I’m married. I have a husband. My last name is different. All those things still sound surreal to me, but they are now parts of my everyday life! After a truly perfect wedding and then a honeymoon on the beach, life is back to normal. However, there are a few newlywed to-dos to tackle when the honeymoon is over. Most people know the basic ones– get a new driver’s license, combine bank accounts, decide who will take out the garbage– but the list can be more in depth than you may realize. Below are some things often overlooked by newlyweds as they merge their lives.
Update beneficiaries on retirement accounts and life insurance.
IRAs, 401(k)s and group term life insurance flow by beneficiary designation when you pass away. It’s common for unmarried individuals to list parents or siblings as beneficiaries. However, a new spouse generally becomes the primary beneficiary post-marriage. Those other parties are shifted to contingent beneficiaries or removed entirely.
Execute estate documents.
A logical complement to beneficiary updates is to execute estate documents. In its most basic form, include a will, power of attorney and health care directive for each spouse. As life becomes more complex (ex. children appear, the purchase of a second home, etc.), the documents should be revised.
Evaluate your health insurance.
Another newlywed to-do is to decide what to do about health insurance. You can choose to go on one plan or remain separate. If both parties have health insurance offered through their employers, take the time to explore which plan meets your needs. Depending on health issues or what each employer covers, it may make sense to remain separately insured.
Student loans are one of the most likely debts brought into a marriage. Look into refinancing, especially if one spouse has a significantly higher credit score as that may help get better loan terms. If a home purchase is in the near future, begin vetting mortgage options and working towards pre-qualification.
Change W-4 elections for tax withholding.
One should review their current tax withholdings on wages and adjust, if necessary. Some people choose to do this after the first year of joint tax filings because it can be hard to predict the tax impact with a mid-year marriage or if a home is purchased during the year too. Remember, the lower the number of elections you claim, the more withholding you will have taken out of your paychecks.
Revisit property and casualty insurance.
Combining insurance may lead to some overall savings. For auto insurance, it is common to have both spouses listed as drivers on all vehicles you own. Homeowners’ or renters’ policy should include both spouses. Consider adding an umbrella insurance policy for more liability protection.
Consolidate credit cards to save on yearly fees.
Most credit cards allow you to add an authorized user to an existing count for much less than the annual fee the primary user pays. This can help you as a couple easily accumulate more credit card points at a lower cost. Cancel cards if you no longer plan to use them and there is an annual fee.
The most important newlywed to-do should involve considering engaging an advisor for financial planning. This process provides insight into how your spending and savings habits today affect your future goals and aspirations. It also identifies areas for adjustments. Being equipped with the knowledge to then make those adjustments sooner than later will pay significant dividends going forward.