Monday, May 27, 2013

Financial Matrimony: How Much Debt Would You Be Willing to Accept?

Remember when dating was simple.  All a guy had to do was pass you a greasy napkin asking whether you liked him.  You had the option to check “Yes” or “No” and depending on your response that could be the start of a great romance.  Nowadays, dating and relationships have become much more of a risky investment. 

No longer do I hear my single girlfriends talk about finding their “knight in shining armor”, rather they’re talking about how much debt this guy is going to bring to the table.  They definitely have a reason to be concerned since it isn’t at all unlikely they will date and marry someone who has been married multiple times and/or has children from a previous marriage.  You’re also looking at singles that have outstanding loans from school, mortgage, car note, credit cards, judgment liens or even bankruptcy. 

Issues with money are usually rooted from childhood.  Parents tend to be very influential in how the child perceives managing the money in that household.  If budgeting and saving money techniques are taught in the household, the child will use such techniques in their adult life.  If money is seen as the “root of all evil”, this negative perception will follow them accordingly.

There’s also a psychological element to money.  People use money as a tool or means to alleviate any negative emotions.  For example, when a woman goes through a divorce, she may pull out her credit card and engage in compulsive shopping as a means to avoid the pain of the divorce.  On the other hand, a man may use his money to attract lots of women to avoid feeling lonely.  There’s always an emotion or feeling associated with spending money and that feeling dictates how much or how little of the money will be spent.  When those feelings involve a love relationship, particularly one associated with a negative experience, the money may be spent unwisely.

People that have high outstanding debt are generally ashamed that they are in this position in the first place.  They feel really guilty about having to carry it into their new relationship.  If the person with the debt can acknowledge their faults and take responsibility for their past actions, the person will work hard to pay off all amounts that are due.  On the other hand, if the person cannot readily accept their role in the situation and/or refuses to take any ownership of it, it may be time to re-evaluate the relationship.

Overall, when you’re planning to spend the rest of your life together with that special someone, you’ll need to determine whether you can accept their past debt or whether it is better for you to move on from the situation.  A person with a high amount of debt could have hundreds of thousands of dollars to pay back to a creditor or lending agency which could take several years just to pay down the interest.  It could affect you as a couple when buying a house, a car, or when your spouse applies for a job.  Even the simple luxuries that couples enjoy such as travelling together or just going out to a movie would have to be negotiated as the person may not be able to afford to go.  Just remember that you are accepting the person and their debt as a complete package deal. 

If you do decide to accept this person into your life for the long term, try not to judge them on their past spending habits but be supportive of them in their journey ahead.  This certainly isn’t an easy task for them but having you as their trusted partner will make the journey easier.  Helping the person overcome their past debt can lead to tremendous growth and healing and a greater understanding achieved.

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