Are you a cheapskate and your spouse hates saving? Conflicting opinions on money are one of the most common reasons of fighting between couples. Here are tips to save money and boost your credit rating without fighting over money.
Understand that you are two different people with different backgrounds
Many marital problems arise from money—and it is not only difficult to resolve. It can be painful and brutal as well. The way each of your spend money is not a simple question of habits and lifestyle choices. It represents your core values, inherent characteristics and underlying psychological issues. So when you touch the subject, hidden fears, anger and other negative emotions may surface.
Arguments on money can escalate and lead to divorce. It is because poor debt management and money habits can destroy the saver spouse’ sense of security. Meanwhile, the spender may not think about it in the same way. Some people who grew up in poverty resent their spouses spending their money. But, it doesn’t apply to everyone. There are people who grew up really poor can be very thrifty while others can be spendthrift. Still, there are many those who have balanced attitude towards money, regardless of their upbringing. Past experiences affect the way we deal with debts, and available funds.
For example, Jerry, a blacksmith tends to overspend when he gets his paycheck. He spends till there is nothing left while his wife struggles to pay for their daily expenses and household bills. It is because when he was younger, his older brother always takes away his allowance, which made him spend them right after his mother hands him the money. He used to be a saver when he was a child—but that changed when his brother started stealing his money. For fear that his money will be taken from him and he won’t be able to enjoy it, he decided to spend his money up to the last cent, until today.
Sometimes, we have to deal with a partner’s emotional baggage. If you don’t want to stumble over it every time you look at your credit rating and your overdue bills, acknowledge your differences. While you want your partner to adjust to your financial situation and take responsibility in the financial issues in your family, acknowledging that emotional issues drive your spouse’s behavior about money can loosen up your conflicts a bit.
Don’t share Ownership of Debt
As a couple, either of you can use your conjugal property as a security for a loan or mortgage. When the borrower fails to pay, your property can be a subject of forced sale/foreclosure. But, generally speaking, you are not responsible for the debts of your spouse, as long as it is not under your name, or you did not sign as a co-maker. So, if you don’t want your credit rating to go down-in the event your spouse fails to repay his or her debts – it is advisable to make an agreement that whenever you make a loan, you will not share debts under your names. This way, the borrower will be solely responsible for the debts incurred.
When the marriage breaks down, The Family Law Act of 1975 allows that the properties owned by the couple can be assessed to pay off existing debts. The court can determine whether a certain debt will have to be paid off by your conjugal property or those personally owned by you. But, in most cases, the borrower whose name appears on the credit account usually shoulders the full responsibility for the debt.
Manage your own Debts Wisely
Pay more than the minimum of your debts each month to reduce your debt faster. One of the best ways to do this is to automate your payments-and adding an extra amount that will go directly to the principal. It doesn’t matter if you can only afford an extra $10-you can just gradually work on making extra payments when your finances get better. The important thing is that you are already making progress. You can also refinance your loans to pay off your loans faster, decrease interest rates, and get one consolidated loan with a single monthly payment.
Set up a Household Budget that works for you both
Whether you agree to combine your finances or not, you need to sit down and agree on your household budget. There are expenses that you need to cover together so it is best to agree on the percentage of your income that will be sued for household expenses, especially if you have children together. So, write down the common expenses like food, shelter, clothing, school, and other household activities. It is also important to write down the utility bills, credit card balances incurred because of common household expenses, car payments and mortgage or rent, if applicable.
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