Now that the anticipation, planning, excitement, and joy of your big day and the honeymoon are behind you, now what? As you settle into your new life together there will be issues to resolve regarding money and finances.

Yours, mine and ours often sums up the new financial dynamic for most couples. There are a number of changes that will be occurring in your finances. This is a major transition for most people. This series is presented as a guideline of practical tips to hopefully help you reduce a major cause of stress for most couples – money!

Hopefully this guide will lead to open, honest communication and agreement on your new financial strategy. Your philosophy or strategy on money, debt, goals and objectives and finances in general is a key area of your new life. Your individual beliefs as well as your “couple” beliefs are important to understand and integrate into your strategy. Keep in mind that you may have different individual beliefs on a lot of these topics. Neither is right or wrong but you should be aware of each other’s beliefs.

Starting Point

A good starting point is to define your philosophy on money. What are your goals and objectives, individually and as a couple? Are they different? How do you view money? How important is it to you? How will you resolve your differences? There are many areas to consider as you develop your philosophy; for example lifestyle, debt, savings, instant or deferred gratification, purchases, financial priorities, goals and objectives.

Create Your Plan

Now that you have defined your philosophy, it is time to move onto some of the nitty-gritty. To create your plan, start with the basics. Cash flow, income and expense reconciliation, balance sheet, written goals and objectives, priority listing of goals and objectives with timeframes, establish a regular review cycle of your finances, monthly for example.

The first step is to have an accounting of your income and expenses. Often this is called a budget; I prefer to call it cash flow management, as budget is somewhat negative. Expenses can be divided a number of ways, here are some examples; fixed vs. variable, necessities and luxuries. There may be some overlap in these categories.

How will you allocate your income? How will you pay bills? When? How will you handle discretionary income/spending? At what level do you both need to agree on the purchase? How will you allocate income between bills, savings, purchases and your other goals and priorities?

Discuss Your Plan

I have highlighted a few areas for discussion below.

• How will you pay bills? Who? When?
• Income – How will you allocate, bills, retirement, fringe benefits, debt,
  spending money?
• Debt – How to handle existing, new debts.
• Major purchases – at what level – partner consult?
• Emergency Money – What level for comfort zone?
• Savings & Investments – Amount, frequency, decision process.

These should help you start to develop a consistent philosophy and strategy as a guideline for how to handle money and financial matters.

Write It Down

It is a good idea to create a written budget or spending plan, the numbers may shock you. The next step is to create a balance sheet, what you own minus what you owe. Again, this is a starting point to better understanding your finances. As you reflect on the balance sheet it is a good time to write down your goals and objectives, both short and long term.

The worksheets referenced; balance sheet, cash flow, goals & objectives are available at no charge. Simply call Michael A. Masiello and ask for them.

It is suggested to do these exercises individually and then together as a couple. You may find areas that need to be discussed further to reach agreement.

Masiello & Associates is a full service financial planning firm that has been helping people since 1990. They can be reached at 720-0590. Visit our website www.mmasiello.com.

MASIELLO & ASSOCIATES/Estate & Wealth Preservation Council, LLC 1777 English Road, Rochester, New York 14616
Securities Offered Through Multi-Financial Securities Corporation,
Member NASD, SIPC
Masiello & Associates/Estate & Wealth Preservation Council, LLC
& Multi-Financial Securities Corporation are not affiliated companies.

Written by Michael A. Masiello

© Wedding Planner 2004

You may recall, in our first article we outlined the starting points of blending finances, cash flow, balance sheet, goals and objectives and suggestions on how to integrate yours and mine into ours.

The next step is to clearly define and develop your “couples” strategies on cash flow, budgeting, spending, debt management, investments, goals and objectives, in general your financial philosophy and game plan.

OBJECTIVES
We suggest that you break these down into short-term, intermediate, and long term. As with all goals this is the focus of your planning. I suggest you write these down and prioritize them. You may find it easier to create your individual goals and then create a couple’s “goals and objectives” sheet.
The following discussion points and questions will help define and develop your “couples” strategy for handling money. The answers to these questions might surprise you! We suggest writing down your individual answers first and then your “couple’s” answer.

CASH FLOW
How will you handle income and expenses? All into a joint account? Or each individually with a joint account for common expenses? How will you define necessities, luxuries, and delayed purchases?

DEBT
How will you handle existing debts? How about new debt?

BILL PAYING
Who’s responsible for? When? How to coordinate with pay cycles?

