Older and tying the knot? 3 things to talk about first

Photo of a couple who got married later in life and had a lot of financial decisions to consider.

Getting married is different when you’re older. You already have the dishes, pots and pans, and 6 sets of towels. But you may also own a home. Or have a (bigger) savings account. Maybe credit card debt.

Marrying later in life—when you have an established career, more assets, and maybe kids—requires different financial considerations.

Take it from Dana Downing, a software company executive in Erie, Colorado, who married at age 46 to her husband, a 44-year-old pastor and father of 2 teens. It was the second marriage for both.

They had a few differences in managing money. (He likes to write checks. She pays bills online.) Mostly, it was about how each had saved and spent their income.

“He was putting money away for college for his kids,” Downing says. “I was single most of my adult life and used to having disposable income to take vacations to places like Vietnam.” 

Before marrying, they met with his financial planner and combined investments. They made other decisions, too, such as building up their emergency fund and taking out life insurance on each other.

Whether you’re getting married for the first time at 39, or the second time at 52, or just moving in together, there are lots of financial decisions to make. Here are a few to consider together.

1. Talk about how you’ll manage money day-to-day.

Discuss whether you’ll comingle your funds. Older couples have had more time to manage their “own” money and may find it’s an adjustment to share.

“You’re not just merging your money, but also your lifestyles,” says Heather Winston, an assistant director and CFP® for Principal®. “Think about how you’ve been managing your money separately. Then talk about what you’ll do differently.”

You can:

  • combine money and pay bills from joint checking and savings accounts.
  • keep some accounts separate and open a joint account or 2. You may have some bills you want to pay from your own accounts (think college funds for your kids) but you want other bills paid “together” (like a new mortgage). 
  • continue to maintain separate accounts, and decide who will pay which bills, and how you’ll save for goals separately and together.

Downing and her husband opened a joint account to pay for their mortgage and home owner’s association fees but kept other accounts separate and split expenses. As for college, they decided loans were a no—that expense would be funded other ways.

Graphic of a thumbtack. 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.

2. Decide how to handle assets and debts.

Set a time to talk numbers, laying all your cards on the table. Share what you each bring to the marriage. Find what works for you—it doesn’t have to be a stiff convo in the home office.

“We learned the best way to have a serious conversation about money wasn’t sitting across the table staring at each other,” Downing says. “We get up at 5:30 a.m. and go for a walk and just talk about it.”

Some conversation items:

  • Assets. Bank accounts, investments, real estate, or retirement savings (like a 401(k) or IRAs).
  • Income. Paychecks, rental property, or other sources of income.
  • Debt. Cars, credit cards, mortgage, student loans for you (or your college kids), or personal loans. Share your credit scores, too.
  • Child support, alimony. If it applies to you.

Once you’ve sifted through what you have and what you owe, talk about a budget based on your newly merged financial goals. You may have new expenses.

“You may want to spell it all out in a pre-nuptial agreement,” Winston says. “Pre-nups have a negative connotation, but it’s not about What happens if we divorce? Rather, the agreement ensures your wishes are clear—to determine who’s entitled to property and who’s responsible for debt. It can help support your estate plan, too.”

3. Figure out what else you need (financially).

Good news: Getting married is considered a “benefit event” at work, meaning you can make changes to your employee benefits (usually within 60 days). You don’t have to wait for the annual benefit election.

Health insurance, plus dental, vision. Whose company has the better options for coverage? Look at what’s covered, what isn’t, the monthly premium deductibles, and co-pays. (To better understand health insurance costs, watch this webinar replay. Use passcode: Principal.)

Life insurance, disability insurance. Update your life insurance beneficiaries. Do you need more coverage now? Do you have adequate disability insurance coverage if you were injured or too ill to work? If you’re not sure how much you need, use one of our calculators.

Consider long term care (LTC) insurance, especially if you’re over 50. 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.

Retirement plans. Generally, it’s good to adjust what you’re doing as a couple to take advantage of an employer 401(k) match (at a minimum). Is this a good time to increase participation in your 401(k)? Contribute to IRAs? Make catch-up contributions? Update your beneficiaries, too.

Emergency fund.  Build it up, based on 3–6 months of living expenses.

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. Wills can get complicated, especially if either of you have children, so enlist the help of a good estate planning attorney. (Learn more about estate planning in this webinar. Use passcode: Principal.)

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.

Financial plan. Need help? A financial advisor can help you navigate combining your finances, providing expertise, and an objective view.

Conversation starters to talk money with your soulmate

  • How comfortable are you with debt?
  • What’s your risk tolerance with investments?
  • What financial (and life) goals do you have? Have they changed now that we’re together?
  • Are you a spender or a saver?
  • What financial decisions will we make together vs. what can we decide independently?
  • Do we want to work with a financial advisor to help us manage money toward the goals we have?
  • If one of us leaves the workforce or retires, how will we handle retirement savings and income? (Read 10 retirement questions to ask your spouse.)

If you or your partner have been married before …

Then check on a few situations that could apply to you.

  • 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 Order before remarrying.
  • Social Security: Understand ex-spouse benefits and how they affect you.
  • Review divorce decree provisions regarding alimony and remarriage, life insurance, child support, and additional provisions for kids from your prior marriage. Do clauses need to be reevaluated now that you’re remarrying?

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.)

“I’ve heard people say, I’m not paying all of the college tuition for someone else’s kid,” Winston says. “Your situation or personal feelings may be different. Talk and plan accordingly.”

Next steps

Reference of checklist is not an exhaustive list of what you should do. It and this communication are provided as education only with the understanding that Principal® is not rendering legal, accounting, investment advice, or tax advice. You should consult with appropriate counsel or other advisors on all matters pertaining to legal, tax, investment, or accounting obligations and requirements.

Disability insurance has limitations and exclusions. For costs and coverage details, contact your local Principal representative.

Long-term care insurance is not offered by any member company of the Principal Financial Group®.

Investment advisory products offered through Principal Advised Services, LLC. Principal Advised Services is a member of the Principal Financial Group®, Des Moines, IA 50392.

Insurance products from the Principal Financial Group® are issued by Principal National Life Insurance Company (except in New York), Principal Life Insurance Company and other companies available through the Preferred Product Network, Inc. Securities and advisory products offered through Principal Securities, Inc., 800-247-1737 , member SIPC. Principal National, Principal Life, Preferred Product Network, and Principal Securities are members of the Principal Financial Group®, Des Moines, IA 50392.