How debt affects your relationship

Was Shakespeare right when he said, “Neither a borrower nor a lender be?” It often depends on the nature of the relationship. Borrowing and lending makes the world go round when it comes to national economies, corporations, or small business, but it’s a very different story when it comes to your spouse.

Debt can have a devastating effect on a relationship. It’s often cited as the No. 1 reason couples argue, and among the most common causes of divorce.

An American university study last year reported that couples who argue about money early in their relationships are at greater risk of divorce, whatever their income, debt or net worth. The 2012 study, “Examining the Relationship Between Financial Issues and Divorce,” also said that arguments about money were longer and more acrimonious than arguments about other topics. Another university in 2009 found that couples who disagreed about finances once a week were more than 30% more likely to divorce than couples who reported disagreeing about finances less often.

The best way not to join their ranks is to make good choices from the beginning. When you’re contemplating a major relationship commitment, talk to your partner about money.

Talk about your attitudes, your culture, what you think money is and its role in society. Talk about your financial priorities. If one of you wants to save for retirement and the other wants a speed boat, you’ll need all the open communication you can get. Disagreeing doesn’t mean your relationship is doomed, but it will take continued non-judgmental communication and regularly revisiting the issue to keep from developing resentments and creation

financial tensions down the road. Talk specifically about the debts you bring to the relationship, and be absolutely honest.

If you’re in a relationship with someone whose debts far outstrip yours, or who seems to constantly be accruing more, consider waiting before making a long-term commitment. Give him or her the chance to straighten out their financial difficulties, or at least take the right steps towards doing so, before you walk down the aisle.

If you’re already married and you or your spouse is in financial trouble, it doesn’t necessarily mean both partners are in the same boat. A debt that is yours alone (for which they did not co-sign) does not affect your spouse’s credit, and a bankruptcy affects only the insolvent spouse. Joint debts can be a different story, and can even your ex-spouse’s (or one from whom you are legally separated) behaviour can affect you financially.

If you’ve got concerns about your financial future, or that of your prospective spouse, talk to a qualified Credit Counselor today.

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