The Truth About Debt and Marriage
Most everyone looks forward to marriage; you’ve found the love of your life, and you’re looking to the future of having a family and growing old together.
However, most people don’t think about all the little details about marriage — details which can ruin your happy life together. And one of those details has to do with debt, specifically, inheriting your partner’s debt when you get married and how it affects your life.
In this article, we look at the subject of marital debt and how you can both protect yourselves.
The Law says
Most states in America say you’re not responsible for any of your partner’s debts before you get married. However, after you say “I Do,” things can change.
According to the IRS, states operate within the parameters of what’s known as common law or community property.
Community property vs common law
Some states operate under what’s known as community property rules which say both spouses are responsible for debts even though the debt may have been incurred by one spouse.
Other states operate under standard law property rules which say debts incurred by one spouse don’t have to be paid back by the other unless the debt was taken on to benefit the family, such as in a home loan or food.
About joint accounts
What you should remember about joint accounts is that both of you are on the hook for paying back any debts you incur when you open these accounts.
Also remember that both parties are responsible for the debt, which means it’s not split down the middle. If your significant other can’t make the payments on the account, you’re responsible for paying it in its entirety.
Before you tie the knot
The best thing you can do as a couple before you get married is to sit down and be honest with each other about your financial position.
Money is one of the most significant issues couples fight about, so knowing where each of you stands, and how to prepare for the future helps you both get off on the best foot and avoid the pitfalls that come with money issues.
Experts recommend you review your credit reports and histories together and find out where issues lie. Get a sense of each other’s spending habits and attitudes towards money, so there are no surprises down the road.
Lastly, experts recommend, a premarital discussion, and holding off on getting married if one spouse has severe financial problems such as back taxes or delinquent loans until they can be ironed out.
Being honest and upfront with each other about money is essential to a healthy marriage, so it’s critical not to let your feelings and desire to be with another person cloud your judgment with finances because it will come back to bite you if you’re not careful.
Also keep in mind that even in the event of separation or divorce, you may still be responsible for the debt you both incurred while married.
Want to have a happier, healthier marriage?
If you feel disconnected or frustrated about the state of your marriage but want to avoid separation and/or divorce, the marriage.com course meant for married couples is an excellent resource to help you overcome the most challenging aspects of being married.