Often when people think of getting married, they think of being in love and spending the rest of their lives together. The thought of starting a family is on the minds of those who are getting married while they are young. At times, it seems as if the entire future will change and will change for the better. Others have already been married and have gone through a divorce. They may see marriage much different from a younger couple contemplating marriage for the first time. Regardless of whether you are thinking about marriage for the first time or a second marriage, the financial benefits for marriage need to be considered. The benefits of marriage are numerous, and a complete listing is outside the scope of this article. However, the following are a few that stand out among the financial benefits of marriage.
If one person does not have medical insurance but the other does, it is possible to add a spouse to the insurance policy. Healthcare costs can be tremendously expensive and is one of the leading reasons for bankruptcy. Health insurance through your spouse can mean the difference between losing all of your assets or remaining solvent. If both people already have insurance, the person with the policy having less coverage can switch to their partner’s policy. If both people are working and have medical coverage, then they are both protected if one of them were to lose their job. The unemployed person can simply be added to the other person’s policy
Pooling money to invest in the future
Married couples can combine their incomes to save for a major purchase such as a house. Married couples are more likely to buy a house than two people who simply cohabitate. Marriage is a legal commitment, and a couple is more likely to have confidence in each other because of the marriage.
If you listen to most people, you would think that taxes go up when you get married. In fact, it even has a name. It is called the marriage penalty, and it is true that certain couples when they marry will experience higher taxes when both incomes are combined. However, this is only true when both people have high incomes. The truth is, if one person has a high income and the other a low income, there is a likelihood that the lower income will result in a lower tax bracket for the couple. If only one person is working and the other has no income at all, the non-working spouse becomes a tax shelter, and the financial benefits are great.
Advantages in saving for retirement
Even though it may not be possible for a person to contribute to an individual retirement account because of a low income, once this person gets married the incomes of both spouses are combined. A contribution may now be possible. In fact, the contribution limits are raised; therefore, the tax break is greater.
Whatever your motivations for marriage are, it is the financial benefits than are critical. There is nothing wrong with being in love, but the practical aspects of marriage are financial, and for many people, it is the financial benefits that are felt by a couple everyday they are married.