It’s not just summer that is the busy season for weddings anymore—the fall wedding season has just begun, and it’s prudent for financial advisors to make sure that they are prepared with a comprehensive plan to assist clients getting ready to tie the knot.
Wealth management professionals should spend some time looking at the big picture—do the couple’s retirement goals align? Have all insurance policies and estate plans been updated?
Ideally, this process should start when the couple gets engaged. It’s important that an advisor takes the time to get to know their client’s spouse-to-be before creating a plan. Here’s a general checklist to make sure that wealth advisors can be prepared:
Take tally of each’s overall financial picture
Look at the couple’s financial holdings, insurance coverage, risk-tolerance levels, retirement goals, and estate plans individually. Some good questions to ask the couple—Who will pay bills? How will you both plan for big purchases? When do you want to retire? Where? If there are already children from previous marriages, how will inheritances be handled?
Does the other half of the couple already have a financial advisor?
If the other person in the couple does not already have a financial planner and wealth advisor, hopefully, they will sign on to work with you. If they already do, ask them to review all of their financial accounts to see how their asset allocation overlaps with your client’s particular holdings. It’s true that two advisors for one couple can get rather complicated, but eventually the couple will gravitate towards just one wealth manager.
This next step can be awkward.
Convince clients to get a pre-nuptial agreement
This is a pretty easy sell for clients who have been married before, but it’s not uncommon for younger clients without children to insist that they don’t need one. As a wealth manager, it’s crucial for advisors to attempt to take the emotion out of it for the clients who are convinced that they don’t need one.
It may also be wise for the couple to get separate lawyers—often spouses aren’t financially equal.
Whether your clients agree to a pre-nuptial or not, financial advisors should send the couple to an attorney that can help them update their estate plans—and remind them to go to that meeting with all of their financial statements and insurance coverage.
After the wedding, it’s important for financial planners to update their beneficiary information—include insurance and retirement plans. When clients change their name, advisors should help them update their social security card, credit cards, passports, etc.
Set up financial accounts
Do the newlyweds want to co-mingle financial accounts? If so, how much? Generally speaking, the fewer accounts, the better.
The best thing for wealth managers to do for clients who are coupling is to focus on the unromantic side of marriage. Clients get swept up in the idea of marriage being a romantic engagement, but it is important also to remember that it is also a business relationship between two people.