Marriage & Money: What You Should Know

Tax time can tax even the strongest marriages, but newlyweds Brad and Drew Erb, who took their vows last October, should be feeling particularly in love as April 15 approaches. Over the past six months, the couple has done nearly everything possible to avoid the kind of financial conflicts that often lead to nasty fights between husbands and wives: they combined their checking and investment accounts, made each other beneficiaries of their respective 401(k)s and are bumping up their life insurance. Brad, who is now on his wife's medical plan, saves a few hundred dollars a month. Even better, filing a joint tax return this year gave them a 15 percent higher refund. "Our situation is probably luckier than a lot of people's," says Brad, a Winter Park, Fla.-based financial adviser for Edward Jones.

He's right. All over the country, freshly married couples, confronting that cold 1040 "EZ" form for the first time together, are finding out the hard way that when it comes to marital stress, sex has nothing on money. "Money is the last taboo," says Olivia Mellan, a psychotherapist and author of "Money Harmony: Resolving Money Conflicts in Your Life and Relationships." "Money is never about money. It's about love, power, security, control, old age, self-esteem, freedom, independence." That, financial advisers say, is why squabbling over finances tops the list of reasons couples divorce.

So how can married couples—or those about to get hitched—keep money worries from ruining their love lives? The quick answer is that old cliché: communication. Preferably the brutally honest type. It may not be easy to come clean about your financial shortcomings. But your mate will find out sooner or later—probably when you're sitting down to do your taxes—and if it's later, it's going to get ugly. Now's the time to exercise that "better or worse" clause in your wedding vows. What's your real income—not your "dating inflated" version? How much debt do you really have on those credit cards? Does the repo man carry your picture in his wallet? With marriage and money, advisers warn, ignorance is definitely not bliss.

That's advice Amie Provencher and James Schiffner, who just tied the knot, are determined to take to heart. The two met online three years ago through eHarmony, the matchmaking Web site. Provencher and Schiffner are like-minded about a lot things, but it's hard to imagine that money is one of them. Like the cobbler whose children have holes in their shoes, Provencher is a finance manager who, by her own admission, "hates bills." Schiffner, 38, a computer security analyst, doesn't. "We actually have really different philosophies. He pays a bill as soon as he gets it. I don't," Provencher says. Both are "addicted" to their chiropractor (not cheap) and like to go out for sushi dinners at least once a week. But while Provencher will spend $200 on a haircut and has a newfound fondness for pricey moisturizers (she recently turned 40), Schiffner spends almost nothing on grooming.

That may not seem like such a big deal; but month after month the differences can add up. Financial adviser Suze Orman urges people to pay close attention to little clues like these before they decide to walk down the aisle. Does your boyfriend over-tip at restaurants, even though he has credit-card debt? Orman says that may mean he doesn't respect his money and will take the same approach to yours.

Provencher and Schiffner are evolving. She says he has helped raise her money consciousness. "James came into the relationship clean, with no debt and a really high credit score. He's enabled me to get in pretty good financial shape." Provencher's willingness to change is a good sign, says Orman, whose latest book, "Women & Money," urges women to confront money fears instilled in them by a historically patriarchal society. If Orman had her way, people with poor credit ratings (known in the business as FICO scores) wouldn't be allowed to get married until they demonstrated at least two years of steady financial improvement. "There's exceptions to every rule," Orman says, "but I always say, FICO first, then sex." Orman believes that when spouses have very different credit ratings, it often means trouble down the road. Consider the consequences, she says, of buying a house with your credit-challenged spouse. Your mortgage rate will likely be based on the lower credit score—or, at best, an average of the two. That means more debt and higher monthly payments, not the sort of thing you want to find out for the first time when you sit down with the mortgage broker. "You have to be able to address things beforehand," Orman says. "Everything."

Of course, as long as opposites attract, spendthrifts will couple with hoarders—and people like Ruth Hayden, a St. Paul, Minn.-based financial consultant, will have clients. The author of "For Richer, Not Poorer: The Money Book for Couples," Hayden says the key to marital happiness is compromise. "What I teach to my couples is that 30 percent of their challenges will actually be resolved. The other 70 percent have to be managed." Brad and Drew Erb have some things to work out. Brad's father, a university professor, grew up in a Mennonite household where frugality was next to godliness. "Our parents never made a whole lot of money, but they were always conscientious about living below their means," says Brad, 33. "Debt makes my skin crawl."

Drew, 28, says her kin couldn't be more different. They're "the classic American family where credit cards rule everything." The first in her family to go to college, Drew says her parents "wanted to help me but their attitude was, 'Get loans and we'll help you pay it back'." During college and afterward, while working as a horticulturist, Drew amassed lots of credit-card debt. But when she and Brad got engaged, she decided to get serious about her finances. She quit horticulture and took a higher-paying job as an office manager. "I felt that I wasn't contributing very much to our marriage and that Brad would be bearing the brunt of it." So far, the couple, who live in the house Brad bought before they met, can think of only one real splurge: new furniture. Since they got engaged, they have been able to pay down about half of Drew's debt.

Another secret to avoiding financial stress: deciding together if one spouse is going to stop working to stay home with the kids. Married last June, Filipa and Eric Bryson moved from her hometown in New York state to her husband's in Rhode Island. She left behind her job as an elementary-school teacher. She thought she'd find a new job, but after giving birth to their son she had a change of heart. Surprisingly, she loves being a stay-at-home mom. "Now it's all about, 'Can we afford for me to stay home?' " Filipa says. "I never thought I would be like that."

For the Brysons, the decision has worked out well, because they both agree it's what they want for their family. For young couples trying to make every dollar count, it's especially important to map out short-and long-term savings goals. Amie Provencher and James Schiffner already do this. They both plan to start saving for a house, and would like to have a rainy-day fund. But first, Provencher has to finish paying off her student loans and old credit-card debt. Schiffner, meanwhile, has his own debt to retire. He splurged and bought Provencher's $10,000 engagement ring on credit. "The way to save money for a home is to just save money," he says. "And we're not there yet." The important thing is, they're "not there" together.