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Money After Marriage
What You Can Do to Plan for
Your Financial Future
Your Financial Future
By Megan L. Fowler
"Getting married will change the income tax filing status of both partners from 'single' to 'married filing jointly,'" says Debbie Webb, a certified public accountant with Thompson, Derrig & Craig in College Station, Texas. "Both incomes will be combined and a different tax rate schedule will be used to figure the tax on their income."
The income tax that the couple will pay together almost always differs dramatically from the combined total of what they paid separately, she says. Sometimes the total is much more, and sometimes it is much less, depending on how much each earns. "Getting a good estimate of the income tax bill will help avoid ending the honeymoon with financial woes," Webb says. "Note also that the entire year's income is combined for income tax purposes in the year of marriage, even if the wedding bells ring on New Year's Eve."
Maintaining joint or separate bank accounts is really a matter of personal preference. One is not more beneficial or economical over the other.
"It seems the most common method is now to open a joint account for common goals and bills and for each individual also to have a separate account for their spending," O'Neill says. "Joint accounts ensure that the bills and savings goals are met. And establishing separate accounts allows each individual to have the freedom to spend their own money whenever and however they desire."
But whichever system you use, keep the number of accounts to a minimum so you streamline your household bookkeeping, Knuckey says. "Money management should not be a time-consuming chore," she says.
