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Newlyweds can benefit from financial planning tips

POSTED: June 21, 2007 5:04 a.m.

It’s almost June, a popular month for weddings. If you’re getting married this month, you have a lot to think about: a rehearsal, a ceremony, a reception, possibly a honeymoon. But most important of all, you’ve got the anticipation of starting a new life together. To help make that life a happy one, you and your new spouse will need to communicate with each other on all types of issues — and one of the most important of those issues is your joint financial situation.

So, once the wedding festivities are behind you, take some steps that relate to your future financial well being. Here are a few suggestions:

• Establish financial goals. You and your spouse can become disciplined money managers if you’re both working toward some joint long-term financial objectives, such as a new home. If you eventually have children, your goals may expand to include college. And throughout your working life, you’ll want to put money away for retirement. No matter what your goals are, you’ll have a better chance of achieving them if you set out a strategy — and stick to it.

• Don’t put off investing. How much money you have available to invest depends on your income and expenses. When you’re just married and establishing a household, you may not feel that you have a lot of cash to spare, but make it a priority to put away something each month, even if it’s only a small amount. If you can get into the investment “habit” right away, it will serve you well throughout your married life.

• Take advantage of retirement plans. If you and your spouse are both working, you may each have access to a 401(k) or other employer-sponsored retirement plan. Contribute as much as you can afford to each plan - at least enough to earn the employer’s match, if one is offered. Also, look closely at how you are each allocating your dollars within your respective plans. Try to avoid duplicating each other’s investment choices. By spreading your money around a range of investments, the two of you can potentially reduce the effects of market volatility and give yourselves more chances for success. A financial advisor can help you identify the investment choices that are appropriate for your risk tolerance, goals and time horizon.

• Get control of your debts. Your debts, and those of your new spouse, are now of concern to both of you. While some debts — such as a mortgage — may be inevitable, it’s generally a good idea to keep your debt load as low as possible. That’s because the more money you spend on debts, the less you’ll have available to invest for your future. By going over your student loans, car loans, credit cards, etc., you may be able to develop a strategy to reduce your overall debt load.

By following these suggestions, you can start married life off on the right foot, at least in regard to your financial situation. As for who gets to write the thank-you notes for the wedding presents — well, that’s another matter.

Jeff Hupman is a financial advisor with Edward Jones in Rincon.

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