Getting married? Better update your financial plan

You’ve talked about old girlfriends and boyfriends. You’ve talked about whether you want children. You’ve talked about your mothers. Now financial advisers say a discussion about money should be high on your to-do list before tying the knot this summer. Sophie Salcito, an investment adviser with Vancity in North Vancouver, B.C., says couples should make a full disclosure to one another about what they own and what they owe in order to avoid any unpleasant surprises after the big day. “Sometimes people don’t feel comfortable talking about that, but I think it makes for a better start to the relationship going forward if each picture is clearly laid out,” she said. A failure to disclose all of your debts could make for an awkward discussion when it reaches credit check time for a mortgage and one person’s score threatens to derail the loan. If you’re already living with your spouse-to-be, you may have already tackled such thorny financial issues. But for those just bringing their households together, it’s smart to set a budget and create a financial plan that works for both of you. Should you combine bank accounts or keep them separate? That depends on what works for your particular situation. “What you are trying to figure out is what is each person’s value around money,” Salcito said. “Do we have one person who’s a spender and one person who’s a saver? …. We’ve got to try to figure out how to bring those two together.” If combining all of your accounts doesn’t work for you, Salcito recommends at least one joint account that can be used to pay for shared expenses like a mortgage or rent. Couples with a large difference in income may also want to look at using a spousal RRSP to help reduce their tax burden in retirement. Getting married may also mean a change in your financial goals, whether that means planning for a house purchase, determining your retirement age or building savings for your children. Patrick Fitzgerald, a financial adviser with Sun Life, said it’s important to discuss your goals and priorities as you update your financial plan. “Taking that step to meet with a financial adviser is the first step toward building out that plan, and the success ratio of achieving goals is enhanced just based on having a written plan,” he said. “At the end of the day, when you’re looking through some of those issues — even if you’ve had a thought-through conversation as a couple — there may be other probing questions that a financial planner can ask that will trigger responses that will have couples have takeaways to think about.” Salcito also reminds couples they should consider updating the beneficiary on their RRSP, TFSA, pension and other accounts to their new spouse. “That gets missed all the time,” she said.