In October, Bloomberg Business week released an article on a correlation between couples’ credit scores and their longevity. The writer, Luke Kawa, made a few interesting points on how a person’s financial past may be the key to their romantic future.
Kawa claims that people with similar credit scores tend to draw together, and those with higher scores appear more trustworthy than those with a poor score. One observation Kawa made that rings true is how discrepancies between spouses can cause major problems. While this isn’t new news, (the number one cause of divorce in America is money) it’s worth unpacking this idea a little bit more.
Couples fight about money. It doesn’t matter what income bracket they are in, money causes problems because thee either isn’t enough or too much is going out. In order to survive (and thrive!), a couple needs to find a common ground. Not only will your problems be solved, but also your relationship will be rock solid in the end because the two of you accomplished something together.
1. Tally up the income and spending for the last 3 months: Yes three. This will give you a pretty good snapshot of where your money is going and will provide you with a weekly average of both your income and spending. You can’t figure out where to go if you don’t know where you’ve been.
2. Make a budget… together: Step 1 sets you up and shows you where to make cuts if necessary. You have to work together on this. Sit down every week and go over the finances, what each paycheck looks like and where it’s set to go. Write down every bill that is due, grocery shopping, gas, and play money, decide on a number and stick to it. When the money is gone, you’re done off for the week. It will teach both of you self-control and you will know where each and every cent went.
3. Pay down your debt: You both may have gone into the marriage with individual debt. Guess what? That debt has gone from his and hers to ours. You now have collective debt. Examine your car payments, student loans, mortgage, credit cards, and any other unsecured or medical amounts owed and make a plan. You can either do the Dave Ramsey Debt Snowball or the debt avalanche method or a combination of the two. It doesn’t matter, decide what works as a couple and stick to it.
4. Make the same financial goals: Maybe you want to buy a house. Maybe the dream is to be able to travel or send the kids to college so they can avoid their own debt crisis. Whatever it is team up and figure out what you want and how to tackle it.
Finances are tricky and are guaranteed to cause a major rift between a couple. If you can come together, communicate, and make a plan you both can stick to, you can avoid one of the biggest hurdles a couple can face.