Have you wondered about the benefits of marriage? Why do people see marriage as a natural next step with their partners compared to other options?
Love doesn’t always lead to marriage, but it is one of the most popular options for big relationship steps.
Civil unions may be of interest if you’re so-so on marriage, but think of the perks before you decide! Civil unions don’t provide you with the legal protection you may want later in your partnership.
In this article, we’ll take a look at 13 legal and financial benefits of marriage that you should know about before getting married.
Legal Benefits Of Marriage
To start things off, you can avoid many legal issues by putting some rings on your fingers.
1. Medical Decisions
Having someone you trust to make health care decisions for you is vital in any medical situation but especially in emergencies. When making health decisions, couples who are married have an essential advantage.
They have a stronger legal connection, which allows the spouse to take charge of the other’s medical decisions if they become incapacitated.
If one spouse becomes incapacitated, the other spouse has the legal right to decide on their behalf, including decisions about healthcare, end-of-life care, and more.
A spouse is automatically considered to be next of kin which is a critical advantage in a time of crisis when you need someone you trust to make tough decisions for you.
Not only that, if you pass away, your surviving partner isn’t able to make decisions about your body or estate if you aren’t married, so it’s another reason to go for it.
What’s going to happen to your belongings if you die? For some people, the idea of a will may also be a bit scary.
If you die without a will and no spouse, the state will decide who inherits your estate, leading to family disputes and costly legal battles. Having a will in place can prevent all of this from happening.
Most couples don’t think about what will happen to their belongings after they die, especially those who inherit their entire estate.
Inheritance is one of the key legal benefits. When a person dies, their estate is distributed among their heirs. A spouse is automatically considered an heir, which means they will inherit a portion of their spouse’s estate.
This can be especially important if you have a large estate. Your spouse will be able to inherit it without having to go through a long and complicated legal process.
3. Leave Coverage
Taking leave from your job to care for a family member is often seen as a commendable act, but what about when that family member is a spouse?
In the United States, under the Family and Medical Leave Act, married couples can take leave from their jobs to care for one another or handle the loss of partners. They can take up to 12 weeks of unpaid leave to care for an ill spouse.
Married people can take time off work to care for one another without worrying about losing their job or income.
Bereavement leave is still up in the air with the U.S. and not always part of your employment benefits- if your spouse dies, most companies will give you 3 days, but it isn’t guaranteed.
4. Paternity Laws
Paternity laws ensure that both parents are considered legal parents of the child, giving both parents rights and responsibilities to the child, including visitation, custody, and child support.
It also allows both parents to be involved in the child’s life and make decisions about their care. Paternity laws also ensure that the child has access to both parents’ medical history and insurance.
Paternity laws are different in every state, so make sure you familiarize yourself with the laws in your state.
5. Prenuptial Agreements
A prenuptial agreement is a contract signed by couples before they are married that outlines what will happen to their assets if there is a divorce.
Prenuptial agreements protect both parties to the couple’s interests in a divorce, such as:
- A prenuptial agreement can help protect spouses and community property from joint debts.
- It can help ensure that each person keeps their own property in a divorce.
- The agreement can help prevent disagreements over who gets the marital assets in a divorce.
- A prenuptial agreement can make the divorce process more straightforward and less contentious (supposedly).
- It can also set up an agreement for spousal support if there is a divorce.
6. Shared Health Insurance
It is often much cheaper to have health insurance through a spouse’s employer than separate insurance through your employment benefits. It’s both a legal benefit and an important financial perk too!
Once you are married, you will need to decide which health insurance plan to enroll in. You generally have 60 days to decide after you are married.
Suppose you are enrolled in government benefits with the Affordable Care Act before marriage. In that case, you may lose your coverage when you get married because your spouse’s income will now be used to determine eligibility. You’ll have to consider enrolling in your spouse’s health insurance plan instead.
IMPORTANT: During the pandemic in 2021, the American Rescue Plan Act of 2021 became law. It allows for a “temporary increase in premium tax credits for all income brackets” beginning in 2021 and going into 2022.
7 Financial Benefits Of Marriage
Did you know couples who have a successful marriage are less likely to go bankrupt?
By knowing what to expect and some of the financial perks of marriage, you can be better prepared to begin building a solid financial future together and avoid fights about money.
1. Cheaper Insurance
When two people get married, they become what’s called a “family unit,” so the cost of their health insurance and other policies can be averaged together and then discounted.
The savings on your car insurance alone could be substantial; we’ve saved so much on shared policies! Separate policies don’t make sense if you’re trying to be savvy.
Insurance rates are usually cheaper for married individuals. Homeowners’ insurance, auto insurance, and renter’s insurance are cheaper with multi-policy discounts, and the credit scores for married people are often better.
2. Build Better Credit (Joint Credit Cards)
You know that your credit score is a critical measure of your financial health as an individual. But did you know that once you get married, it also reflects the financial health of the married couple?
It does! Once you get married, you get what’s called a “joint credit file,” which means that your credit score is now a reflection of both you and your spouse.
And if one of you has a low credit score, it can drag the other’s score down as well. You may want to use Credit Karma now to get free credit score reports, which will let you know if your score will negatively affect your partner.
But there are ways to build your credit score together as a team. One of the best ways is by opening up a joint credit card account and using it responsibly.
3. Better Interest Rates (Combined Credit!)
When you combine your finances, you increase the combined incomes you have to borrow against, which can help you get a better interest rate on your loans, mortgages, and other credit products.
