For young couples in Texas who are starting out, it may be therapeutic to discuss one’s finances and to take action with the other spouse to organize and update a variety of matters. It can be helpful and may even mark the spirit and longevity of the relationship. Things to look at early in the marriage for preliminary estate planning purposes are health insurance benefits, existing wills, investment accounts, retirement plans, beneficiary designations and the like.
The couple should learn in what ways there are financial benefits for married couples, and where appropriate, they can take advantage of those offerings to help in building their nest egg. Some of these include tax benefits for married couples, government benefits and spousal IRAs. The couple may want to scour their credit cards and pay off any cards with high interest rates. Essentially, that is the same thing as making a good investment
Saving is harder to do these days as the cost of living rises and salaries do not. Saving, however, is extremely important and may be the deciding factor in building up a truly useful retirement fund. It is recommended that 20 percent of income be aside for retirement. There are matching funds with some companies that can get a couple off to a big head start in the savings department.
Education savings plans allow a couple to save for their children’s education. Interest and earnings are not taxed as the account accrues. The added bonus is if you actually use the money saved for education when you take it out, that money is tax free also.
Whether one lives in Texas or another state, it is best not to use retirement savings to help send a child to school. This is an easy way to assure that there will be no retirement. Student loans may be a better road to go. Investing and saving should continue and if the marriage is successful, following the foregoing estate planning rules of thumb will bring a tidy sum to fruition in the couple’s later years.
Source: U.S. News & World Report, “10 Tips for Couples and Young Families to Build Wealth“, Christine Giordano, July 25, 2016