Are you getting married soon? Congratulations! There are many benefits of matrimony in store for you. For example, according to one researcher, "In virtually every way that social scientists can measure, married people do much better than the unmarried or divorced: They live longer, healthier, happier, sexier, and more affluent lives."
Let's focus on the affluent part -- because there are many financial benefits to being married. Here are seven important ones.
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1. You can save money on housing
Consider housing, for example. Before you and your betrothed marry, you may be living separately, each paying rent or making mortgage payments on a separate home. When you come together under one roof, there will only be one home to pay for -- and that can save you a lot.
You'll also likely be paying less, in total, for expenses such as home insurance, property taxes, maintenance, repairs, and upkeep. Be careful, though -- there's also the chance that you'll spend a lot setting up a new home together, so plan to keep that in check and only spend reasonable sums, given your financial situation.
2. You can save money on health insurance
Then there's health insurance. If you are each covered by your separate employers' health insurance plans, you might save some money if one of you switches to the other one's plan. If one of you is self-employed or not working and has been paying full freight for health insurance, getting to be included on your spouse's plan can make a huge difference.
When there's a choice to be made about which plan to go with, be sure to compare more than just the costs -- look into what's covered and what you'll likely pay for the care you expect to need. Note, too, that the window to enroll in another plan may be narrow -- look into it and don't be late.
3. You can save money on taxes
Marriage can benefit couples tax-wise, too. Most will find that it makes the most sense to file a joint tax return -- though a minority will be better off filing separately. (Crunch the numbers or consult a tax pro to see which is best for you.)
Married people can qualify for higher income thresholds, tax deductions, and tax credits. Here's one powerful example: When you sell a home as a single person, there's a home sale exclusion of up to $250,000 available. For a couple, it goes up to $500,000. So selling a home with a big gain, such as $350,000, can mean that a couple pays no tax on the gain, while a single person would be taxed on $100,000 of the gain.
4. You can save more in certain retirement accounts
If you're single without earned income, you're often out of luck when it comes to contributing to retirement accounts such as IRAs. But if you're married without income, there's a spousal IRA available to you, allowing you to fund an IRA with contributions from your spouse's income.
Here's another strategy: If you and your new spouse are each contributing to 401(k) accounts at your jobs, compare the matching funds that your employers offer. If your employer will contribute up to 5% of your income and your spouse's employer will contribute up to 3% -- and you can't contribute enough to both plans to collect all those free dollars -- be sure to grab all the available matching funds from your employer first.
You can both make investment decisions together, or one spouse might defer to the savvier spouse -- which may well be the woman in a relationship as, contrary to some stereotypes, women are often the best investors.
5. It can be easier to borrow money
You may benefit when it comes to borrowing money, too. Your credit score won't be averaged with your spouse's when you marry, but their credit score, if it's higher than yours, can help you qualify for better deals if they co-sign an application.
Also, since lenders look at how much you make and how much you owe when making lending decisions, if you marry someone who increases your joint income while not increasing total debt, you'll be in a better position to borrow and/or you might qualify for a larger loan. That can help the two of you snag a better home than you could have gotten on your own.
6. You can save money on insurance
There are insurance benefits, too. For example, car insurance policies will generally charge lower overall premiums to married folks -- in part because they're viewed as more financially stable and perhaps more responsible, too. Many insurers offer multi-car or multi-policy discounts, so the two of you may also be able to take advantage of those benefits as there will likely be more cars in the household.
Life insurance is a consideration for married people, and it's important to buy it if anyone is depending on you financially, as a spouse or children might.
7. You can reap Social Security benefits
Social Security offers benefits to married people, too. For starters, if your spouse's Social Security benefit is much bigger than yours, you may want to claim a spousal benefit, which can give you up to 50% of your spouse's benefit.
If you divorce after at least 10 years of marriage and haven't remarried, you can claim your ex's benefits instead of your own, if they're higher. (Your ex will still collect their benefit, too.) Widows and widowers can also qualify for Social Security benefits based on their late spouse's earnings.
These are just some of the many financial benefits of marriage. A little digging will turn up more. Note, too, that there are upsides and downsides to completely merging your finances -- so learn more about that before you decide that issue.
