Wedding costs, blending finances important issues for newlyweds

|tab|

Paula Dougherty, ChFC, CLU, MBA, is a financial planner with American Express Financial Advisors Inc. |ret||ret||tab|

|ret||ret||tab|

According to Bride's Magazine, American couples spend $42.4 billion on weddings every year. Per couple, the average cost of a wedding is nearly $19,000. Weddings are expensive. |ret||ret||tab|

However, with some careful planning, a couple can tie the knot without breaking the bank.|ret||ret||tab|

|ret||ret||tab|

Develop a budget|ret||ret||tab|

The first step is to set priorities and a wedding budget. The best way to develop a budget is by figuring out how much you can spend in cash. That means no loans, credit cards or tapping into retirement savings to pay for the big day. |ret||ret||tab|

Find out in advance if one or both sets of parents is willing to contribute and how much. |ret||ret||tab|

If there's not enough to pay for the dream wedding, consider a longer engagement to buy more time to save. Also, if you're considering financing the wedding with credit cards, be careful. You may end up paying for it until you are grandparents.|ret||ret||tab|

|ret||ret||tab|

Calculate costs|ret||ret||tab|

After establishing how much to spend, begin calculating costs associated with the wedding. Online budgeting tools on www.TheKnot. com or www.Weddingchannel.com can help. When you plug in the total amount available to spend and the expected number of guests, you receive an itemized budget. These sites also include tips on how to cut costs.|ret||ret||tab|

Next, figure out what you can and can't live without. |ret||ret||tab|

For example, the bride-to-be may want a very expensive gown, but she may be willing to sacrifice it for her dream wedding location instead. |ret||ret||tab|

|ret||ret||tab|

Look for bargains|ret||ret||tab|

All of the elements of a wedding can add up, so be sure to shop around for deals. Consider handling certain things, such as invitations, yourself. Also, have friends provide or chip in for elements of the wedding as their gift (e.g., photography, flowers, music, etc.). Remember, you don't have to spend a ton of money to have a nice wedding. Buy wisely, monitor costs, and focus on saving money. |ret||ret||tab|

|ret||ret||tab|

Blending finances|ret||ret||tab|

It's important to discuss the joining of finances before the wedding. With good communication and planning, newlyweds can find financial bliss, or at least compatibility.|ret||ret||tab|

|ret||ret||tab|

Financial documents|ret||ret||tab|

Although no one likes to plan for a divorce, prenuptial agreements can save a lot of headaches if a couple decides to separate. Prenuptial agreements dictate the individuals' rights and responsibilities during marriage. With it, a person can disinherit a spouse and designate or exempt major assets such as property or business from the marital estate.|ret||ret||tab|

There are many important documents to update before and after getting married. Documents that involve the designation of beneficiaries or a next of kin, insurance policies, benefits, wills, trusts and powers of attorney, as well as documents related to retirement, would all need to be changed. |ret||ret||tab|

|ret||ret||tab|

Budgeting and expenses|ret||ret||tab|

The couple will have to develop a joint household budget. First, estimate the monthly expenses. Determine the fixed expenses (rent/ mortgage payments, auto costs, utilities, etc.) and discretionary spending (groceries, entertainment, etc.). Don't forget to factor in big-ticket items, such as furniture, home improvements or vacations. Finally, remember to include savings for an emergency fund. |ret||ret||tab|

|ret||ret||tab|

Joint or separate accounts|ret||ret||tab|

Once the expenses are figured, agree on how to pay them. Consider setting up a joint checking account while each spouse also keeps his or her own separate checking account. |ret||ret||tab|

With this arrangement, each person is responsible for regularly contributing to the joint account, and all joint expenses can be paid from this account. What remains in the separate accounts is each individual's to spend as he or she wishes. This arrangement not only assists with record keeping for tax preparation, but it also leaves each person with some financial freedom. |ret||ret||tab|

When planning a wedding and in a marriage, money should be approached as a partnership. Consider meeting with a financial adviser who can help put a financial plan in place for all of the important life moments and short- and long-term goals.|ret||ret||tab|

[[In-content Ad]]