Millionaires identify top financial planning strategies for couples thinking of tying the knot. What’s their No. 1?
A financially healthy marriage begins with open communication, according to Millionaire investors, who rank a frank discussion about money first among financial planning strategies for young couples. What other financial planning strategies rank in the Millionaires’ top five?
· No. 1: Before getting married, sit down and outline your financial goals, expectations and values (77 percent). Millionaires tend to enjoy long-lasting marriages and attribute their wealth, in part, to a successful partnership with their spouse. They also understand that disagreements over money are a leading cause of divorce and rank open communication as the most important of financial planning strategies for a financially health marriage.
· No. 2: Buy a home as soon as you are financially able (48 percent). Millionaires enjoy high rates of home ownership and invest in many types of real estate to build and consolidate their fortunes. The housing crisis has made Millionaires more cautious about the real estate market, and, according to a Millionaire Corner survey conducted in March, wealthy investors also strongly advise financial planning strategies enabling young investors to save for retirement.
· No. 3: Delay having children until you are financially secure (44 percent). Millionaires express high levels of concern about the financial wellbeing of their children and grandchildren. The worry ranks as their top personal financial concern, and a significant share say they are helping or will help pay for their grandchildren’s college education and/or wedding. No wonder putting off parenthood ranks high on their list of financial planning strategies!
· No. 4: Go to premarital counseling (38 percent). Premarital counseling may not sound like it belongs on a list of financial planning strategies, but Millionaires place a high premium on marriage. The vast majority (82 percent) is married) and 6 percent is widowed. The divorce rate is roughly 4 percent, according to a Millionaire Corner wealth study conducted in December 2010.
· No. 5: Before getting married, check your intended’s credit score and debt level (36 percent). Among other liabilities, credit problems could prevent your future spouse from getting a job. A credit check could prevent you from marrying a dead beat – not the best of financial planning strategies! A credit check will also tell you whether a potential life partner uses credit responsibly since a bad credit rating is usually the result of late payments or borrowing too much.
Millionaires differ over the issue of comingling money. About 36 percent say pooling resources promotes a financially healthy marriage, while about 19 percent recommends keeping accounts separate. Ranking lowest on the list of financial planning strategies: Before getting married live together to see if you are financially compatible.
What top five financial planning strategies would you recommend to a young couple?