One of the leading reasons why couples seek marriage counseling and ultimately divorce is because of financial issues, including disagreements as to how to handle debt and differing spending habits.
Financial issues are a huge source of stress for so many. Contrasting spending styles, or simply not having enough money to go around each month, does, indeed, often push a couple to the brink of divorce.
Financial issues can follow you into divorce and even beyond.
You may even be expected to help assume some of the burden of your spouse’s financial mess in the event that you do divorce. Your ex-partner’s bad credit can impact how you are treated, causing your own interest rates to be higher. Some couples choose to put assets in the name of the spouse with better credit, but, in the event that they divorce, that spouse is sometimes left with either a greater amount of debt responsibility, or little means to force the other to pay the debt for which he is held responsible.
With financial issues so common a cause of marital discord and divorce, finances should be a high priority on the list of discussions to have with your partner before getting married. But people don’t do this. Why not? What financial questions should you ask before you say, “I do”? What issues should you discuss? How should you start the conversation?
While the conversation about financial issues may not be an easy one to have, it is crucial to have it. To broach the sensitive subject, set aside a time when neither of you is emotionally charged. Set the stage for a positive conversation, possibly over dinner or appetizers with calm music playing. Your conversation should be informative, rather than accusatory. Explain to your significant other that, because you both work hard in your careers, it is important that you each understand what the other expects financially in your marriage. You might even explain that you know that financial issues cause many divorces and you want to start your relationship on the right foot.
Ask that your partner prepare for the meeting by bringing a list of her own questions.
The conversation should be an open dialogue, rather than a one-sided conversation. Some questions you might explore together follow:
a. How much do you each earn each year?
b. What are your typical monthly expenses?
c. What’s your FICO score?
d. Have you ever filed for bankruptcy, or gone through a short sale of foreclosure?
e. How many credit cards do you each have?
f. Are either of you behind in any of your credit card payments?
g. How much debt do you each carry at any given time?
h. How often do you like to eat out? How much do you spend when you do?
i. How much do you each spend on clothes each year?
j. Do either of you have any expensive hobbies?
k. Once married, do you expect to join your finances together? If not, why not?
l. Are there certain assets either of you would like to keep separate once married?
m. Do you expect to enter into a prenuptial agreement?
What happens if your partner doesn’t respond to these questions as you would hope?
Is your marriage doomed? Possibly not. Next, find out if your loved one is willing to work to improve his financial situation. Is he open to seeking assistance to bring his finances in order? Is he open to financial coaching? Is he open to changing his bad financial habits? If so, great! If not, strongly consider keeping your finances separate in your marriage until your spouse gains some financial maturity. By doing so, you’ll likely be happier in your marriage, and have a more equitable divorce, in the event that it comes to an end.