NEW YORK (TheStreet) -- Marriage joins people in more ways than one, but nobody should tie any matrimonial knots until they have worked out the financial side of their marriage arrangement. Like it or not, there is a "business" side to any marriage commitment, and in the interest of a long-lasting life together those issues should be front and center before a wedding.
After all, the last thing any spouse wants after the rings are on fingers is a financial surprise that adds debt and anxiety to a new marriage.
To nip any such problems in the bud, the California Society of CPAs offers a list of tips and strategies newlyweds need to work out before the wedding:
Talk it out. The CSCPA strongly advises mapping out your money life together. You can that process by establishing some short-term goals, especially in paying off any debt coming into the marriage, then segue into long-term goals such as starting a family, starting a college savings program and buying a home. Agree beforehand how these expenses will be met and how much each spouse will be contributing.
Track money coming in and going out. The best way to get both spouses on the same page financially is create and maintain a budget together. The CSCPA advises including the following items in a new household budget for married couples:
- Wages and salary
- Bonuses and commissions, interest, dividends and rental income
- Unemployment insurance
- Income from investments and retirement accounts
- Any inheritance money on the table
Once you've tracked incoming assets, married couples should account for expenses. That should include:
- Mortgage or rent
- Insurance premiums
- Child care and utilities
- So-called "intermittent expenses" including food, clothing, dental bills, gifts and car repairs
Watch out for hidden expenses. As any financial consumer knows, single or married, the biggest budget busters are the ones you didn't see coming. So make sure to account for "irregular" costs that come down the pike once in a while. (A property tax bill is a good example, as are holiday spending bills.)
Agree to put away small amounts of money every day. If you and your spouse can each put away $5 a day, that's $1,825 each at the end of the year. Double that daily amount and you'll have an extra $3,650 apiece. Put the money in a short-term savings account, bank certificate of deposit or money market account. It won't earn much interest, but it will be there if and when you need it.
The CSCPA also advises consolidating any debt into one monthly payment and winding that debt down as fast as possible. Interest on debt is one of the biggest money-saving killers for newlyweds.
Also, couples should max out on employer retirement savings plans, and don't touch the money. That cash is growing tax-deferred, and it compounds regularly, two huge benefits for any new family with an eye for the future.
The advice seems simple, but applying it directly is harder than it looks. So keep your eyes on the prize and be honest with each other about money. That may be the most important factor of all for newlyweds just starting a new life together.