, you take on your partner’s debt.
This depends on the laws in your state, but generally speaking, if you haven’t signed any documents claiming responsibility for your spouse’s debt, you won’t be responsible for that debt in the event of a divorce.
“Whatever you bring with you into the marriage, that’s still yours,” Goldman says. “That’s the simplified version.”
My girlfriend: “We can’t get married until you pay off your student debt.”
Me: “You could just say we’re never getting married.”
— 🍋 (@Brianne_esque) April 22, 2018
Generally, you’re not going to take on half of your spouse’s credit card debt or a hefty percentage of their student loans as soon as you’ve tied the knot. With that said, if your partner has a tremendous amount of debt, Goldman recommends speaking with a financial advisor.
“That might be a situation where you’d want to consider a prenup or postnup,” Goldman says. “You don’t want to leave any questions regarding who’s responsible for what.”
There are a few things to keep in mind if you’re entering into this type of marriage. If your partner has sizable debts, you might want to rethink opening a shared bank account, since in many cases, debt collectors can be awarded access to funds from those shared accounts.
You should also note how your state handles new debts; Goldman says that in most common-law states, debts incurred by one spouse typically belong to that spouse alone, while in community property states, those debts belong to both partners. Of course, actual state laws can be considerably more complex.
Still, the important takeaway is that you don’t have to put off your marriage simply because your partner has a bad financial history—you just have to do some extra homework to understand your potential liabilities.
Myth #5: Your partner feels the same way about money as you do.
To some people, money symbolizes independence; to others, it’s more closely associated with security. You might think of $10,000 in savings as a relatively large amount of money, while your partner might start panicking when their account dips beneath $20,000. Don’t ignore those differences: Before you start splitting bills and sharing income, you need to have some honest (and potentially difficult) conversations.
“The first thing I tell couples is that money is just money,” Goldman says. “People see it as security, or power, or any of these other things that money represents, and that might be in conflict with what our partner sees. Start out by acknowledging that it’s just money.”
The easiest way to change your perspective is to start asking questions. Think about your own relationship with money, and you’ll be able to communicate more effectively with your partner.
“When couples come in, I ask, ‘What’s the purpose of your money?” Goldman says. “What are some of the things you learned about money growing up? That starts the conversation.”
“From there, we can discuss things like budgets, cash flow—getting a really clear picture of what their lifestyle will be like, what each person will contribute, what they can expect to spend, and things like that. But first, they’ve got to share their perspectives on what money really means, and they’re probably not going to have the same perspective.”
This is where that whole “communication” thing becomes absolutely vital.
“People often have very different views on money,” says Heidi McBain, LPC, a licensed marriage counselor in Texas. “Yes, some people are savers and some are spenders, but it goes deeper than that. It’s really about security. … The earlier a couple can start talking about money openly and honestly, the better.”
McBain recommends setting aside some time every week to talk about money issues without distractions. While that might seem unsavory at first, it’s a good way to head off misunderstandings.
“If money is a huge stressor in the relationship, therapy can be a helpful, safe place to talk about these issues and learn new, healthy ways to communicate about money,” she says.