Debt In A Marriage: What Are My Options?

Marriage is supposed to be a beautiful thing, but sadly, so many newlyweds don’t know each other’s finances before tying the knot. If one spouse is entering the new courtship with a newfound debt from their partner, there are probably a lot of questions that need to be answered.

To help you understand the debt that comes from a partner after marriage and learn more about how to manage marriage and finances.

Is it Mine, Yours, or Ours?

Every state has its rules when it comes to who owns what debt. One of the first questions that newlyweds have when it comes to debt is: Who the heck is responsible for this debt?

The first thing that you need to look into is if your state is a community property state. In a community property state, such as Arizona, Idaho, and more, the spouse may be liable for the debt upon marriage. However, in an on-community state, the spouse won’t be liable for any debt they didn’t sign up for. A quick search for your state laws can let you know where your state falls.

Combining Debts

Regardless of what your local state laws are, many couples often want to combine their debt to pay it down fast. If this is the route that you want to take, there are many options that you can take advantage of.

For instance, many credit card companies offer balance transfers for zero percent interest for a limited time period. This is a great way to combine your debts all under one account. If you’re going to take this route, just make sure that your balances aren’t too high, because if you don’t pay your bills off in time, you may be stuck with an interest rate that is higher than 20 percent.

If you don’t want to take the credit card route, consider talking with a reputable debt resolution company. A good debt resolution company will be accredited with the Consumer Debt Relief Initiative (CDRI), have at least an A BBB rating, and never charge you upfront fees. Generally, they will be able to save you around 50% on your original account balances, if not more. To learn more about how Pacific Debt can help, check out the details on our debt settlement program.

Lastly, if most of the debt is coming from student loans, look into various federal programs to help consolidate the loan. This is a route that should be taken if the student loans are in the tens of thousands.

Separating Finances

If you believe your spouse should pay for the debt they created, that’s fine. However, keep in mind that a successful relationship works on teamwork.

When going this route, it’s best to wait on a joint bank account or combine any other accounts until the debt is entirely paid off. Aside from the debt, also make sure that you put in your fair share of the bills that have to be paid every month, such as the utilities, rent, cable, and so forth.

Try to find that happy medium that works for your relationship. In the long run, debt is going to take time to pay off. As long as you work as a team, create a budget, and motivate yourself to pay off these debts, there’s no reason the debt will ruin the newfound marriage.

Communicate Openly About Debt

One of the most important things when dealing with debt in a marriage is to communicate openly and honestly about it. Set aside time to sit down together and go through all debts - yours, mine, and ours. List out all the debts, the amounts owed, interest rates, minimum payments, etc.

Having all the facts and figures in front of you allows you to see the full debt picture clearly. It also avoids any surprises down the road if new debts come to light that one spouse was not aware of.

Approach this conversation without judgment or blame. The goal is to work together as a team to tackle the debt, not point fingers at who is responsible. Make sure both spouses feel heard and understood.

Create a Joint Debt Repayment Plan

Now that everything is out in the open, you can start mapping out a joint plan of attack. Sit down and look at your combined incomes, expenses, and financial goals. What is realistic for you to put towards debt repayment each month? Are there areas where you can trim expenses and put those savings toward debt?

Prioritize paying down the debt with the highest interest rates first, as this will save you the most money in the long run. You may also consider consolidating multiple high-interest debts into one through a balance transfer credit card or debt consolidation loan.

Most importantly, make sure both spouses are on board with the plan and each knows what they are responsible for contributing. Review the plan together regularly and celebrate milestones like paying off credit cards or loans.

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