Damage Control: What to Do When Your Partner Is Bad With Money
Is your partner bad with money? Then this is likely one of the areas you fight about the most. It’s probably also causing significant stress. If you’re a saver married to a spender, financial tensions may be robbing you of peace and causing you to reconsider your union. Roughly 35% of respondents in a survey conducted by Harris Poll for SunTrust said money problems were a big cause of relationship stress.
Don’t give up hope just yet. There are some steps you can take to shield your money while also making your financial life with your significant other a little less stressful. You may love your partner dearly, but you also have to do what it takes to make sure your finances stay intact. Here’s what to do when your partner is bad with money.
Have the money talk
Instead of pointing fingers or arguing, discuss your spouse’s reckless financial behavior. From there, you’ll want to have regular meetings to go over your household budget and set some new money rules. For example, you could agree to discuss any purchases more than $100. Afterward, you’ll need to be prepared to follow through on the changes you both agreed to. Don’t allow your partner to make excuses for going way over the household budget or making big purchases without your input.
Offer to attend financial workshops and seminars with your partner. Instead of complaining, do what you can to point your significant other in the right direction. In addition to help from a financial professional, a supportive nudge could mean all the difference.
Protect your cash
Engage in risk management. Just because your significant other is terrible with money doesn’t have to mean that your finances must go down the drain, too. If you and your partner have a joint bank account, open an account of your own. If it hasn’t happened already, there’s too great a risk that your spendthrift spouse could spend both your and his money on an unnecessary expense. Reduce this possibility by having your own money set aside in a personal bank account.
Get a handle on credit cards
If your significant other is reckless with money, his or her first instinct might be to reach for the plastic. This is why having a joint credit card can be big trouble for spender-saver couplings. Go through your credit card statements to see if any outrageous purchases were made and what your current balance is. If your spouse is an authorized user on your credit card, you’ll want to remove him or her so that your credit isn’t ruined. However, if you have a joint credit card, the process might not be so easy. In order to remove yourself or your spouse from a joint credit card, the credit card provider must agree to change the contract so that it absolves you (or your spouse) from responsibility for the debt. Consequently, the provider may require that one of you has credit strong enough to be able to manage the card without assistance.
If you or your partner’s credit isn’t strong enough, or your provider refuses to alter the credit card agreement, you may have no other option than to close the account. While you may be worried about the impact closing the account will have on your credit score, waiting until after your partner’s next spending spree might cause more damage.
Order a copy of your credit report
No matter how much you trust your significant other, there’s still a possibility he or she could be keeping a financial lie or two from you. Go through each of your credit reports to see if your partner has opened any accounts in your name without your permission. If you never check your credit reports, you won’t know until it’s too late. Consumers are entitled to one free credit report every 12 months (just log on to www.annualcreditreport.com) from each of the three major credit reporting agencies (Experian, Equifax, and Transunion). Order your report today.
Meet with a financial professional
Don’t forget to call in professional help. If your partner is having trouble managing credit and is struggling with a significant amount of debt, it may be beneficial to suggest he or she connect with a certified credit counselor. Also make an appointment with a certified financial planner to help you get back on the right track with your financial goals. You can find a certified credit counselor when you visit the National Foundation for Credit Counseling website. You can find a certified financial planner near you when you log on to the Certified Financial Planner Board of Standards website and use their search feature.
Prepare for the worst
Many relationships experience friction and eventually end in divorce due to conflicting money styles. Be financially prepared for the possibility you and your partner could split. Start saving up now for future divorce costs and organize financial documents.
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