Blue Water Healthy Living
Opinion

Dave Says

Combine finances

Dear Dave,

Is it okay to combine finances with someone and start working on a budget before you marry them? I just got engaged, and we’ve been talking about the idea of getting a head start on our finances together.

Autumn

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Dear Autumn,

First, congratulations! I hope you two will have long and happy lives together. Now comes the hard part. But you asked for my opinion, so here goes.

No, it’s not a good idea to combine finances with anyone you’re not married to. Don’t get me wrong, I’m glad you two are thinking about your finances and your future—and I’d never wish anything bad for you—but all kinds of things can happen before you become husband and wife. What if you spend time paying off his debt, or vice versa, then the relationship doesn’t work out?

However, this doesn’t mean you can’t begin working together on budgets for the future, and planning and dreaming about the goals you have together. The thing to keep in mind is you’ll both need to be operating in full transparency mode to make it happen. He should know all about your income and debts, and you should know all about his. Along the way, you two need to have serious, regular discussions about saving, spending, and debt to ensure you’re completely on the same page with your finances before the big day.

There you go. My advice is both of you should pay only your own bills until after you’re married. And remember, once that happens there’s no yours and his anymore—it all becomes ours.

—Dave

Self-insure?

Dear Dave,

I’ve been researching long-term care policies. Can you reach a point financially where you can self-insure long-term care needs, and not buy a long-term care insurance policy?

Paul

Dear Paul,

It’s possible, mathematically speaking, if you have the resources available to pay for the care you’d receive in a nursing home or similar facility for about 20 years. Not many folks have that kind of money, though. I think it’s a large enough bill that it makes sense to transfer the risk to a long-term care insurance policy.

Keep in mind, too, if you’re married you have to think about your spouse, and make sure they have enough to live on comfortably at the same time. That’s a lot of money. And that’s why I advise virtually everyone to put good, long-term care coverage in place at age 59 or 60. It can mean the difference between living with dignity, or having to depend on the government!

—Dave

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