Merging finances with a partner is easy when you’re young. For most people in their twenties, combining assets is little more than deciding who gets the ratty futon if they break up. Maybe there’s a TV or bed in the mix, but probably not.

But as you age, you start to accrue stuff: property, cars, furniture and (hopefully) a significant retirement fund. And these types of significant assets are harder to split up. With the average age of marriage continuing to rise steadily, what happens when you need to merge finances in middle age? What about in your 60s, 70s or 80s?

It may not be as easy as sharing a tiny bank account and IKEA kitchenware, but merging finances in old age doesn’t have to be a chore. Here’s everything you need to know, and how to go about it – without ruining the marriage.

Merging Finances – How to Do It

  • Decide on a budget together. Merging finances becomes more complicated when both people have been living individually for years. Create a budget together instead of imposing your financial views on your partner. This act requires open communication and respect – qualities your marriage will need to survive the coming years. Deciding on your budget jointly will prevent fights about money, one of the top reasons for divorce.
  • Beware of debt. Debt accrued before marriage remains only one person’s liability, but any debt taken on after getting married becomes a problem for both parties. You’ll still be on the hook for an auto loan, even if you weren’t aware of your partner taking one out.
  • Add both names to your accounts and assets. Often, only the person listed on an account has access to it. This is important because if something happens to the account holder, their spouse won’t be able to access it unless their name is also listed. For instance, if you are the only one listed on the mortgage, your spouse may find himself suddenly homeless should you pass away unexpectedly.
  • Examine your retirement plans. Getting married in middle age means you’re much closer to retirement than a pair of newlyweds in their 20s. You may even be only a decade or two away from leaving the office for good. Sit down with a financial planner to see if you both have enough to retire when you want, or if you need to play catch-up. Also, you’ll want to discuss the type of lifestyle each of you want in retirement and plan accordingly.
  • List your beneficiaries clearly. Most financial accounts ask you to name a beneficiary when you create them. If you don’t name one, your assets will go to whomever your estate decides. But if you do, the money will go to that person, even if you specified different instructions in your will. These kinds of mistakes can hold up the probate process and strain relations between your surviving spouse and children. So make sure to name a beneficiary and then periodically review both your will and beneficiaries to make sure that they match.
  • Consult a lawyer about a will. Parents who have children from previous marriages often divide their assets between their children and current spouse. A lawyer can draft a will to ensure a smooth transition after your death. If you don’t draft one together, make sure your partner gets their own will written up as well.
  • Backup all your documents. Having paper copies of your IRA and life insurance forms might have been sufficient 30 years ago, but now electronic copies are more vital. Copies stored in the cloud, on a separate hard drive or with a lawyer ensure that a house fire or rogue virus won’t erase access to your 401k.

Consider the Alternative

Merging finances as you approach middle age becomes more and more complicated – especially if one or both parties have previous children or spouses. Fortunately, there’s no legal requirement to merge your finances, even if you get married.

“If folks have been divorced or experienced financial difficulty in a previous relationship, it may not make sense to combine everything,” said CFP and financial advisor Marguerita Cheng of Blue Ocean Global Wealth.

Cheng said that some of her clients create “yours, mine, and ours” buckets. For example, each party has access to money for discretionary spending, but also contributes part of their salary for bills and other joint expenses. This strategy allows both parties to have some financial independence while still sharing a fair amount.

If you decide to combine finances, strongly consider consulting a financial advisor. Getting married is hard enough without the turmoil of merging finances, but a financial advisor can ease the process. They can go through all your assets and determine the steps you and your spouse need to take.

For example, they can tell you if the beneficiary information on your retirement accounts needs to be changed, or if a change in the will is enough. They can also recommend tax accountants or lawyers to take care of other financial matters.


Zina Kumok

Zina Kumok

Zina Kumok is a personal finance freelance writer. Her work has been featured in Forbes, Learnvest and DailyWorth. She writes a blog about how to be mindful with your money. Follow Zina on Twitter and ConsciousCoins.com