The cornerstone of a married couple’s joint financial planning.
Conflict over money is one of the leading causes of divorce. This is hardly surprising since so many of us embark on the adventure called married life without properly canvassing with our soul mates their personal financial philosophies, goals, aspirations, hopes and fears.
Here are a few things to think about:
- Spouses are treated differently for tax purposes in a number of respects (Estate Duty, CGT, donations and transfer duty).
- A spouse may have a claim for maintenance against your deceased estate – for example, if you fail to make adequate provision for your spouse in your will.
- If you die without a will, a spouse automatically qualifies as an intestate heir.
- If you get married in community of property, your estates will be combined to form a single joint estate shared by the two of you. You will each have an equal undivided share in the estate, and in each of the assets comprising the estate. Your respective debts are also all going to be shared. Creditors of either of you will be creditors of both of you. Should one of you be sequestrated, the other will also be sequestrated and you will both acquire the status of an insolvent. When the marriage ends (whether by death or divorce) the joint estate will have to be divided equally between the two of you.
- If you are married out of community of property (which means that you will have concluded an Antenuptial Contract BEFORE getting married) then there is always the possibility of an accrual claim when the marriage comes to an end (whether by divorce or death). This needs to be taken into account, for example, when drafting your will.
The moral of the story is that you and your betrothed would be well advised to have a full and frank discussion with one another – before getting married. Discuss money, how you feel about it, what you want to do with it, and how you are going to manage it.
Should you decide to get married out of community of property, then your ANC will provide an important cornerstone in your joint financial planning as a couple. It also provides a great opportunity to talk about things like:
- How joint living expenses are going to be paid.
- Whether you are going to retain separate bank accounts, or share a joint one (or a combination of both).
- What your respective views are on having children.
- Whether you both intend to work during the marriage.
- And lots more.