In Relationships, Is Your Partner’s Debt Your Debt?

According to some rather bleak statistics, almost everyone in the US has some sort of debt. Student loans, mortgages, credit cards, medical bills, car loans…the array and depth of debt out there is staggering. The average student loan debt is $32,593 and the average credit card debt is $15,706, according to Nerdwallet’s statistics.

What Kind of Relationship Do You Have?

So what happens when two debt laden souls fall in love and start a life together? Or when one of you has debt and the other doesn’t- does your partner’s debt become your debt, or do you each retain your debt independence? When it comes to debt in relationships, who will pay?

If you are in it to win it with your partner you should have an in depth discussion about finances ASAP. I wouldn’t recommend picking up a partner’s debt unless you are already either legally committed (like marriage or a civil partnership) or have been together basically long enough to qualify as a common law marriage.

A three month long relationship is probably not the place to be discussing paying one another’s debt off. Assuming a partner’s debt is no small thing and you should only do it for someone you are deeply serious about building a life with.

So if you’re at that level, get a cup of coffee, a box of donuts and dive right on into spreadsheets and credit card statements and interest rates.

Picking Up Your Partner’s Debt

Debt should be a huge priority in that conversation. You need to know how much either or both of you owe and where to. Student loan debt is different from credit card debt and it shows in the interest rates. You have to know what you’re up against to know how to go after it. Don’t be afraid to share with your partner. Remember, this person thinks you’re pretty cool and likes you a lot. If there’s anyone to be honest with, it’s your partner.

Once you know what’s on the table, be honest about what your financial contributions will be. If you are debt free while your partner has a small amount of debt and you’re in a long term relationship, both of your contributions could wipe that debt out easily. If one of you makes 10x what the other makes, will that person contribute more to the debt? Will you follow the debt avalanche method? Determining details of your approach is key in this conversation.

If there’s a big number, talk about what kind of approach works for your relationship. Are you a couple that would benefit from taking a year and throwing everything you have at your debt? Could you devote one person’s entire paycheck to debt and live off the other person’s? If you have a timeline for your life together, maybe a longer term approach would work for you. Again, honesty is key in this conversation.

Paying Debt Separately

Joining forces to defeat the debt monster is not the right path for everyone. Some people who are in long term serious relationships find that sharing money doesn’t work for them. I know that I personally would not assume my partner’s debt right now, even though we’re in a committed relationship.

If you decide as a couple that your partner’s debt is not your debt, you should still come up with a game plan for finances. If one of you is paying off debt, that’s a monthly expense that the other needs to be aware of. Make lifestyle adjustments together so that the person paying off debt feels good about their spending.

If you are each tackling debt on your own it’s probably easiest to maintain separate bank accounts. Keeping accounts separate while making debt payments and combining after both parties are debt free can be a wonderful way to move from an individual mindset to a couple’s mindset, and can be a great way to move forward together. Who knew that debt could bring people closer? =)

The most important thing is to talk about your debt and your finances. Money is still taboo in our society but the silence hurts more than the debt. Figure out a plan that works for your relationship and take those steps together.

Did your partner have debt when you got together? What approach did you take?

Comments

  1. I’m not married yet, but, I have a girlfriend. If one of us is facing debt, we always make sure that we are helping out each other. Money should not be an issue with your relationship because if you did, that will be your relationship’s greatest downfall. Just my opinion.

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