Getting Engaged? Get Your Finances Sorted
There are a few conversations that should broach with your partner at this stage of life — such...
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Getting married and planning your life together is one of the most exciting times of your life. From the engagement, to the ceremony and beyond, it marks the point where your lives converge. Making such a big commitment to each other means you’ll want to make sure you have everything in place for a secure future, and in this section we’ll explain why it’s so important (and smart!) to sort your life insurance policy when you’re getting married.
Getting married has been such a big part of life for so many hundreds of years that there are plenty of beautiful and funny quotes about marriage, and if you’re planning a wedding there’s no doubt you’ve heard a few of them.
Martin Luther wrote in 1569 that “there is no more lovely, friendly and charming relationship, communion or company than a good marriage”, while in 1991 — almost 500 years later — relationship expert Daphne Rose Kingma declared that “weddings remind us that our lives have meaning and that love is the strongest bond, the happiest joy, and the loveliest healing we can ever experience”. It’s clear that across time, love and marriage has inspired and driven us, and if you’re planning your own wedding, you’ll want to do as much as possible to make sure it tops the list of your favourite life moments and paves the way for many more.
Along with the list of wedding preparations, getting married is all about preparing for a future together, and a fantastic way to do that is by putting in place great habits that will see you through the entirety of your married life. Setting up a savings account is one piece of advice you’ll often hear, and another is looking into a Life Insurance policy. The benefits of Life Insurance for newlyweds are numerous, and one bonus includes being able to lock down a good premium simply due to your age and good health. By having a policy as soon as you’re married, your future will be financially secure should something unexpected happen that might otherwise mean great monetary strain on the other partner.
By getting a policy from the start of your marriage, you’ve set in place good habits for a secure future from the start. And even though your life might drastically change from your wedding day, your policy can change with you. Many couples will add children to their family, which means that your costs will increase from the previous two person makeup. With the addition of kids to the mix, you can have your policy adjusted to ensure that a policy payout would adequately provide for your family, covering your earning power. Having a baby can change your priorities and make you more driven to provide a stable future than ever before, and making sure your policy has an ample payout will help give you peace of mind that you are.
If you already have a Life Insurance policy, then it’s important to remember to assess it after your wedding, including updating your will so it’s clear who the beneficiary should be. If you’re insured but your spouse is not, you should make a decision about whether they should also have a policy. Or if they’re the higher earner, perhaps discuss whether they should be insured instead of you. For two income households having both partners covered is a good idea, and this is especially true if you need both incomes to maintain your lifestyle. If one spouse earns while the other is in an unpaid role, such as a student or stay at home caregiver, you can decide whether to insure just the main earner, meaning your non-earning partner would be provided for in the event of death or illness, or to insure both, meaning the main earner would then be able to take a break from work should non-earning partner pass away.
Your policy can adapt to your many life changes, including in the event of a divorce. While it might seem quite bleak to chat death and divorce in a discussion about marriage, it’s important to know all your options, no matter how difficult to think about. Should your marriage dissolve, your policy can be changed to suit your new circumstance. This may mean changing it to provide coverage for a single adult, which could cover important costs such as funeral costs or any loans. Or it could also be changed to provide sufficient coverage for your children and their future.
Even if you and your partner both work, there could be a huge financial impact if one partner passed away or became ill. Building a life together can be an expensive and time-consuming endeavour, and you may have accumulated debt by buying new vehicles, property and other items. If your husband or wife was to pass away, the loss of their income could bring on serious financial struggles, even resulting in having to majorly change their life in order to adapt to their new circumstance. A Life Insurance policy offers a financial cushion in this time, and enables the partner left behind to comfortably pay off funeral costs, any medical bills, and also cover things such as mortgage and loan repayments. It could also be used as living expenses, particularly if time away from work or a business is needed in order to cope with the loss of a loved one.
If you and your partner have dependents, then the death of a parent will drastically change their future. While nothing can take away the grief and hardship of losing such an important part of their life, a policy payout offers the financial silver lining of a legacy that will seriously help your children. A payout could provide the means to remain in the family home, be used as payment for university fees, or perhaps even be the deposit for a home of their own. It’s incredibly difficult to think about not being there to see your children grow up, but in the case that that did happen, the peace of mind of having a policy in place is priceless.
Set Up Good Habits Early
Take advantage of your youth and good health by securing a good premium while you’re young. Having a policy as newlyweds means you’ll be creating responsible habits from the very start of your marriage.
Update Any Existing Policies
Married vs single Life Insurance looks a little different, so if you already have a Life Insurance policy, make sure you update it. You’ll need to make sure your coverage protects your earning power, especially if your household relies on two incomes. Also remember to update your will to make it clear where the payout should go.
Investigate Your Options
If you’re looking into Life Insurance for the first time, check your options. Decide if you want a policy for each of you, or if it would be more suitable to just cover the main earner. Do you rely on one income or both to maintain your lifestyle? Take your budget into consideration when checking if one or two policies would provide adequate coverage.
Change Your Policy As Your Family Grows
Your Life Insurance can adapt with you at all life stages, including adding children to your family. In this case you’ll need to remember to readjust your policy so that the payout is sufficient for your family size.
Adjust Your Policy If Your Situation Changes
If you and your spouse divorce or separate you’ll also need to make sure your policy works for your new situation. You may also want to change who would receive the policy’s payout, naming your children or another family member as the beneficiary in your will.
Update Your Will
An important thing to remember with each life change! A comprehensive and up-to-date will is the best way to make sure your final financial wishes are carried out. If you have specific wishes for how the payout should be used or allocated, lay this out in your will. The more specific you can be in your will, the easier it will be to avoid any issues for family members after your passing.
If you’re getting married and would like to know more about your Life Insurance options as a couple, give us a call and we’d be happy to explain your options.