When the Supreme Court recently ruled that the bank on same-sex marriages in 13 states was unconstitutional, many same sex couples will now face a different set of rules when it comes their overall financial plan. We have had specialists in this arena on our staff for years, but now is the time to really revisit the best way to be the CEO’s of your family finances. Here are five tips you may want to consider for your future.
- Revisit Your Group Benefits During Open Enrollment Season- More than 50% of U.S. employers offers employees the opportunity to buy life insurance on their spouse through the company group policy. This is really good news for same sex legally married couples as long as the group policy is covered underneath the federal Employee Retirement Income Security Act (ERISA). You should revisit your personal insurance situation and the best way to maximize your coverage while minimizing your cost for your family.
- Prepare For The Cost Of Children- Like any family, it is important to build up a war chest of funds before you start having children. With the average child costing more than $250,000 to raise for an average income family (without the college costs), determining how you will be able to afford children financially is a topic more and more same sex couples will be facing in the upcoming years.
- Open Up About The Family Balance Sheet- Who has what credit card debt? How many credit cards does each one of you have? What bank accounts will you make joint and what ones will you leave as they are today? Who will pay the family bills? Same sex couples face many of the same financial planning issues wondering the best way to build out a family budget. If you are truly merging your finances at this point, how can each of you have full and fair disclosure?
- Prepare For Filing A Joint Tax Return- Now that same-sex marriages are recognized for federal tax purposes, you must decide whether you file married joint or married separate. Your choices will truly be affected by your exemptions, deductions, IRA contributions, and other eligibility for tax credits. You may even face something called the “marriage penalty” which your combined tax bill may actually go up. It is a great time to create a sample tax return for this year and figure out what you can do to save money in taxes before the end of 2015.
- Building Joint Goals- Many couples never take the time to discuss their financial goals and objectives, which often causes a lot of strife on the home front. You may now have new decisions to make around beneficiary designations, pension options, and what you might do with social security in the future. It’s an important time to lay out your short, medium, and long term financial goals so you know exactly what you need to do as a family.
These are just five quick tips we have for you, but there are many more when you come see us for a meeting.