What will happen to my money and accounts when we get married?
Learn how to protect your money and accounts and improve your fiance’s poor financial habits.
I’m getting married and I’m worried about finances because my fiancé isn’t very responsible. He’s a wonderful man, but his credit isn’t good and he’s routinely talking about paying bills well after the due dates, so I know he has problems with late payments. I feel uncomfortable asking him directly, but I just kind of assume his credit is bad.If I was in the same boat it wouldn’t be a problem; but I was raised to be responsible with money so this is kind of driving me crazy worrying about what’s going to happen. What will happen to my money and all of my accounts when we get married?
Congratulations on the upcoming wedding. I’m sure things are a little crazy right now with the planning and butterflies about the “big day” but you’re doing the absolute right thing when it comes to worrying about your finances.
According to a recent survey, arguing about financial issues ranked third on the reason for divorce. Another interesting stat from the survey is the number one reason – incompatibility. Feelings of incompatibility could arise from not having the same financial philosophies, which seems to be an issue for you and your fiancé right now.
As for what will happen to your accounts, it depends on the actions you take now and after you get hitched…
First, I recommend that you sit down with him and seriously discuss the implications of money and marriage – communication is the key. Most couples are so caught up in the moment they don’t realize the negative impact a spouse with poor financial habits could have on their ability to borrow and reach financial goals. Even though you don’t merge credit scores when you get married, it doesn’t mean their bad habits and history won’t affect you.
That’s because when you start joint accounts, whether it’s a credit card account or a mortgage or rental agreement, the lender will review both of your credit histories. If your fiancé has missed payments in the past, that will reflect poorly on both of you and could lead to a rejection for a credit card, mortgage or other loan. If you do qualify, the red flags on his report can likely lead to higher interest rates.
So, if your fiancé has a poor credit score, it’s important that he go through the process to repair his credit. Since you’ll be going through the process with him, it’s also a good idea for you to pull a copy of your own credit report so you can both review it. This may be a good way to see just how bad he really is with his finances without having to ask uncomfortable questions that could start a fight. He’ll also see how clean your credit is, which may inspire him to do better.
If his situation is truly a mess, then you may want to consider keeping separate accounts until it is fixed. Unfortunately, that will make it harder for you to qualify for certain loans, especially a mortgage, unless you’re making enough money to qualify on your own. However, for new credit cards and smaller loans, you’ll probably have an easy time qualifying since you have good credit.
Also, you can add your fiancé to your account as an authorized user or joint account holder without damaging your score, but be aware of the risks. You must fully trust him with your credit. If he happens to be a big spender and uses all your available credit, then he will damage your score– even if he’s just an authorized user. If it’s a joint account, I’d recommend that you take responsibility for paying the bills so his bad habits don’t come back to haunt you both.
I wish you luck and remember, communicate with him about money issues. It’s key to a lasting marriage. Don’t hesitate to call if you need more information.
Jeffrey Schwartz is the Executive Director of Consolidated Credit Counseling Services of Canada and President of the Credit Association of Greater Toronto (CAGT).
If you have a question about a debt management program or just about finance in general, Jeff is here to help. Send us an email with your question to AskJeff@ConsolidatedCredit.ca. You’ll get the expert advice you need and your question may be featured here on our website.