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Health & Fitness

HOPE TO MAKE THIS A LASTING RELATIONSHIP? Take a Look at Your Spending Habits and Debt

CCCS of MD and DE CEO Jim Godfrey and noted money coach and author Olivia Mellan examine how spending patterns and debt affect couples' chance for a lasting relationship.

They say, “love conquers all,” but when it comes to dealing with money problems, maybe not so much so.  When couples in a recent National Foundation for Credit Counseling (NFCC) survey were asked what they would do if the person they loved had a large debt, the majority indicated they’d have serious reservations about taking on their significant someone’s debt.  7% even said they’d consider ending the relationship. The results of this survey are not surprising given the long-term implications and burden of sizeable debt. To avoid trouble down the road, national nonprofit Consumer Credit Counseling Service of MD & DE (CCCS) recommends couples discuss their financial habits and obligations before they marry or move in together.  CCCS President and CEO Jim Godfrey says, “If one or both of you overspends or owes a lot, this problem won’t go away on its own. Talking honestly and taking action is vital. That’s the one way to start your life together more financially aware and secure.”

But when you’re just starting out, talking about money issues can be tricky.  Psychotherapist and money coach, Olivia Mellan says this is true for a lot of reasons. Mellan, who has worked with couples for 32 years and written five books, including Overcoming, Overspending and Money Harmony, says that for most of us talking about personal finance is socially taboo. “We are conditioned not to talk. Couples today may be more willing to try than ever before, but it still isn’t easy -- especially if one of you has a problem.”

With that said, Mellan still recommends giving it a try.  “Money management plays a complicated role in relationships.  If you aren’t able to sit down and discuss your financial goals and differences, you may find it even harder to build trust.”  Credit and debt are two of the items Mellan recommends couples address when they’re just starting out. “Ask your partner ‘Do you have debt?  If so, how much and how fast are you paying it off?’ If your mate is forthcoming, try to be supportive.” Mellan also recommends couples consider trading credit reports. “Years ago, I wouldn’t have suggested this, but it may help you both make a reality check and come up with strategies to deal with major financial concerns.”

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Godfrey agrees with this approach. “Your credit report and credit score have a profound influence on your life.  They can impact your ability to rent a home, take out a loan or mortgage, or even get a job.  Although each of us has his or her own credit history, when you become a couple, your partner’s money habits and past finance decisions are likely to affect you, too.”

Studies show couples are not always honest with each other when it comes to personal finance.  In a recent National Endowment for Financial Education (NEFE) survey, about half of the spouses surveyed admitted they’ve lied to their partners about how much they spend on purchases; a third said they haven’t been honest about their debts; and 15 percent admit they have hidden bank accounts.

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If your partner is reluctant to talk about credit and debt, what can you do?  Godfrey suggests you sit down together and consider how many of these warning signs apply to each of you:

Do you frequently buy things you don’t need?

Do you only make the minimum payment on your credit card each month?

Do you continue to run up charges on your credit card without paying off the balance?

Do you have at least one credit card that’s near, at, or over the credit limit?

Do you use cash advances from your credit card or money from your savings to cover bills?

Have you recently missed a payment on a student loan?

Are you unaware of how much debt you actually owe?

Do you receive calls from creditors concerning overdue accounts?

Have you been denied credit?

Do you lie to family and friends about your spending and debt?

If any of these statements apply to you or your partner, Godfrey recommends digging deeper. “It’s best to get money problems out in the open, so you can deal with them. Recognizing there’s a problem is the first step to getting help.  Waiting too long makes it that much harder to get back on track.” 

Mellan says couples who face financial problems together often strengthen their bonds, and there are many options available for help: “Couples who have trouble talking with each other can gain better communication skills through therapy. If either of the partners is addicted to spending, Debtors Anonymous may be of help. Reputable credit counseling holds an answer for those who want to learn how to manage their money better or overcome debt.”

Godfrey agrees.  “At CCCS we often see couples who’ve been dealing with debt for most of their time together. When they learn how to budget and make wise money choices, this ultimately improves their relationship and helps them achieve a better quality of life.”

Need help getting your finances in shape before you take the next step with your sweetheart?  CCCS of MD & DE offers free, confidential financial advice at its offices throughout Maryland and Delaware and by phone. Call 1-642-2227 to make an appointment -- and make a fresh start!

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Consumer Credit Counseling Service of MD & DE, Inc. (CCCS) is an accredited 501(c)(3) nonprofit agency that helps stabilize communities by creating hope and promoting economic self-sufficiency to individuals and families through financial education and counseling.  CCCS MD State License #14-01

 

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