On June 12th, Rob Hart and Kris Kridel featured me as a guest on WBBM Newsradio Noon Business Hour. We discussed money matters before marriage. As with all life transitions, it is essential for couples to be organized and to communicate openly and honestly about their finances. Check out the full transcript and audio below. My segment begins at 19:30.
Rob Hart: Finances should be part of this discussion as couples advance in their relationships, particularly marriage. Let’s talk about some of the key points with Nancy Doyle who is the author of the book Manage Your Financial Life based in Glencoe. Nancy, welcome to the program. When two people start talking about getting married, maybe they’re moving in together, maybe they already have moved in together, at one point does one participant or the other make their finances totally transparent? Or do some people just lie about their money all the way up to the point to they get married and maybe after that?
Nancy Doyle: Well, I certainly don’t recommend the latter and I think addressing finances is important before you make a life transition. And I think two important words to keep in mind are communication and organization. When you’re going through a transition, getting married, moving in together, you need to take a comprehensive objective view of your finances and you do need to work together with your partner and be on the same page.
Rob Hart: And that really avoids potential pitfalls in the future where if you keep your finances a secret of all a sudden, a bad credit score keeps you from getting a mortgage or perhaps excessive credit card debt could get you in trouble as you try to manage some aspect of your married life.
Nancy Doyle: Absolutely. And I think communication is the first word I sighted and I think it’s important for couples to talk about the big picture and also little things. For example, what percentage of your income do you plan to save going into the marriage? You may have very different ideas about how much saving is necessary. Also, a lot of couples talk about how much money one or the other can spend without consulting with the other first and talk through what makes you comfortable.
Kris Kridel: I would think that marriage itself is forcing some of these conversations. We’re in an era where we’re seeing these huge weddings and destination weddings and that’s some very expensive for the start of your life together.
Nancy Doyle: I agree. I agree. And I think that starting your married life together with large credit card bills is just not the way to start and I often say, “You don’t have to furnish your home all at once. You don’t need to start with a huge bill from your wedding. It’s just not the way to begin your life together.” And I think another point that is important to consider is, people often ask me, “Should we combine all our finances?” And I don’t necessarily believe that’s true. I think it’s important before you get married especially to sit down and make a list of all of your accounts, your assets, and your debt, kind of put it all out in your table, discuss it openly and honestly. So you start to work together and be on the same team because behavioral finance studies show that if people work together, they will be more successful in achieving their financial goal.
Kris Kridel: Nancy, thanks for joining us today. Nancy Doyle is the author of the book Manage Your Financial Life and her website is ManageYourFinancialLife.com and she’s from Glencoe, a suburb of Chicago.
