Everything you need to know about combining your finances.

So you just got married. Congratulations! Now that your wedding and all its surrounding activities have passed (without a hitch, right?), it’s time to take a closer look at what marriage means for you and your spouse when it comes to finances. It’s not as exciting as wedding cake sampling, but in the long run, much more important. The first step is the obvious one of sharing everything with one another. Inform your partner of your salary, investments, debts, and credit score. It will be easier to make your shared financial action plan when you’re aware of each other’s details.

Here are some quick yet important pieces of wisdom you and your partner can use to ensure your new life together gets stronger—and more financially secure—as time goes on.

Combine your bank accounts and credit cards

Merging your accounts doesn’t need to be a priority as soon as you marry, but it makes budgeting easier and more organized when your money is in one place. A joint savings account also helps you work towards taking your next vacation or purchasing a new home. Visit a bank together and speak to a specialist about account options. Opening multiple accounts could help you manage your monthly expenses with one, while saving to invest with another.

Joint credit cards are part of the same conversation. If you use a credit card that has an annual fee, having multiple cards from a shared account can reduce the fees you pay. Keep in mind that you’ll be spending for two, so be cautious of running the balance up. If there’s a chance you’ll be forced to carry a balance at some point, apply for a card with a low APR (annual percentage rate). Moving forward, team up to avoid the habit of only paying the monthly minimum on your bill. Doing that may mean you actually pay more on every purchase you make.

Building credit is really important when it comes to taking out loans or signing up for services. Responsible—let’s say that again—RESPONSIBLE credit card use is a good way to build your credit score. Get in the routine of using your credit cards consistently and never miss payments. When you’re ready to offer on a home or purchase a car, you and your spouse will be in a better financial place. Most banks offer a credit score feature, so take advantage of that because you should always know what your score is.

Team up on debt

Debt is a word that can bring cold sweat and sensations of anxiety to countless people. Many of us have it in the form of student loans, credit card balances, car payments, or one silly mistake you made years ago. Try not to panic. As a married couple, you might have double paychecks (and double debt), but in any scenario, you’re a partnership and should team up on handleing debt together. Sit down and be strategic about approaching what you owe, how much, and to whom. Next, devise a plan that best helps you start crossing debts off your IOU list.

The two most common systems of debt paydown are called “The Avalanche” and “The Snowball” methods. The Avalanche method consists of paying down multiple debts in order of interest rate (from highest to lowest), helping you save the most money in the long run. With the Snowball method, debts are paid in order of balance size, starting with the smallest. The Snowball is may be an appropriate option if you and your spouse have had a hard time paying down debt in the past. Seeing an immediate impact by paying off small balances quickly can encourage you to continue your battle against debt.

Agree on investments and a retirement plan

Investing is an important point of discussion for newlyweds—a discussion that should continue throughout marriage. Retirement may seem like a lifetime away, but it's not that far off in reality, so start your marriage on the right foot and begin preparing.  A common assumption is that retirement funds are for individuals, not couples. However, there are a variety of retirement paths you can pursue together. Start by figuring out if either of your employers match retirement contributions. This is free money and should be taken advantage of. Next, research investment categories you can explore. Speaking to a financial professional might be the best place to start if you want to be guided through the world of IRAs, 401(k)s, equities, fixed income investments, real estate, or other investments. Don’t assume that you need a lot of equity to start investing. There are always options to start small, now. Make it your mission to learn a little about investing each day. Before you know it, you and your spouse will have your shared money working for you.

“The two most common systems of debt paydown are called “The Avalanche” and “The Snowball” methods.” 

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