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When I Propose, I'll Have Some Financial Proposals, Too


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CF8NFB Man making a proposal of marriage opening ring box
Every one of us has had "aha! moments." Epiphanies. Days when we reach a crossroads and realize that we have to make some changes. For the next two months, we're sharing moments like those in our Life Stage Lessons series: Real stories straight from the financial lives of our DailyFinance contributors about times when they realized they were due for a serious course correction. So read on, learn from our mistakes, and get inspired to improve your relationship with your money.

I am not engaged to be married, but when the day comes, I intend to be ready -- financially speaking. Marriage brings with it all kinds of money challenges. On the one hand, it's great. You've got two potential wage-earners living under one roof, tax incentives, and a better motivation to save. But it also brings whatever financial problems each partner had before they got engaged, like debt and poor spending habits. Weddings and the first year you spend together are expensive. So I have a plan.

Engagements and Weddings Are Expensive

As a young couple, you'll have to spend money on so many real needs, it's a shame to blow a fortune on a ceremony and one big party, however beautiful. Save yourself some funds to spend on a house, furnishings, everything you'll need for your new life together. I'm not saying you have to have a small, sad wedding -- but spend $3,000, rather than $200,000. Don't drop $5,000 on an engagement ring. Have a modest honeymoon and put that money toward enjoying the first months of your life together more. Get creative. You can work together as a couple to make a beautiful and fun wedding. My friends have done it. You can, too.

Andy and Kara had a small wedding: 50 people. They rented a big beautiful house for way less than a normal wedding venue. The ceremony was in a lovely central gathering room, and there was plenty of space for all. They made their own decorations and a lot of the food, with help from their friends. The whole wedding party stayed at the house (there were many bedrooms), saving thousands on hotel accommodations. The event was one long party with all their favorite people in the world, and they saved a boatload of money.

Get on the Same Page Financially

A marriage means a bringing together of your finances. You may not always agree with the spending ideas that your partner has. What do you do? People do this a lot of different ways. Some people like to throw all their money into one big pot; others like to maintain independence. I recommend opening a joint checking account to handle your joint expenses, while keeping small side spending accounts for each partner. This way, your finances feel married. You have to make decisions together and hold each other accountable. But you are still able to make your own free choices with some of your money.

My friends Nate and Bethany got married when they were at different places in their financial lives. One had no debt; the other had ... a lot. At first, they clashed because the debt-free one didn't want to have joint spending. To establish trust, they made a model like the one I described above. Rather than one pointing fingers at the debt that the other brought into the relationship, they both took up the responsibility and knocked it out together.

Be Equally Involved in Financial Health

A lot of people recommend having one partner be the "money person" while the other lives in blissful ignorance. I don't think this is a great plan. Both partners should be engaged and excited about saving, investment, debt elimination and efficient spending. You'll generate so much more wealth this way than if one partner doesn't really feel a part of things. You'll also be working together. That's an important skill for married people to have, and it's nowhere more practical than in the finances.

I know a couple, Derrick and Christopher, who totally changed their lives when they got married. They sold their cars and bought bikes. They quit wasting money in a lot of areas and began putting away more than $2,000 a month. If all goes well, they plan to semi-retire in the not-too-distant future. This kind of cooperation is not possible for couples who aren't both involved in their shared finances. Make a plan. Work together.

Marriage is a chance to do more with your money than you could as a single person. Make the most of that opportunity.


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