How Spouses Can Get Out of Debt Together | Finances | Blog | Better Marriages | Educating Couples - Building Relationships

How Spouses Can Get Out of Debt Together

Check out Couple Talk About Money Matters, a downloadable workbook for couples. Developed by a certified Specialist in Marriage Enrichment and a Financial Advisor, this workbook will give you the structure required for a productive, conflict-free conversation.

As a couple, you and your spouse will be navigating through all of life’s joys, and also its many difficulties along the way. One of the most prevalent challenges in any marriage will be organizing a financial plan, and studies show that it’s common for couples to separate due to financial difficulties.

While it can be difficult at times, there is a lot of value in working out financial challenges together as a couple. Not only can this help you become closer to your spouse by getting to practice important relationship skills, like communication and problem solving, but also can eliminate financial stress and help the both of you enjoy your relationship.

One of the biggest hindrances to financial success is debt. Very few people can ever get by in life without taking on debt, especially when it comes to student loans and mortgages, which are often a necessary, but stressful part of life. However, with the right amount of planning and strategizing, you and your spouse can find ways to quickly work through debt, and live a life with more financial freedom.

 Create a Game Plan

Without a game plan for your money, getting out of debt is going to be incredibly difficult. It’s important to plan with your spouse through all steps of the process from the start so that both of you can be equally involved. Talking about financial topics isn’t easy, but the more you do it together with your spouse, the easier and more comfortable it will be in the long run.

Based on what each partner owes, or how much you owe as a couple and along with each person’s income, you can determine whether or not you would want to combine the debt under a debt consolidation loan, or keep the debts separate and pay them off individually.

Paying them off together has the benefit of making the process go by more quickly, as there are two people tackling one debt payment. Along with this method, one person may feel like they’re paying far too much for another person’s debt, so before solidifying costs communicate fully before proceeding. Having each pay off their own debt can lead to less conflict, but may take much longer, and doesn’t come with the benefit of allowing each spouse to hold each other accountable for the final goal.

After you’ve determined how your debt will be split up, look into the different types of debt payment methods, such as the avalanche or snowball method. The debt avalanche involves paying off the largest debts first and working your way down, while the debt snowball strategy is about first paying off the debt with the lowest interest rates so that you’ll have more money ready to pay off the larger debts. Each has its merits, but only you can decide which one works best for you.

Automate Your Finances

Sometimes, debt payment becomes more challenging if you’re manually paying them off each month. Nowadays, with advancements in technology in the financial sector, you can use your bank account to work directly with companies that you owe your debts to and schedule automatic payments each month. This allows you to quickly make payments without thinking about it. They can also be easily canceled, so if times do get tough, you will still be able to make payments without worrying about incurring hefty overdraft fees.

Unfortunately for many couples, finding a bank account can be difficult when paying off debt, this can often lead to poor credit scores and prevent some people from passing a bank’s credit check. If debt has lowered your credit score and caused you and your partner to find it difficult to open a bank account, look online for second chance banking options, which will allow you to have access to a payment account with a low credit score.

Adjust Spending When Necessary

If you’re currently overspending, or lack the funds to make debt payments, your budget may need to be adjusted in order to help make the debt payment process go smoothly. Cutting back is something that should always be communicated beforehand between both members of a relationship.

Begin by talking to your partner about ways you both could cut back on spending, and how much you would both be comfortable with cutting back. For some couples, even cutting back on an extra $50-$100 can make a world of difference! After you’ve agreed on a set amount to cut back on, determine areas you’re overspending, and make changes where necessary.

Frequently, debt can come from excessive credit card usage, so consider communicating with your spouse about ways to cut back on credit card payments, or any other unnecessary expenses that could be draining your budget, such as going out for food too often or online shopping. While they may not seem to be too expensive on their own, over time they can add up quickly and strain your wallet.

Cutting back isn’t fun, but it’s only a temporary situation, and your regular spending habits (that won’t lead you back into excessive debt) can be resumed once you’re debt-free.

Continue Communicating

Finally, you and your partner should remember to always continue communicating throughout the process. Paying off debt is a marathon, not a race, so don’t be afraid to take a step back and reassess when necessary.

You may find it helpful to meet with a financial advisor if you do find the situation is not improving in the way you thought it would. A professional may be able to find the ways your plan is failing and make adjustments that will help you get through this more smoothly.

Paying off debt is not an easy task. It’s a long road with many difficulties. However, the challenging steps along the way are well worth the reward of financial freedom. By taking the time to pay off debts, you and your spouse will not only be able to draw closer to one another but move forward in your relationship with a new focus on growing together, with one less stressful thing to worry about. 

Check out Couple Talk About Money Matters, a downloadable workbook for couples. Developed by a certified Specialist in Marriage Enrichment and a Financial Advisor, this workbook will give you the structure required for a productive, conflict-free conversation.