Newlyweds

Still picking rice out of your hair?
Your new marriage means time to review and revise all of your planning:

Investments:

Marriage means combined
incomes, a different risk profile, and new planning objectives. As newlyweds review your overall financial goals and objectives and revise all of your investments accordingly.

Current Investments:

A newlyweds you may retain separate investment accounts to segregate gift or inherited assets: to
protect their immunity in the event the marriage doesn’t work out, as a result
of an express provision in your prenuptial agreement, or because one of you has greater malpractice risk. But even if you keep separate accounts, you your should coordinate overall investment planning as a family. To do this efficiently, consolidate your accounts withone manager. Approach 1: If you maintain separate accounts, each account could have its own asset allocation. If the marriage doesn’t
work out you can more fairly go your separate waysthen if you had only equities and your spouse only bonds. Approach 2:  Use an aggregate
approach with an overall asset allocation for both of you so that the accounts
as a whole are balanced. With this approach, you can focus tax exempt funds on less
tax efficient investment transactions and the spouse most at risk for
malpractice might hold the hedge funds and alternatives which would be harder
for a claimant to seize.

Budget:

Your goals, needs and lifestyles are likely to change from when you were each single. So it‘s really worth revising the budget in light of
the new objectives. This can be then
coordinated with your investment planning
revisions. The budget should start to take account of long term goals most
single people don’t address, like a new home, a child, even retirement.

Prenuptial agreement:

Pre-nups are common and need to
be considered well before your marriage. If one should have been completed, but wasn’t, a
post-nuptial agreement can be done. While likely not to be as effective as a
pre-nuptial agreement, it can still avoid a lot of heartache if the marriage
doesn’t work out. Also, pre- and post-nuptial agreements can be used to
backstop asset protection and other planning. In any event, whether you have a
pre- or post-nuptial agreement, signing it should not be the end of its
relevance to your planning.  Even if it was an unpleasant experience,
don’t ignore it. Consider periodically how the agreement affects your planning. Once done, the handling of all post-marital
finances should be addressed in accordance with the provisions of the
prenuptial agreement. For example, if one spouse is to pay certain expenses or
keep separate accounts, that should be done.
If accounts are supposed to be titled a certain way, do so. If you vary from
the agreement, document that you are intentionally doing so. If the variations
are significant have your respective matrimonial counsel prepare a
modification.

Life Insurance: Most singles don’t have life insurance,
but
when you married you may have bought a house, or taken on more debt then before.
Debt and financial obligations indicate a need for insurance to
address the risk of death.The fact that you are both working doesn’t mean that the
unexpected death of one of you won’t affect the survivor in a financially
ruinous manner.  Insurance is likely to be inexpensive and easily
obtainable at this young stage of your lives. If a child is even as
possibility, get insurance in force well in advance. The time to consider
coverage is not after the baby is born.

Disability Coverage:

If you have a large mortgage for the first time, a disability of either of you would be a financial
disaster. Disability planning may not have been an issue when single because
neither of you may have had the level of debt
and “overhead” that you
now have
as a married couple.

Wills:

You need new wills, powers of attorney and
living wills. At this stage each
of you may name your own family members, not
your new spouse, but these
issues need to be addressed.

Beneficiary Designations:

Don’t forget to update your IRA,
retirement plan, insurance and other beneficiary designations to reflect your
new spouse, if that is your intent.