Couples and Credit: What to Discuss
For those who are married, getting married or involved in a serious and committed relationship, finances are an important part of your life together than should be considered and openly discussed. This includes credit. Few couples keep their finances separate, therefore, it is vital to be in the know and be in agreement on every aspect of money, debt and credit. This helps to avoid conflicts and confusion that could lead to a disruption or destruction of the relationship. Many break-ups occur over money. This is unfortunate and can often be avoided with open communication. Here are some important things that couples must discuss when it comes to credit.
Joint Accounts or Individual
While few couples maintain separate accounts, some do, for various reasons. It is important for those in long-term relationships to weigh the pros and cons of their individual situation to decide whether or not to combine accounts or keep them separate. Couples need to consider the ramifications of each decision and must have complete trust in each other for either situation to truly work.
How Often to Check Credit Scores and Activity
This one is pretty straightforward. For the most part, people will opt for checking on things annually. However, if there is suspicious activity or large purchases have been made, it might be a good idea to take a look more often, especially for those looking to build up their credit rating.
How Much Debt is Acceptable
Debt is an unavoidable part of life. However, couples need to discuss and set a limit on the amount of debt they are willing to carry at any given time. This could make the difference between financial stability and financial disaster. This should be based on income, expenses and ability to pay and should also take changes in income into consideration.
Then When, What and Why of Credit Card Usage
Couples should discuss and be in agreement on the specifics of using their credit card or cards. This plan should be made, with trust in mind, and both parties should adhere to it. Surprise debt can really hurt a relationship, and if harmony is what you’re going for, then a credit card usage agreement is vital.
Couples also need to discuss the opening of new credit lines prior to ever doing so, determining what is right for them and their situation. No spouse should open a new line of credit without consulting the other spouse, as the financial situation affects both of you, as well as your children. If one spouse winds up in credit trouble, it can affect the other spouse, thanks to community debt.
You will need to decide which of you will manage which accounts and create a plan of action for financial and credit disasters. If you follow these simple steps and have these conversations, your relationship with each other and your money could remain much tighter than without having discussed these things.
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