Getting married is a major life change. Unless you’re an accountant, though, you might not realize all the financial implications this new union brings. That’s why, in your future accounting career, it will be essential to keep on top of your clients’ life changes, like marriages, and what those changes mean for their finances.
The Financial Implications beyond the Cost of the Wedding
Even when your clients do consider finances, they’re more than likely thinking about the cost of the wedding itself rather than the things they need to consider both before and after the marriage takes place. After all, people know that wedding ceremonies and receptions can get expensive – that’s one reason studies have shown that 12 percent of adults surveyed are delaying marriage for financial reasons, Accounting Today reported.
While clients may come to you for advice on saving money for the wedding as one of their financial goals, they will also need your help with a number of other decisions – some of which they might not even know about, according to Accounting Today.
Marriages affect everything from insurance beneficiaries and coverage to wills and tax withholdings. Yet because these topics aren’t specific to marriage, they’re not top-of-mind for most brides- and grooms-to-be or most newlyweds.
You can help your clients review their insurance coverages and determine if the policy limits are enough at this new life stage, and make the necessary changes to beneficiary designations. If these clients already have wills and estate plans, they may need to update those documents to reflect the marriage.
You can also help your clients take a look at their income tax withholdings to determine which option is best for their situation. For some clients, it’s as easy as switching from “single” to “married,” while the choice might be more complicated for clients who are self-employed or otherwise need to withhold more money.
Living in the Present
A marriage typically means sharing of at least some property. Will your clients combine existing financial accounts or keep some (or all) of their money separate? You can help them decide by reviewing all of their financial accounts with them.
Besides organizing account titles, your clients may need your help adjusting to the reality of combining their finances. You can help them review balance sheets and create a budget that allows them to grow their savings, work toward reducing their debt and manage their spending wisely.
Planning for the Future
How will your clients invest their money? How will they save for retirement? It’s important that both individuals in the marriage are on the same page about where investments accounts are, how to access them, and how much they can contribute to a retirement account.
Marriage is just one of the many life changes accountants must help clients prepare for and adjust to. In your accounting career, you won’t just be working with numbers – you’ll work with people, too.