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. You remember the dowry? A dowry was a cash gift or gift of property a woman brought with her into her marriage – which is code for what she essentially was sold for by her parents. In essence the marriage was a financial exchange and the amount of the dowry told a man how much “value” his new bride had. 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?
- Will there be a house account in addition to separate accounts?
- Should charitable donations be made and if so, how much?
- How much should you put towards retirement?
- How much should be put into college funds?
- How much should be in the emergency fund? When should it be utilized?
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. If your spouse is accustomed to only saving three percent, there might be 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. Having a plan set in place before problems arise is the perfect idea for any couple. Remember to stay calm, and have discussions that are rational and fair, as couples that broke up usually don’t. Difficulties are only fueled by emotions.
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 any problems and pay off debts.
- Create a savings plan to reach financial goals. For example, if a couple wants to buy a starter home in three years, then they need to figure out how much to save starting now. A financial calculator can show you what you need to put away.
- Figure out who is going to be in charge of the day to day. In every marriage there is one person who pays bills and expenses and oversees the monthly bills. 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. Be committed to listening and compromising when it comes to money.
In the end, marriage is a financial blending of two entities. Knowing the strategy is to move into the future is important. All couples should sit down and have an honest discussion about what their goals are and then find ways to reach them together.
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