Your Money & You - Part One - LOVE
I've been doing a series this week with CBC's RadioActive on your money and you. Welcome to part one of the series - LOVE! Does love and money mix? Listen here to the audio of the piece.
Whether you're single, married, divorcing or co-habitating - it all involves money. Let's start with the biggie - marriage and what's the most important things people need to keep in mind?Wedding Cost
The cost of a wedding can average anywhere between $20,000 and $30,000 - and that's just the average! That's a big bill to start out with. Imagine if a young couple started out with that in an RRSP growing for decades! I know, I sound like the anti-Cupid, but I know so many couples that started out deep in debt and didn't even enjoy their big day.
Consider scaling back wedding costs (remember love and marriage - not just the big day). Eloping might be a great option or get your social network involved and see how many freebees you can get or barter your way to no-cost goods and services.
Costs to consider outside of the wedding
Because many individuals are getting married later in life, often times one or both spouses already purchased a home. Figuring out which home to sell, which to keep or getting a new spread together can be difficult and costly if you're selling or buying at the wrong time. Planning is key and involve the pro's to help with the financial, legal and at times, emotional decisions.
What about common-law?
It's certainly an accepted alternative in today's society. However, my concern is that many couples may be living together, wisely saving on expenses, but never thinking of their commitment long-term. After all, that's why they haven't tied the knot. But blindly living together without a clear conversation and better yet, a co-habitation agreement, can be dangerous. What happens if you want to split up? If you both own the dwelling you live in, what happens then? What about the "stuff" - furniture and more? And what if one person passes away? Even if you've lived together for many years (say as a renter), will the family just take over?
If you find yourself living with another person that you deem a common-law relationship, consider other financial issues such as government benefits, pension, income splitting and beneficiary issues. When in doubt, give your lawyer a call.
The Down Side of Love
Yes, the dreaded D word that's unfortunately a reality for far too many couples. What's the cost of that?
A recent study in Alberta had respondents reporting the average costs for divorce were:
-Uncontested Divorce $1,740
-Contested divorce $23,730
-Separation Agreement $2,500
-Child Custody and Support $15,950
And that doesn't factor in the division of assets, allimony and more.
If you and your spouse are able to talk and work it out without the extreme cost of the courts and a lawyer, you might be able to do it yourself with www.untietheknot.ca.
To give you an idea of the DIY divorce route costs, the price tag in Alberta for example is $249.00 plus GST and court filing fees of $210.00 and $195.00 plus HST and court filing fees of $447.00 in Ontario, but they offer services across Canada.
Check back soon for part two of this series - the cost of learning!
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Kelley Keehn is a personal finance expert and author of seven books, including The Money Book for Everyone Else. For more information, visit www.kelleykeehn.com.
Do you have a money question? Drop Kelley a line at firstname.lastname@example.org