10 Financial Questions to Ask Before Saying “I Do”

If thoughts of marriage are filling your head this Valentine’s Day, it may be time to take a good look at your finances…and those of the one you love. Financial problems are often among the greatest challenges facing couples. With many people facing increasing levels of debt and more stringent bankruptcy laws making it more difficult to eliminate even crippling levels of debt, being on the same general financial page is more important than ever.

The issue is especially important for those under 35. MSNBC cites a report from the Federal Reserve which found that the credit card debt carried by young adults between the ages of 25 and 34 has risen from $3,989 in 1983, to $12,000 in 2001. In addition, soaring tuition costs and fewer federal education grants has resulted in undergraduate students earning their degrees, along with nearly $20,000 in debt. That figure will rise to $45,000 for graduate students, and professionals, such as doctors and lawyers, will commonly have debts exceeding $100,000, MSNBC reports.

To help couples determine whether they are on the same financial page, the Texas Society of Certified Public Accountants (TSCPA) provides the following entertaining “compatibility quiz”:

  1. How often do you and your significant other or spouse discuss your financial situation?
    • Once a week
    • Once a month
    • Once a year
    • Never
  2. Have you set a monthly budget or plan to guide your spending?
    • Yes
    • No
    • Don’t Know
    • What’s the point? We don’t have any money.
  3. How have you divided the financial responsibilities in your household?
    • One takes care of everything. The other is oblivious.
    • One pays the bills, while the other tracks investments and insurance coverage.
    • We sit down together and do everything as a couple.
    • Nobody takes responsibility for financial matters
  4. If you receive a bonus or an unexpected windfall, how would you spend your money?
    • Immediately head to the mall for an afternoon of self-indulgence.
    • Pay down mutual debt.
    • Save a little, spend a little
    • Contribute to an IRA or other retirement savings account.
  5. Have you ever tried to disguise or hide a purchase from your significant other or spouse?
    • No, I’m always honest.
    • Maybe once or twice.
    • Only around the holidays
    • Regularly
  6. How much money would you feel comfortable spending on a single purchase without first conferring with your significant other or spouse?
    • Less than $50.
    • $51-100
    • $200
    • I don’t see any reason to check with my spouse before spending money.
  7. If you want to make a major purchase as a couple, what do you do?
    • Open up a store charge card, or charge it on the card with the most room.
    • Save the amount needed before making the purchase.
    • Take the money out of your savings account.
    • Resist temptation, and make do with what you have.
  8. How do you plan to teach your children about money responsibilities?
    • An allowance system where children earn money for completing their chores each week.
    • We regularly give our children money to buy whatever they want, because we want to be generous with our money.
    • We try to set a good example for our children, and we expect them to follow our lead.
    • We talk about spending, saving, and investing with our children
  9. Have you made provisions to care for your significant other or spouse in case of death or disability?
    • Yes, I have an updated will, along with the disability and life insurance policies.
    • Yes. I made a will 10 years ago.
    • No. I’m too young for anything bad to happen.
    • No. My significant other or spouse knows how I would want my property and possessions divided.
  10. Are you and your significant other or spouse actively saving for retirement?
    • No, we hope to use our family inheritances for retirement.
    • No, we don’t have any money to spare.
    • Yes, we regularly set aside money for retirement.
    • Yes, we have mapped out a retirement savings strategy and follow the plan.

A “financially compatible” couple will answer at least eight of these ten questions the same. This does not, however, mean that they are making wise financial decisions, just that they are making the same financial decisions. Meeting with an accountant or financial planner can assist this type of couple to have more confidence in their financial decisions.

Couples who answer between five and eight questions the same have a financial relationship that is a work in progress. More communication is needed to get everyone on the same page, but at least this couple is in the same book. Again, professional advice may be in order.

Couples who agreed on less than five of the answers are in serious need of a money makeover. Obviously, both individuals have very different views on financial matters and probably very different financial goals, although the two are not always related. A financial professional can help bring this couple closer, but it is going to take a great deal of work.

Tips on how CPAs can assist couples at any level of financial compatibility address the financial issues raised in this quiz can be found at www.ValueYourMoney.org. Such financial advice is particularly important to those under the age of 35 who have limited financial knowledge, poor saving habits and increasing levels of debt.

“Young adults have nearly no knowledge of investing so they’ll have a negative savings rate and no assets outside their home, yet they’ll be retiring later than ever before,” Robert D. Manning, professor of finance at Rochester Institute of Technology and author of Credit Card Nation, told MSNBC.

Tamara Draut, author of Strapped: Why America’s 20- and 30-Somethings Can’t Get Ahead, agrees, telling MSNBC “It’s much more difficult for this generation to work to educate their way into the middle class. They’ll probably never match their parents’ standards of living because of big loans, low income growth and a cost of housing that’s much more expensive than for a generation ago.”


Already a member? log in here.

Editor's Choice

Upcoming CPE Webinars

Dec 3The materials discuss the concepts and principles in the AICPA’s new special purpose framework.
Dec 8Kristen Rampe will cover how to diffuse the tension in challenging situations in this one-hour webinar.
Dec 9A key component to improving your firm’s workflow efficiency while enhancing your profitability at the same time is how you leverage emerging technologies.
Dec 16Kristen Rampe will give tips on how to bring confidence into the room and build a valuable network.