Getting married when you’re older—when you may have an established career, more assets, and possibly kids—requires different financial considerations. Here are a few to discuss together.
Getting married later in life comes with unique financial considerations. You already have the fancy mixer and guest towels. But you may also own a home. Or may have a (bigger) savings account. Maybe credit card debt. Maybe kids.
Here are three important conversations to have with your partner when marrying at an older age, when you’re more established, or when you’ve been married before.
1. Talk about how to handle finances when married.
Discuss whether you’ll commingle your funds. Older couples who’ve been managing their finances individually may find it’s an adjustment to share.
“You’re not just merging your money but also your lifestyles,” says Heather Winston, financial professional and product director for retirement income solutions at Principal®. “Think about how you’ve been managing your money separately. Then talk about what you’ll do differently.”
- Combine money and pay bills from joint checking and savings accounts.
- Keep some accounts separate and open a joint account or two. You may have some bills you want to pay from your own accounts (think college funds for any kids) and others you’ll pay together (like a new mortgage).
- Continue to maintain separate accounts. Decide who will pay which bills and how you’ll save for goals separately and together.
Tip: Understand how marital assets are handled in your state. Every member of a joint account could have legal rights to the money. It also means if one person gets sued or fails to make debt payments, the money in a joint account could be at risk. Consult an attorney to understand the legal implications.
Tip: If you maintain separate accounts, consider how you’d access the money in case of an emergency or if someone was incapacitated
2. Decide how to handle assets and debts.
Set a time to talk numbers, laying all your cards on the table. This is about setting priorities, not airing dirty laundry. Share what you each bring to the marriage, prioritize what matters most to you as a couple, and then build a budget based on that.
Some conversation items:
- Assets. Bank accounts, investments, real estate, or retirement savings (like a 401(k) and IRAs).
- Income. Paychecks, rental property, or other sources of income.
- Debt. Cars, credit cards, mortgages, student loans (for you or any kids), or personal loans. If you’re planning on making some big purchases together (a vacation home, a new car, etc.), consider sharing your credit scores, as well.
- Child support, alimony. If it applies to you.
Tip: You may want to spell it all out in a prenup, an agreement meant to ensure your wishes are clear in case of divorce (who’s entitled to property and who’s responsible for debt). Consult an attorney to understand the legal implications.
3. Figure out what else you need financially.
When you have a feel for your cash flow as a couple, work through the remaining aspects of your overall financial plan.
Some topics to consider:
- Health and dental insurance. Getting married is considered a benefit event at work, meaning you can make changes outside of the normal election period. If you each have coverage available, consider whose is a better fit for your joint needs.
- Life and disability insurance. Do you have adequate coverage? If you’re not sure how much you need, use one of our calculators. And update your beneficiaries while you’re at it.
- Long-term care insurance. Once you marry, you’re responsible for your spouse’s medical debts. Medicare doesn’t cover most nursing home care, and a married couple’s combined assets are counted when determining eligibility for Medicaid.
“If you’re over 50 and haven’t invested in long-term care insurance, there's no time like the present to get started,” Winston says. “Generally, you should try to keep the total cost of coverage around 7–8% of your monthly expenses.”
- Retirement plans. Is this a good time to increase participation in your 401(k), contribute to IRAs, or make catch-up contributions? Update your beneficiaries, too.
- Will/estate planning and trusts. Create or update your will, power of attorney for health care and for finances, and a health care directive (“living will”). Some people also create a living trust. Trusts can get complicated, especially if either of you have children, so enlist the help of a good estate planning attorney.
- Taxes. Being newly married may bring tax benefits, but it could also result in higher taxes. Talk to your tax advisor about the implications and if it’s better to file individually or jointly. The name on your income tax returns should match the name you’ve registered with the Social Security Administration.
If you or your partner have been married before:
- Pension/retirement benefits and rules for former spouses. Generally, pension benefits earned during marriage are considered joint assets, but how the assets are divided and whether the survivor benefit is payable is up to your state’s divorce court. Review any Qualified Domestic Relations Orders before remarrying.
- Social Security. Understand ex-spouse benefits and how they affect you.
- Divorce decree provisions. Review any provisions regarding alimony and remarriage, life insurance, child support, and additional provisions for any kids from prior relationships. Do clauses need to be reevaluated now that you’re remarrying?
And if you have children:
- Financial aid for children’s education. A new spouse’s income may be considered in college financial aid applications. Some people postpone marriage because of that, especially if they have a big salary discrepancy. (Though a large, blended family could work in your favor if the kids are in college at the same time.)
“Money discussions aren’t always easy. But they’re important to building a future, together,” Winston says. “Before you say ‘I do,’ invest the time to ensure you’re both set up for success in your new union.”