Credit Card Debt Takes Toll on Relationships of Chicago Couples
Maybe the best gift you can get your significant other this Valentine's Day is to come clean about your credit card debt and make a commitment to solving the problem together, perhaps with help from Chicago bankruptcy.
Studies have pegged debt right up there with infidelity as one of the top causes of breakups and divorces in the US. But often it's not the debt itself that's the problem.
As many as 80 percent of spouses hide purchases, bank accounts, or credit cards, according to a survey by CESI Debt Solutions.
Chicago bankruptcy lawyers have spoken with many clients who spent years hiding credit card debt and other money woes from a spouse or partner, ultimately damaging the relationship and allowing their financial troubles to spiral out of control.
It's true that debt causes stress, and stress can take a toll on your relationship. But hiding debt causes something worse: communication breakdown.
Spouses who hide the severity of their debt frequently suffer from depression and other health issues due to the anxiety of bearing their burden alone. The spouse kept in the dark often becomes suspicious and untrusting, and - when the debt is exposed - feels angry, resentful, and betrayed.
In most states, both people in a marriage suffer a reduced credit score and are considered liable for debt, even if one partner is mainly responsible.
There's truth to the old saying that two heads are better than one. Not only can working together with your partner help you come up with a more rational solution for dealing with debt, but it can also keep you on the same page, reducing feelings of helplessness or resentment.
Of course, it's unrealistic to assume that simply talking about finances will make relationship stress disappear. But being open is a start.
Most financial advice for couples is limited to tips on saving money for a house or how to separate bank accounts. But what happens when just rearranging the budget isn't enough to pay the bills and pay down debt?
Often times, bankruptcy can provide the most realistic solution when debt has become unmanageable. With a Chapter 7 or Chapter 13 bankruptcy, most or all of a couple's unsecured credit card debt can be eliminated, saving years of accumulating interest - and a lot of stress.
In the meantime, here are a few tips from CNNMoney on how to maintain your relationship while battling debt.
Have the Money Talk Early On
Ideally, take some time before you get married to sit down and talk about where you stand financially and how you intend to handle finances together. A relationship can survive without perfect finances (for instance, you may decide to eliminate debt with a tighter budget or bankruptcy) but it can be very difficult if partners aren't financially compatible to begin with. It's a good idea to find out whether you share financial priorities before your finances become legally tied.
Look for Red Flags
Does your spouse only pay with a credit card? Have you noticed a lot of new bills sitting around the house - some for purchases you didn't know about? Or perhaps you haven't noticed any bills because your partner has been squirreling them away? When you attempt to talk to your significant other about money, do they seem resistant - or even angry? You may need to get to the root of a financial problem - and seek financial help together.
Go Over Your Finances As a Couple
Make a point to get periodic credit reports (you're legally allowed one free annual credit report from each credit bureau) and go over them together. It may not be realistic to share every nickel and dime you spend, but couples should at least have a basic understanding of how much is being spent and saved by each party.
More Blog Entries:
Are Your Financial Secrets Hurting Your Relationship?, February 1, 2011
80 Percent of Spouses Lie About Spending, Chris Friedrich, CreditCards.com
Financial Infidelity: Catching a Cheating Spouse, Jessica Dickler, CNNMoney