Marriage is a Contract, Not Just Love
The Evolution of Marriage
If you go back a century or so, you’ll see how different marriage was than it is today. Recall the dowry? A dowry was the gift of money or property a woman had to bring to her husband in marriage. Marriage was a business arrangement, and the dowry was reflected the "worth" of his bride, though she was technically not a person, but property. The definition of marriage changes as time goes by, and there is little that objectively defines the word. Throughout the 20th century, people began marrying for love. It might sound romantic, but side effects included higher divorce rates that only climbed as time went on and now are over 50%. People are getting wise to the potential deceptions of love and once again turning to the idea of a marriage being a business transaction.
Marriage is a Business
It may not sound romantic, but marriage is a business. There are a few things to be aware of these days when it comes to nuptials:
- How does each spouse feel about saving?
- How does each spouse feel about spending?
- Is there to be a joint account, or separate accounts?
- Is there to be a house account along with separate accounts?
- Should charitable donations be made and if so, how much?
- How much should be put into retirement?
- How much should go into a college fund?
- How much should you put in the emergency fund? When should it be tapped into?
These are some of the questions that every couple about to marry must discuss. There must be consistency in the answers, even if they don't match. Could you live wiht someone who wants to save 12 percent of total income, if you want to save only 10 percent? Probably. But if your spouse is accustomed to only saving three percent, you may have a problem.
The Prenuptial Agreement
Should you get a prenup or not? Obviously, this isn't the most "romantic" subject, but if you look at marriage as a business as it does involve it, it's a necessary issue to cover. Today, the trend is for couples to wait to marry until they're older. This shows that a general sense, there are more assets between each to distribute if the marriage dissolves. Have a plan in place before problems arise is the best idea for people in general, and doubly so for couples. Remember to stay calm, and have discussions that are rational and fair, as couples that broke up usually don't. Emotions fuel difficulties.
Preparing Your Financial Marriage Agreement
To prepare a financial marriage agreement, look at the following list:
- Find out your financial starting point as a couple. Though it can get painful, get your credit reports and discuss them. Figure out a strategy to fix problems, and pay off debt.
- Create a savings plan to reach financial goals. For instance, a couple wants to buy a starter home in three years – they must figure out how much to save as of NOW. A good financial calculator can estimate how much needs to be put away into savings.
- Figure out who is going to be in charge of the day to day. Every marriage has one person who oversees monthly finances and usually cuts the checks. Obviously, major decisions must be made together, but there's no reason for both people to pay the utilities together.
- Learn to work out conflicts with finances. Inevitably there will be issues that arise that create differing opinions. Commit to listening, and also to compromise on money issues.
A marriage does blend the finances of two people. Knowing what the strategy is to move into the future is an important one. Couples should sit down and have a good talk about their goals, and figure out how to reach them together.
