When you’re single, you get to call all the shots. You decide what to buy and how to buy it. You decide whether to loan money to a friend or family member. You decide whether to blow off the debt collector and the risks that come along with that. But when you marry, this all changes.
Marriage is a legal relationship. As a result, there are many implications for what would otherwise be “your” money and property. Suddenly, you have to think about the effects your decisions may have on someone else. You may even be restricted from doing certain things without your spouse’s consent.
Marriage has a direct impact on many financial issues, such as income, debt, and property rights.
Avoiding money problems after you tie the knot
Marriage is a legal partnership. As a result, in most states, spouses have equal rights to marital income, and they share responsibility for marital debt.
This is one of the many reasons it is important to choose your spouse carefully. Financial compatibility is a critical part of a successful marriage. If one spouse likes to spend money and doesn’t mind being in debt, that can have a significant impact on a spouse who prefers frugality and savings.
You can reduce the likelihood of negative financial impacts by discussing issues up front, setting expectations and goals, and developing a family budget. This usually works best when both spouses play a meaningful role in family finances.
Avoiding confusion about property after you marry
When you marry, your property rights change in ways dictated by state law. Some states presume that anything acquired during a marriage is jointly owned by both spouses. Other states do not. Regardless, after you marry, there is a strong likelihood that your spouse has an ownership right in some of your property or may later claim an ownership right in that property.
Why does all of this matter? Here are some of the reasons:
- A creditor trying to reach assets to satisfy a debt;
- A divorce or legal separation; and
In circumstances like these, hot disputes can arise over who owns what. While you may be able to control some of these events, many are beyond your control.
In addition to the impact of marriage on income, debts, and property, the laws of most states place strict duties on spouses. For example, in most states, spouses have a legal obligation to support one another. They also have what is called a “fiduciary duty” to each other. This is the highest duty imposed by law, requiring each spouse to act in the best interest of the other person. Although the parameters of fiduciary duties vary based on state law, this generally means that one spouse cannot waste marital property and cannot hide debts or assets from the other.
Getting married brings with it many new adventures. Having clear expectations about marriage, money, and property helps to keep all those adventures positive.
If you need advice about marriage and its effects on money and property, you should consult with a licensed family lawyer in your state.