When many people decide to get married they don’t want to ruin the romance of the occasion by talking about money. Others think money issues only happen to “other people,” but they are wrong. Money problems in a marriage are essentially communication problems with dollar signs. No matter how much in love a couple might be, no one is immune to the effect that money and debt can have on marriage. That lack of communication regarding money and debt can both lead to divorce and bleed into matters of property division and financial support should a union end in a split.
According to a 2009 study conducted by researchers at Utah State University, those who have financial disagreements at least weekly are more likely to divorce. With more people marrying later in life, there is a greater chance each individual will carry their own debt into a marriage. The best way for both parties to figure out how to deal with the joining of their finances is to take the time to talk about the issue seriously before they say “I do.” However, a study conducted in 2010 by American Express revealed that such a pre-marital talk about finances was the exception, rather than the rule.
With there being so many different attitudes on how to handle money in a marriage and what types of budgeting rules to set, money can be a real hot button issue for a lot of couples. Many times, a financial planner or other mediator who offers expertise in money management can be consulted as couples get together and develop guidelines and rules about where money gets spent and why. Couples might also want to create prenuptial contracts that lay out how each individual’s debt will be handled in the case of divorce.
For those who have already tied the knot, money issues can often tempt deception that may eventually lead to divorce. One survey on Creditcards.com revealed that there are over six million financial accounts that Americans hide from their spouses or partners. More often than not, these secret accounts are born from embarrassment about one’s own financial shortcomings, and it’s the same type of embarrassment that leads many to wait too long before asking for financial help. By agreeing on what to do about debt when things go wrong, as well as keeping the lines of communication open when things go right, couples stand a better chance at overcoming whatever financial challenges they might face.
Source: Reuters, “How couples sabotage their finances,” Chris Taylor, June 6, 2012