Tips for couples to help solve money problems

By Michelle Singletary
Sunday, July 4, 2010

In my online discussions I frequently get questions from couples facing financial issues.

Q I'm getting married next summer and my fiance and I are in a lot of debt. We live together and have two kids. There is a breakdown in communication when it comes to our finances. I've recommended we talk to a credit counselor, but he shuts down and doesn't want to talk about it. He did agree to go to premarital counseling. I don't know where to begin to get out of debt. I've tried to budget. I feel overwhelmed.

A You are right to be concerned. When a partner refuses to talk when you're trying to work out the financial stuff, that's a huge red flag. Communication is key when it comes to money, and if that's a problem now, it won't get better with a ring. The way to find out if you should get married is to take him up on his interest in going to premarital counseling. Go soon, before you put a penny down on any wedding arrangements. For now, don't stress about what he won't do. Let it all come out in counseling with a neutral party. Find a really good premarital counseling course or instructor. During your search, make sure the person or program incorporates techniques to help budget and tackle the debt in addition to dealing with the emotional issues.

My husband and I are renting a condo but want to buy a house soon. We have about $11,000 in a bill consolidation loan. We have $12,000 in savings. The emergency fund is what's in our savings, but I'm able to put at least $500 a month in there, so it's building. Would it make more sense to keep paying the loan (the minimum is $350 a month, but I usually pay $700 to $1,000) and save what we can, or take the money from savings and pay off the loan and then build the emergency fund back up?

This is what I would do:

-- Calculate how much you need for an emergency fund of at least three months of living expenses (rent or mortgage, food, utilities, cable, cellphone service, etc.). This will give you a benchmark of what you should have on hand before you even think of buying a house.

-- Designate about $2,000 for a "Life Happens Fund" for expenses that come up, such as car repairs. Take this money out of the $12,000 and put it into an account separate from your emergency money. This leaves you with $10,000.

-- Put $5,000 as the beginning for your emergency fund. When you reach the three-month goal, then start saving for the housing fund.

-- Take the rest of your savings -- $5,000 -- and pay down the $11,000 loan. If you are paying upward of $1,000 a month on that loan, you will be done with it in six months.

My partner continues to run up credit cards, and I keep helping him pay them off. He promises me every month that he's not going to do it again. But sure enough, like clockwork, he runs them up again within a few weeks, mainly through online shopping when he's bored. Any tips on how to help him to stop?

Stop yourself. You are part of the problem. He knows you will be there with the money for a bailout. Quit helping him, and he'll have to face up to his problem.

My girlfriend of two years has about $50,000 in debt and donates $3,000 to $5,000 a year to various charitable events. I have no problem giving to charity, but am I a bad person for thinking that paying off debt should come before giving away about 20 percent of her take-home salary? Right now it is her money and she can do what she wants, but I'm thinking of the future when we get married.

I think it's great she wants to give, but you are right to be concerned that she may not be aggressively attacking the debt. But the answer isn't in encouraging her to stop giving. Instead, say: "Honey, I'm worried about how much you have in debt. Do you mind if I help you budget or recommend a source that could help you get rid of your debt?" If she doesn't want the help, just sit back and watch. If getting rid of the debt isn't a priority, you are facing the future with conflicting values.

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