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In the Red Before You Wed? Talk Debt With Your Partner

Managing Money, Paying Off Debt, Personal Finance
Talk Debt With Your Partner, for Better or Worse

Commitment, shared goals and mutual understanding can provide a strong foundation for a marriage — and so can having your financial house in order.

With eight in 10 American households carrying some form of debt, such as credit card bills and student loans, according to a 2015 Pew Research report, it’s not surprising couples are carrying over this financial burden into wedded life.

Debt doesn’t have to a deal breaker when it comes to marriage. With some honest conversations, good planning and an understanding of how you’ll handle finances — individually and together — you can mitigate the challenge of debt and build a strong financial future.

Lay everything out

As a couple, it’s important to have a clear understanding of where each of you is financially. A good first step is to pull your credit reports, says Kitty Bressington, a certified financial planner based in Pittsford, New York.

“This helps couples identify the debt in a very noncommittal, no-blame kind of way,” Bressington says. “At this point, we’re not talking about budgets or eliminating debt.”

Look over the details of each other’s credit reports, including debts types, balances and any negative marks. Talk through what they mean and how they affect your overall financial picture.

Discussing this information can be awkward or difficult, but doing so now could save you a lot of heartache later.

“The couples that are successfully going to navigate this issue are the ones that … actually talk about it and come up with a plan,” Bressington says.

Know your goals — and how to tackle them

Next, discuss your broad financial goals and how debt affects those. For example, how could paying down debt free you up to buy a house, or save for retirement?

“Discuss your values around money, but make the conversation more goal-oriented and positive,” says Paula Levy, a licensed marriage and family therapist. “You two are trying to get somewhere and achieve something. Talk through where you see yourselves in one year, in five years, and establish a joint financial vision.”

Then figure out how you’ll resolve your debt. Will you tackle your individual debts on your own, or take them on together?

Consider different ways to resolve your debt:

  • DIY debt payoff: The debt snowball method — paying off smaller debts first to stay motivated — can keep you on track in the long run.
  • Consolidation: Balance transfer credit cards or a personal loan may help you consolidate multiple debts into one, ideally with a lower interest rate. You’ll likely need good credit to qualify.
  • Debt relief: Debt management plans from nonprofit credit counseling agencies or bankruptcy can help you resolve your overwhelming debts quickly and cost-effectively. Bankruptcy can stay on your credit report for seven to 10 years.

Know that you won’t be on the hook for debts your partner incurred before marriage. Once married, you are responsible for debt acquired under your name, and it will only affect the credit score of whoever incurred it. In community-property states (Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin), though, debts are divided between both parties in the event of death, divorce or annulment, regardless of who acquired them during the marriage.

Keep the conversation going

As you make progress on paying down your debt, check in with each other — keeping your long-term goals in mind — and course-correct where needed.

“‘Till death do you part’ is a long time,” says wealth psychology expert Kathleen Burns Kingsbury. She advises building flexibility into your plans and talking about your finances on a regular basis. “It could just be a 10- to 15-minute conversation so people don’t feel locked in.”

Follow your progress and look at the impact it’s having on your other financial goals. Paying off debt, like marriage itself, is often a long-term commitment.

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