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Message: <br /><br /> If you are having trouble reading this email, you may view this article online at: http://www.jweekly.com/29664/full/29664/the-importance-of-prenuptial-planning/ <br /><br /> <b>The importance of prenuptial planning</b> <br /> Friday, June 23, 2006 | by <p>chandra orr </p> <br /><br /><p>As plenty of married couples can attest, money matters can be difficult. Prenuptial agreements and other money matters are rather unromantic. In fact, couples often spend more time choosing china patterns than ironing out key financial details. Financial experts say that’s a big mistake.<br /><br /> “Studies have shown that money is the primary reason couples argue,” said Kyle Pitts, a certified financial planner with Hutchinson/Ifrah Financial Services in Little Rock, Arkansas.<br /><br /> “Indeed, many recently divorced couples identify money issues as the primary reason for the marriage’s demise. Planning ahead can help preserve both marriages and assets,” Pitts said. “Couples must go into a marriage with an understanding of each other’s personal and financial history and goals.”<br /><br /> Planning ahead means opening the lines of communication. Couples must be frank about their fiscal affairs and their long-term financial outlook. Building trust should be the top priority.<br /><br /> Engaged couples should set aside time to talk openly and honestly about money matters and be prepared to disclose all assets, accounts and debts. According to Pitts, lack of honesty in such matters may ultimately lead to failure with your finances and marriage.<br /><br /> After reviewing their finances — and before the wedding — couples should meet with a certified financial adviser to discuss their future goals. Regardless of age, it’s never too early to start thinking about saving for a home or retirement.<br /><br /> “By meeting with a third party, the couple can openly discuss financial goals — individually and collectively — such as saving for a home or car purchase, paying for the children’s education, if having children is an option, and retirement planning,” he said. “All short-term and long-term goals should be addressed.”<br /><br /> Once those goals are set in motion, couples would do well to create a prenuptial agreement, a will and a power of attorney. The bride and groom might not want to consider such topics on the eve of their wedding, but these important documents will create a smooth transition in the case of divorce, death or injury.<br /><br /> “A prenuptial agreement will supersede state laws or judge orders,” Pitts said. “Also, if a spouse has other business interests prior to the marriage, the other business partners might require a prenuptial agreement to protect their own interests.”<br /><br /> After the big day, the lucky couple can begin their fiscal future as husband and wife. Merging bank accounts seems like a logical first step, but while a joint checking or savings account goes hand-in-hand with the idea of a successful marriage based on sharing and trust, many couples prefer to keep both joint and individual accounts. The key is for couples to be up front about their wishes and devise a plan together for how best to manage multiple accounts should they go that route.<br /><br /> Merging debt may seem tempting as well, but Pitts cautions against consolidating individual education debts.<br /><br /> “If couples have student loans, they should consider keeping them separate to best take advantage of loan and interest deferrals and deductions, as well as lower rates,” he said. “This is an obligation of the individual. If a death occurs, if the debt is consolidated, the remaining spouse still has the obligation.”<br /><br /> Separate bank accounts and separate debt doesn’t mean couples must live separate financial lives. Creating a credit history as a couple is a top priority, according to Pitts. Soon after the wedding, couples should open a credit card account or a similar line of credit together to begin building a joint credit history. This is a simple way to establish credit worthiness. Plus, a joint credit history may improve the credit rating of a spouse with a lower credit score. In the meantime, couples should keep at least one individual credit card in their name to maintain a personal credit history.<br /><br /> Following the wedding, newlyweds should also update their retirement plans, insurance policies and tax records to reflect their new married status. This includes changing beneficiaries on Individual Retirement Accounts, 401(k) plans and insurance policies to include their new spouse and changing their income tax withholdings to avoid paying more in taxes than they should.</p> <p> </p>

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