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Newly Wed and New to Investing?

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Get honest with each other about money early on, and establish goals before it's too late. Here's how.

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If you're contemplating marriage, the time to talk about money is well before you say "I do." Getting married merges more than two lives. It also merges two financial balance sheets: By law, what's yours becomes his and what he owes, you do, too.

How you handle your money discussions can set the tone for communication in all other aspects of your relationship.

"Money is the number one reason for divorce," says Kathy Boyle, a certified financial planner and president of Chapin Hill Associates in New York. "While everyone wants to be married forever, the reality is over half of all marriages don't work out, so going in clear-eyed and checking to see if your money goals and styles are compatible is critical."

The problem for many couples? "We'll take our clothes off before we'll share our financial statements," says Barbara Stanny, a California-based financial adviser who specializes in women's money issues. "I think [talking about finances] is the ultimate in intimacy. It's a relationship-building tool."

Here's what experts suggest:

Practice Full Disclosure From the Start

Irina, a recent MBA graduate in her early 30s, decided to lay out her financial situation to a man she was dating, someone she felt was the one she would eventually marry. She was carrying a heavy debt burden at the time, stemming from both a mortgage on a New York City apartment and her Ivy League student loan, and she wanted to lay it all out on the table.

"I was concerned about how he would react when I told him the high number," she says. "I didn't think it would be fair for him to go in blind since it all becomes his responsibility as well," she says.

While her fiancée-to-be was "taken aback" by the mid-six-figure debt obligation, it didn't stand in the way of their relationship and the couple married in a black-tie wedding last August. While Irina hunts for a full-time job in a dismal job market, her husband has left his start-up company for the security of full-time corporate employment. They eventually want to start a family.

Linda Descano, president of Women & Co., a financial planning unit of Citi (C), says getting financially "naked" the way Irina did is the basis for financial harmony. Recent Women & Co. research involving affluent women across the country indicated they are increasingly the initiators of these conversations and 66% consider themselves the CFO of their homes.

When she was first married in her mid-20s, Descano says, she focused on building her career and handed her paycheck to her then-husband, which is how her parents handled things. It wasn't until she and her husband divorced 10 years later that she discovered they'd amassed a hefty credit card bill. Because her husband was in graduate school and she was the primary breadwinner, Descano inherited that debt as part of the divorce settlement. Lesson learned.

Nine year later on the night her second husband proposed, Descano says, he gave her his net worth, his most recent tax return, his W2, and a number of other financial documents. "It was one of the most romantic nights of my life," she recalls.

Indeed, the conversation should be romantic, says Stanny, who recommends finding a relaxed and romantic setting to open the kimono. She agrees that the time to have the conversation is when Irina did -- when the relationship feels like it's serious enough that an intermingling of finances may be coming. (For more, see How To Talk About Money.)
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