Til’ Debt Do Us Part?

Take Charge America Presents Five Financial Issues Couples Need to Address Before Tying the Knot

PHOENIX, Ariz. (March 27, 2006)... Are you on the verge of saying “I do”? Wedding season is right around the corner and that means thousands of brides and grooms will vow to share their lives before family and friends. And for better or worse, that means they’ll be sharing finances too.

Mike Sullivan, director of education for Take Charge America, a non-profit credit counseling company, says soon-to-be newlyweds need to have thorough discussions about their individual finances before combining them.

“It is best to tackle these money issues before marriage,” said Sullivan. “Lay it all out and come up with a plan that fits both of your lifestyles.”

The latest statistics show nearly 40 percent of all marriages end in divorce. One of the major culprits: money problems.

Sullivan says prevention is the key, when it comes to marriage and money. He presents five issues couples need to discuss before walking down the aisle:

• Lay It All Out – Literally. Gather your financial records, bank statements, tax returns and credit reports to share with your partner, and vice versa. Explain what each of you owes and how much you have stashed away for retirement and other expenses. If either of you has $100,000 in student loans or didn’t file your tax return, this is the time to come clean. You can obtain a free credit report by calling 1-877-322-8228, logging onto www.annualcreditreport.com, or writing to: Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281. Cross check your report to ensure the information is accurate.
• Define Your Goals – Where do you want to be in five, 10 and 20 years? Discuss where you will live, career plans, children and traveling. Are you a city dweller or country lover? Where do you want to raise children or retire? How much money will it take to achieve these goals and how do you plan to earn that money? If you or your future spouse has debt problems, see a credit counselor or financial advisor about the best plan of attack to get out of debt and achieve your financial goals.
• Dividing It Up – Who will pay for what? Every situation is unique and there isn’t one “right” way. There are basically three options: combine both of your accounts, keep them separate or contribute an equal percentage of your income into a joint account while also maintaining separate accounts for personal use. Decide who will be responsible for daily purchases, paying off debts and larger investments. Make sure you each have some “walk around” money.
• Create a Budget and Bill-Paying System – Once you decide how to split your finances, decide how much money you will allocate toward bills, debts, investments, children, vehicles, entertainment, etc. Who will be in charge of mailing bills, signing checks and monitoring accounts? If you need to stray from the budget make sure you check with your spouse first.
• Keep Communicating – You should reevaluate your financial state every three months. Track your progress and decide whether you need to adjust monthly payments or redirect a portion of your finances. Keep each other in the loop to minimize unwanted surprises and arguments.

About Take Charge America
Founded in 1987, Take Charge America, Inc. (TCA) is a non-profit 501(c)(3) organization headquartered in Phoenix, Arizona. TCA offers a variety of services including financial education, credit counseling, and debt management. TCA’s programs are utilized by tens of thousands of families and individuals each year. To learn more about TCA or its programs please call 1-800-823-7396 or visit www.takechargeamerica.org.