This is part two of my basic guide for newlyweds or engaged couples. If you haven't already read part one, do that now. Don't worry. I can wait.
Now that you have talked about your financial ancestors, next you will need to talk about the specifics of your finances. I think I heard some gasping. Get over it. Sooner or later your fiance or spouse is going to find out about your money situation and it might as well be now. If you don't trust your partner with this information, maybe you should think a little harder about whether you should be getting married to them.
First, you will need to do the following things before your second financial date. Make a list of every account that you have- checking, savings, brokerage, insurance, credit card, loans, retirement, and mortgage. Bring the latest bill or statement from each of these and information on your insurance coverage. Also make a list of all of the titles that you have- car, house, boat, trailer, motorcycle, etc. and bring that to the date as well. ***New*** I have added a special spreadsheet that you can use to make this step easier. Click here to download it.
For the actual date I suggest making the first part of this date as fun as possible. Plan to stay at either your place or their place for the afternoon. You will have a lot of financial documents out and about and you don't want to lose any. The best time for most people would be a Saturday lunch because you are both really awake and relaxed and that leaves you with plenty of time to get everything done.
Have fun making lunch together. It doesn't have to be something overly fancy or it can be if you are into that. If you both don't enjoy cooking, then get some take out. The key is to get in a place where both of you are relaxed. Make sure both of you have eaten and are well rested. I have worked with adults and preschoolers, and I can tell you that adults like to think they've evolved a lot past their three year old counterparts and don't have such bad reactions to lack of sleep or food, however they are fooling themselves. Most arguments happen when at least one party is low on sleep or is hungry. It is best to make sure both of those needs are satisfied before moving on.
After eating bring out your papers. Take a big breath. Tell yourselves you can do this. Maybe bring out cookies to reward yourselves with as you finish each step.
Step 1: Merge ahead! Create a combined list of all accounts for both of you- banking, brokerage, insurance, credit card, loans, mortgages, etc.
Step 2: Twinsies! Do you both have a Discover card account for example? When you are married do you just want to have one? There are very differing opinions on combining finances when married. I honestly can't imagine keeping separate accounts when you're married. That would be way to confusing and much easier to hide things from each other. However, I have heard there are happily married couples that keep their finances split. I would challenge you to ask yourselves why you are keeping your accounts split though. We have never regretted combining ours.
Circle all duplicate accounts and determine whether you will leave them separate or combine them. When you combine you will actually be closing one account and adding a name on the other account. Make sure to start to make a to do list for each person. List the account, whether or not it needs to be closed, or whether they need to call and add the other person's name.
Next, determine if you want to close an account that isn't a complete duplicate, but is in the same category as something else. For instance, you may have checking accounts that are at different banks. Go through the same process as above.
Although merging accounts is a huge pain, I like to think of it as getting a series of shots. The nurses try and do it as quickly as possible to get it over with. If you go over all of this merging at once, you'll find that you can get this icky stuff over with and can move on to more fun things in your lives.
Step 3: Falling in love. Look at insurance policies. First look at auto/home/boat/etc. There is a lot of information on your policy that you should have brought with you. If you have an insurance agent I suggest calling them and giving them information on both of your insurance situations (maybe you have a house and a car and your fiance has a renters policy and a truck) and have them give you a quote on combining all of your insurance needs. You might find that it comes out much cheaper than the two policies alone. If you don't have an agent look online. There are lots of websites that will give you quotes online.
You will also need to look at health insurance policies. You can get information on your policies normally from the HR department at your work. You might want to compare and determine whose policy you want to use. Almost always a "family" policy is much cheaper than two individual policies. If you both are not insured I can not push enough that you need at least what I call "in case you chop your leg off" insurance. My husband does not receive insurance through his work so when we were first married we had a very high deductible insurance that we paid for on our own because I was just student teaching. We had saved enough that in case of emergency we could pay $10,000 and then the insurance would kick in. The likelihood of needing the insurance was small, but now that healthcare costs are rising so much, it would have just taken one trip to the ER and we could have eaten through that deductible in a hurry. We figured out how to do individual plans and now it is even easier. Go to ehealthinsurance.com and request a quote to get started on your journey to responsible health insurance adulthoodland.
Once you have decided whose plans you are going to use, make sure to add the other person on to the policy. Add this to your to do list.
Step 4: Mrs. ?. Obviously, if you choose not to change your name you can skip this step. For the traditionalists read on. This was a huge pain in the butt when I got married, so brace yourself. I am cheering for you. You can do it. Make a list of all of the accounts you are going to keep that have your current name. This is another good reason to nuke a few of your duplicate accounts. After you get your name changed you are going to need to contact all of those accounts and fill out the necessary paperwork. I will warn you that when I did this for my brokerage it was a huge pain. Be prepared to have to get things notarized. Not all of the accounts were that bad though. You will want to start looking into getting checks with both of your names.
Small note- you might not want to add your name on accounts before you get your name changed unless you absolutely have to. This will give you one less account to change the name on.
Step 5: Titles- aren't just for books. Make a combined list of all of the assets that you own that have titles. Consider adding the other person's name on that title. If you choose to add a name, make sure to add it to you to do list.
Step 6: Until death do you part. When you die (don't say if- it's going to happen) your money and assets have to go somewhere. If you are like many people you never filled out the beneficiary information for your accounts. Now is a good time to add your significant other to your beneficiary information.
Step 7: Mints keep us fresh! I cannot promote any website more than mint.com for any couple. This is a free way to keep track of all of your accounts in one place. You'll start noticing where you spend money, what accounts you are using and what accounts you might want to close.
Step 8: Double the fun! Double check each of your lists. Your list should include accounts that you need to close, accounts that you need to add names to, accounts that you need to change names on, and accounts that you need to add beneficiaries to.
As you draw your financial date to a close I only have a bit more advice. Remember that not only your assets, but also your debts are shared. Be careful not to resent your partner for their debts. Hopefully you consider their companionship as worth more than money.
Good luck on your second financial date!