BENEFIT COORDINATION
Who will carry the health insurance? How to maximize your 401(k)’s. Do either of you have a 125 Plan?

CREDIT CARDS & ATM’s
What is your strategy? How many? How to use? Pay off strategy.

SPENDING/BUDGET
How to monitor and manage? At what level do you discuss? How to treat minor/major purchases? Written budget with follow up and tracking.

MONEY MANAGEMENT
How much do you want in an emergency account? Do you prefer to save and pay cash for larger purchases? Are you more of a saver or spender? How about your spouse? Can you come to an agreement? Where does current lifestyle rank on your priorities?

INVESTMENTS
Who will manage? Who decides how much? Allocation/risk tolerance? How will you coordinate the different programs? What are your investment goals and objectives?

RETIREMENT
Where does this rank on each of your priorities? When, at what age, at what level of current income? How important is it?

INSURANCE
Taking care of yourself and each other. You should review your Home/Auto policies-possible savings or improved coverage. How much Life Insurance do you have? How much should you have? How important is it? Often overlooked is Disability Insurance.

This exercise is designed to assist you in finding common ground and areas that you will need to compromise on as you develop your strategy.
One of the keys to financial success is to have clearly defined written goals. This provides the roadmap for you to follow. Agreement or at least a negotiated understanding is critical to minimizing arguments and keeping both of you on the same page. Together is the only way this process works.

Setting a goal and working diligently towards its accomplishment can be a source of great pride and reward. Open and honest communication and agreement is important as you integrate the finances of marriage. There will be many areas to include that you each may have a different opinion or experience with. Often this can lead to polar opposite views you will need to work it out to come up with some workable middle ground.

These discussions have the potential to get very intense and emotional. One suggestion is to try and keep this task based do not “attack” each other, but work together to create a “new” plan that you both can live with.
The worksheets referenced in this article are available at no charge, call 720-0590 and we will gladly mail them to you. Visit our website for a variety of timely articles and calculators at www.mmasiello.com.

MASIELLO & ASSOCIATES/Estate & Wealth Preservation Council, LLC 1777 English Road, Rochester, New York 14616
Securities Offered Through Multi-Financial Securities Corporation,
Member NASD, SIPC
Masiello & Associates/Estate & Wealth Preservation Council, LLC
& Multi-Financial Securities Corporation are not affiliated companies.

Written by Michael A. Masiello

© Wedding Planner 2004

This is the third article in a series designed to help you identify and implement a strategy towards money that works for you. You may recall the first article addressed the philosophical ‘big picture’ changes, and the second article addressed a few of the ‘nuts and bolts’ of your new “couples” strategy.

The theme of this article is to consolidate, combine and simplify your finances as you move forward as a couple. This is an opportunity for a fresh start, to correct prior “mistakes” or bad habits and move forward with a new strategy for financial success.
Now you can start to set-up your new finances and accounts. You may need to refer to the first two articles from time-to-time.
The first step is your new budget tracking the inflow and outflow is the logical starting point. You may find Quicken or another software package can help or just a sheet of paper and pen work fine for many.
It may be helpful to review 3 months of your individual expenses and categorize them and then create a “joint” budget or expense tracking. During this transition, a Yours, Mine, and Ours budget sheet may be helpful to track your expenses.
Should you set-up new ‘joint’ savings and checking accounts? What banking relationships do you want to continue? Start-up? You may find it easiest to establish a new joint account for bill payment, while maintaining an individual account during this transition. Do either, or both of you have to change direct deposits, etc.

TAXES
You may want to have your CPA or tax preparer estimate your new tax liability and withholdings adjustments, they can also run a few tax projections based on your filing status. You may find the adjustments can free up some cash flow.

RETIREMENT
Are you contributing to your respective retirement plans? If so, will you continue? At what levels? How will you handle your employment fringe benefits and health insurance? Are you better off under one plan or continuing under individual plans? A side-by-side comparison of your benefit packages will help. Again, you may find a cash flow savings as you pick and choose your benefits.

INVESTMENTS
How will you consolidate, coordinate, and manage your investments? Is there overlap when you combine both of your portfolios? How will your asset allocation be impacted? Will you continue your automatic savings plans, how much, and where will it be invested? What decision process will you use to evaluate your investments?

PROPERTY & CASUALTY INSURANCE
Now is a good time to review your Property and Casualty Insurance coverages, multiple autos, homeowner’s, and an umbrella policy should be considered. Many insurers offer a multi-policy discount.