You can even have access to a larger loan than unmarried couples since you have two incomes and credit scores to boost your backing.
Don’t forget that it isn’t only income that lenders look at when deciding your credit. They also look at your debt-to-income ratio or the amount of debt you have combined compared to the combined amount of income you earn each month. The lower your debt-to-income ratio, the better!
If one of you owes a lot of money on student loans, for example, it could bring down the couple’s debt-to-income ratio and hurt your chances of getting a reasonable interest rate.
But if you can prove that you are a low-risk borrower – by having a high credit score, for example – you may be able to get a better interest rate than you would if you applied for a loan as an individual.
4. Tax Breaks
One of the marriage benefits is the tax benefits to save on taxes.
Couples who are married can file their taxes jointly, resulting in a lower tax bill because married couples filing jointly are taxed at a lower rate than singles.
You can do a few things to maximize your tax savings.
First, make sure you file your taxes with the marital status of “married couples filing jointly.”
Second, make sure you claim all the tax deductions and credits you qualify for. And third, make sure you have a good tax plan in place. A good tax plan can help you save even more on taxes and avoid a tax penalty.
A tax shelter is a common benefit of marriage. A married couple can save money on taxes by taking advantage of special tax benefits available only to a married couple.
5. More Retirement Options- IRA Benefits
When it comes to retirement planning, a married couple has more options than an individual. As a couple, you can combine your retirement accounts and save more money that way.
There are also several tax-advantaged investment options available to a married couple. For example, the husband and wife can each contribute to an individual retirement account (IRA) and a spousal IRA.
They can also invest in a spousal Roth IRA, which allows the spouse with the lower income to contribute more money than would be allowed if they were investing in an individual Roth IRA.
Are you interested in investing in your retirement? Open an account with Betterment, one of the leading Robo-advisor platforms.
6. Doubled Social Security Benefits
Social security benefits are an essential benefit of marriage. When you get married, you and your spouse become eligible for social security benefits to help you retire with more money.
Let me explain how it works: When you both retire, you will each receive social security benefits based on your work record.
However, since the Social Security Administration provides breaks that favor marriage, you will also receive a 50% bonus on your spouse’s social security benefit.
If your spouse has a higher social security benefit than you, you will receive a larger social security payment each month. This is a valuable benefit, especially if one spouse earns a higher income than the other.
In addition, social security benefits are not just for retired couples. They can also help when one spouse passes. Survivor benefits help the surviving spouse cover the costs of raising children.
Social security benefits can be a vital source of financial support during retirement or in times of need.
7. Joint Bank Accounts
When people get married, they often open a joint bank account. A joint bank account is a great way to manage their finances together. It can help simplify the process of paying bills and sharing expenses. Plus, it can be a great way to save money for joint goals.
Some of these benefits of a joint bank account include:
- Both spouses have access to the funds in the account.
- Each spouse can deposit money into the account.
- The account can be used to pay bills or expenses for the household.
- Both spouses are responsible for the account.
- The account can be used to save money for joint expenses, such as a down payment on a house or a trip together.
- Each partner has access to the funds in case one of them becomes sick or hurt and needs immediate help.
But Don’t Forget Other Benefits
While there are a lot of financial and legal benefits to getting married, don’t forget about the emotional and health benefits of marriage.
Marriage can provide a sense of security and stability and improve your mental and physical health.
When people decide to marry, they also agree to embark on a life-long journey together. but it’s a commitment of epic proportions.
This commitment is not just about staying together during good times but also supporting each other through the bad. As anyone married can attest, marriage comes with emotional support.
Married couples also tend to be more supportive of each other emotionally and physically, leading to a stronger relationship. Knowing someone has your back can be a great feeling, which is one of the main benefits of marriage.
Most couples have a love language, which communicates and gives love to your partner. There are five love languages:
- Words of affirmation – Words can be as simple as marriage quotes telling your partner that you love them and appreciate them.
- Quality time – Spending time with your partner is a great way to show them you care.
- Receiving gifts – Giving your partner a gift shows that you were thinking of them and want to make them happy.
- Acts of service – Doing things for your partner, such as doing the dishes or taking the dog for a walk, is a great way to show your love.
- Physical touch – This means physically touching your partner lovingly, not necessarily sex, but even hugging or hand-holding can communicate feelings powerfully.
Marriage also provides a sense of identity and belonging, plus social support. Spouses often feel like they are a part of something larger than themselves.
Marriage also provides a sense of stability in one’s life. This stability can be especially beneficial during difficult times, as it can help couples get through tough times together.
A happy marriage also has several physical benefits. Chief among these is that married couples tend to live longer.
People who are married have someone to look out for them and support them emotionally and physically. Married people tend to have a lower risk of heart disease, cancer, and stroke.
Marriage also offers financial stability, which can be essential for maintaining good health, as not being to afford your essential nutrients or checkups can deteriorate your body.
An essential factor in maintaining good health is a stable financial situation. The financial freedom that comes with having a stable financial situation allows people to see a doctor when they need to, get the medication they need, and eat healthy foods.
Marriage may not always be easy, it isn’t always smooth and sometimes we need help in the rough patches.
But with commitment from both partners, this union has endless potential rewards!
Marriage is an excellent decision for many reasons, including financial reasons and legal benefits. However, marriage also provides emotional and health benefits that are important for everyone to live to the fullest.
Some of the key financial and legal benefits of marriage are tax advantages, doubled social security benefits, joint bank accounts, and insurance perks such as reduced health and auto insurance rates.