As I write this the wedding of Britain's Prince William and Kate Middleton is under way. They will probably be too busy for the next few days to read this post, but eventually I'm sure things will settle back down for them and they'll get back to walking the dog, making coffee, taking the car for an oil change, and dealing with personal finance.
Like any newlywed couple, William and Kate should pause and give thought to a few financial "housekeeping" matters:
- I don't know if princes get a 401k plan as part of their benefit package, but newlyweds who have retirement plans should consider a review of their beneficiaries. It is easy to make changes, signing a form will generally do the trick. Generally you must name your spouse as beneficiary unless your spouse signs a waiver. So if you want to name someone else - generally a child, not an old flame - you'll need a signature (notarized) from your betrothed.
- Income taxes might need attention. Where a couple has similar incomes there should not be big changes from joint filing. But you don't have to be a royal/commoner couple to have very different incomes, and if you do, look out. Regular tax withholding is calculated as if that job was your only income. So when the new couple files their income tax they may find that too little was withheld from the paycheck of one of them, resulting a large balance due. Ask your tax advisor how to adjust your withholdings to avoid this.
- Do they need life insurance? Every couple's answer to this is different. But if they plan to start a family, or if a new prince or princess wants to be kept in the new lifestyle in the event of the unthinkable, a conversation about insurance is worthwhile.
- The new couple should pay attention to their spending. There can be a tendency to splurge on nuptials, honeymoon, and there may be relocating of households and shopping for furniture. One hopes they will not take on credit card debt to get them through their happy time.
(This article contains the current opinions of the author but not necessarily those of Brighton Securities Corp. The author's opinions are subject to change without notice. This blog post is for informational purposes only. Forecasts, estimates, and certain information contained herein should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. References to specific securities and their issuers are for illustrative purposes only and are not intended and should not be interpreted as recommendations to purchase or sell such securities).