Six financial planning tips for marriage

Planning for your special day? A wedding is a celebration of love and commitment, surrounded by family and friends. But they aren’t cheap - the average cost in the UK is now over £20,000. So, thinking ahead and making smart financial decisions can make all the difference.

To help you manage money effectively, check out our six expert tips for pre-marriage financial planning, as well as some guidance to help with your future financial life together.

Six financial planning tips for marriage

1. Plan a budget for the wedding

The first step of wedding planning should focus on how much you want your wedding to cost, how you’re going to pay for it, and how much you need to save prior to the wedding.

Having a robust wedding budget in place helps avoid overspending. It’s often in the wedding planner’s or event host’s interest to create your perfect day, but also to make it as expensive as possible. So, having a hard-stop on how much you’d like to spend will help give you an idea of how much to budget for each part of the wedding.

Next, you’ll need to think about how you’re going to pay for the wedding. Are you going to borrow money through financing? If so, what would the monthly repayments look like alongside your mortgage and other spending?

While it can be tempting to spend more to make your wedding day even more special, it’s not worth getting into financial difficulty and potentially adding stress to your relationship further down the line.

It’s important that you both have a say in what gets spent where to avoid arguments down the line about how one of you could have had a better day “if only we’d spent more money on…..”

Any money you’re putting aside for your wedding should be held in an easy access cash savings account, so it cannot fall in value, and withdrawn exactly when you need it. Cash savings platforms make it easy to manage your money and offer some of the best rates on the market.

2. Ask for help from parents or grandparents

If they can, family members typically want to make some sort of contribution to the big day. Dipping into the bank of mum and dad, or grandma and grandad, can be beneficial not only to help pay your wedding, but also to reduce their inheritance tax bill in later life.

Every tax year, it’s possible to make a tax-free gift to someone who is getting married or starting a civil partnership. You can give up to:

• £5,000 to a child

• £2,500 to a grandchild or great-grandchild
• £1,000 to any other person
  

3. Consider a pre-nup

4. Talk openly about your finances

Sitting down with your partner to gain a better understanding of each other’s financial position before you walk down the aisle can help to avoid any nasty surprises at a later date. Honesty is the best policy.

Discussing topics such as short-term debt (e.g. credit cards and bank overdrafts), long-term debt like student loans and bank loans, earnings and savings can help paint a clearer picture of your financial position once you start married life.

5. Know the financial benefits of marriage

Getting married can leave a big financial hole in your pocket, but after the wedding is paid for, there are certain financial advantages.

One of the main benefits is that spouses can transfer money and assets between themselves tax free, which can help to reduce your overall tax bill.

For example, if your spouse is a higher earner and you’re a basic tax rate payer, they could transfer any investments to you and benefit from paying less tax on any dividends as basic tax rate payers on taxed less.

The dividend allowance for the 2024/25 tax year is £500. Any further dividends will be tax at 8.75% for a basic rate tax payer, then at 33.75% or 39.35% for higher and additional taxpayers respectively.

6. Plan your future with a financial planner

A financial planner can help you develop a bespoke financial plan that not only covers your wedding, but also sets you up for a secure financial future.

Our experts can offer tailored advice to ensure your wedding spending aligns with your long-term financial goals, further emphasising the importance of a solid wedding budget plan.

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