Money issues are one of the biggest hurdles for a couple to overcome.
You both love dogs, like the same movies, and can happily sit in silence for hours, as long as you’re together. In short, you believe you’ve found “the one.” But what about your financial compatibility? Are you sure your financial styles mesh? Here are five signs it’s time to get on the same financial page.
1. Hidden debt
If you or your partner hides debt from the other, there’s an obvious problem. Hiding debt can be a sign of shame, embarrassment, or simply a lack of trust. No matter how much you enjoy being together, financial intimacy means sharing the good — and not so good — details of your financial lives.
Financial intimacy depends on being honest about even the most embarrassing financial details. If you’ve failed to mention how deeply in debt you are, now is the time to come clean. If you suspect your partner is sitting on a pile of hidden debt, clear the air by creating a safe place to share financial secrets.
2. Too quick to use credit
A sure recipe for stress is when one partner pulls out credit to pay for whatever strikes their fancy, with no clear plan for repaying the debt. Worse yet is a partner who expects you to bail them out when they get too deep into high-interest debt.
While your partner’s spending habits may be an awkward subject to broach, their ability to manage credit can splash back on you.
The same is true if you’re the one who uses plastic without giving it much thought. Unless you pay your credit cards off in full each month, you risk carrying high-interest debt. The problem with high-interest debt is how quickly compound interest adds up, and how difficult it can be to get out from under debt once you’ve allowed that interest to grow.
If you’re serious about your relationship, your partner has a right to know about your debt, and you should know if your partner struggles with buying on credit. Ideally, you can work together to overcome the issue.
3. Bad credit
Let’s say you have excellent credit, but your partner has spent years haphazardly paying bills, and their credit score is poor. You typically take public transportation, but have moved far enough from work that you both feel it’s time to buy a car. You plan to buy it together. However, your partner’s credit score is too low to qualify for a loan. Unless you earn enough to qualify on your own, you may have to wait to make the purchase — all because your partner has a low credit score.
Relationships change. That’s neither good nor bad — it’s simply inevitable. Minor irritants you can overlook in the early days of the relationship (like a partner with poor credit) become large and irritating. Like a pebble in a shoe, the longer you deal with it, the more painful it becomes.
Before the situation becomes critical, sit down and discuss the importance of a healthy credit score. No matter which one of you has poor credit, consider working together to give it a boost. Taking on the challenge together offers opportunities to make financial decisions and develop new financial skills as a couple.
4. Chronic unemployment
Millions of Americans lost jobs last year due to COVID-19. And between 2000 and 2010, manufacturing in the U.S. shrank by one-third, changing the employment landscape forever. Job losses happen. But if your partner never seems to find a job good enough for them or is repeatedly fired, you may have a problem on your hands.
If you crave a sense of financial security, a chronically unemployed partner is likely to be a challenge. Head it off by finding out if your partner’s job losses are circumstantial (due to a recession, pandemic, or natural disaster) or a choice (absenteeism, drug use, or verbal altercations). If the losses are due to circumstance, work together to find potential solutions, like networking to find employment, or starting a business. If job losses are due to your partner’s choices, dig deeper to see whether this is a situation you can live with.
5. Different dreams of the future
The surest way to hit a financial roadblock with your partner is to assume that you share the same dreams. If you haven’t discussed where you see yourselves in the future, ask your partner about their dreams. If you dream of marriage, kids, and a house in the suburbs, and your partner dreams about retiring at 35 and volunteering with Doctors Without Borders, you should know that.
Different dreams require different financial planning. For example, if you expect to be in the same city for the next 40 years, taking out a mortgage is not a bad idea. If you plan to travel the world, buying a house is a riskier proposition.
As warm and fuzzy as any relationship starts out, there are always bumps in the road. The good thing about problems — even financial problems — is that once you’ve figured them out together, you have a blueprint for dealing with all kinds of everyday issues.