GENERAL
Have you changed your beneficiaries on your 401K, IRA’s and Life Insurance policies? Have you changed names and addresses on your accounts; DMV, Social Security, credit cards, bills, and bank accounts?
Are there other areas you can consolidate your finances and accounts?

LIFE INSURANCE
Have you reviewed your Life Insurance coverage? Is it adequate in light of your new circumstances? What type and how much should have are key points to discuss.

Good news, most of the hard work is behind you, now you can concentrate on the fun aspects of your new financial life together.
Worksheets mentioned in this article are available to you at no charge. Call (585) 720-0590 and we will gladly mail them to you. Visit our website for a variety of related articles and calculators that can help you answer many of the questions raised in this article at www.mmasiello.com.


MASIELLO & ASSOCIATES/Estate & Wealth Preservation Council, LLC 1777 English Road, Rochester, New York 14616
Securities Offered Through Multi-Financial Securities Corporation,
Member NASD, SIPC
Masiello & Associates/Estate & Wealth Preservation Council, LLC
& Multi-Financial Securities Corporation are not affiliated companies.

Written by Michael A. Masiello

© Wedding Planner 2004

This is the fourth article in a series designed to help you formulate a strategy for marriage and money. This article deals exclusively with insurance.

All insurance is based on minimizing risk and protecting against economic loss. Unfortunately, bad things happen to good people. Insurance is designed to transfer risk from you to an insurance company in exchange for money commonly called premiums.

LIFE INSURANCE-A SELFLESS GIFT OF LOVE
Often times, life insurance is one of your most misunderstood and underappreciated assets. As a general rule, you should have 5-10 times your income in life insurance protection. Dependant on your circumstances, family needs, income assets, etc. your need may be more or less than the rule. There are a number of “insurance need estimators” and calculators available at www.mmasiello.com.

On the surface, 5-10 times your income may seem like a lot of insurance/money, but let me show you this example. Assume you earn $30,000 per year; therefore you have $300,000 of death benefit. If your survivor invests the $300,000 and earns 5% per year and needs $24,000 per year to replace your income, he/she is broke in 20 years! Is that what you want?

Basically there are two types of life insurance: temporary/term, or permanent. Based on the length of your need, each may have a place in your protection portfolio.

TERM INSURANCE
is designed for short-term needs, up to 20 years, it is often referred to as rented insurance, just like renting an apartment, you build no equity with Term Insurance. It comes in a variety of flavors: 1 year renewable, 5, 10, 15, and 20 year level premiums. Term insurance – is pure death benefit, if you die and policy is in force, it pays. Term insurance does not build any cash value or equity.

Term insurance is ideally suited where there is a large need for protection but few dollars to pay the premium, i.e. to provide for family support through age 20 for a spouse and family.

PERMANENT INSURANCE
provides death benefit plus has cash value, or equity in the policy. Just like owning a house you build equity with every payment. There are three types of permanent insurance. Whole Life, Universal Life or Variable Universal Life. Each of these products, if properly funded, should provide cash value as a living benefit. Each of these policies applies a portion of your premium to the insurance and a portion to your equity. A detailed description of each of these types of permanent insurance is available but beyond the scope of this article.

Permanent Insurance is ideally suited for life long goals like spousal support, supplemental income, and estate planning.

Usually a combination of both types of insurance can provide a cost effective solution to meet your needs. Most couples and families will have a unique life insurance need based on their circumstances and philosophy.

DISABILITY INSURANCE- INCOME PROTECTION
This type of insurance is often ignored or taken lightly. Disability insurance protects you and your most important asset, your ability to work and earn an income.
Think about the negative impact of never working again! If you are targeting 70-80% of your current income for your retirement - what about for living? How long could you survive without one or both incomes? How? Who will replace the lost income?

Unfortunately disability can be a financial disaster for most couples and families. Medical expenses, inflation, and the every day costs of living continue with or without your income.
Most employer sponsored disability programs only provide 50% income replacement. Can you survive on a paycheck? If not, you need to address this area quickly.


MASIELLO & ASSOCIATES/Estate & Wealth Preservation Council, LLC 1777 English Road, Rochester, New York 14616
Securities Offered Through Multi-Financial Securities Corporation,
Member NASD, SIPC
Masiello & Associates/Estate & Wealth Preservation Council, LLC
& Multi-Financial Securities Corporation are not affiliated companies.

Written by Michael A. Masiello

© Wedding Planner 2004