Does your fiancé and future spouse have more wealth than you? While you may be marrying for love, finances are an important factor in your new marriage. How can meeting with a CPA (certified public accountant) help you navigate this unusual newlywed situation? Here are five ways they'll help you and your new spouse.
1. Identify and Protect Nonmarital Assets
Anyone who enters a marriage with assets of their own should understand how marital and nonmarital assets work. In the event that something does happen to you, your marriage, or your debt, this is important information to protect both. A CPA will help you identify what each brings to the marriage, value the assets, and maintain them in ways that protect their status.
2. Decide How to Combine Finances
How will you and your spouse manage household finances? There are many ways to combine — or not combine — your money. Some couples combine as much as possible while others keep most accounts separate. You might divide up household financial obligations on a percentage basis based on each person's income or split things evenly. A good accountant will work with you and crunch the numbers to make it work.
3. Get Independent Counsel
The value of outside professionals during family discussions is not only their training but also their independence. Your CPA has no skin in the game, as it were, regarding how to resolve potential money challenges as a couple. But they can help direct the conversations productively, offer recommendations, and execute your plan. And their presence often keeps things less emotionally fraught and more effective.
4. Handle Your Income Taxes
Should you file your state and federal income taxes jointly as a couple or separately? Who should handle the details of tax filing? If filing together, can you rely on your spouse's numbers? The more income or assets either partner has, the more complex their taxes will be. Your accountant will walk you through them and help with things like updating tax withholding.
5. Make a New Retirement Plan
Both you and your wealthier partner may need to consider how your relationship affects retirement planning. Do you need to put away as much? Should you contribute more? Can your spouse cover all retirement expenses? Should you combine any accounts? Even young couples benefit from assessing their preparation whenever their life situation changes.
Where to Start
Clearly, a good CPA is a valuable resource for anyone marrying into more wealth than they're used to. From preparing taxes to helping you find the right financial balance as a couple, they will work with you to make your new marriage as successful as possible. Make an appointment today to get started.
Contact a CPA to learn more.
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