How to Tackle Debt as a Married Couple

nj debt relief

Marriage is about two people joining their lives together. Making the decision to spend the rest of your life with someone also means sharing financial decisions and taking care of debts together. Both parties may be entering the marriage with student loans, credit card debt, or personal loans. While in New Jersey you are not legally responsible for debt your spouse accrued before your marriage, you will become a financial team with your spouse. This means helping each other tackle debts both from before and after you say “I do.” Here are some tips on tackling marriage debt and subsequently reducing the financial stress in your relationship.

While ideally you should enter into a marriage with a full understanding of your spouse’s financial situation, it is never too late to sit down and have the money talk. Overcoming debt together requires open, honest communication about what you bring to the marital table financially. Don’t just talk about your debts, talk about your goals, too. What will paying off this debt allow you to do as a couple? Setting financial goals together will allow you to both motivate each other and hold each other accountable.

It’s important to keep in mind that you are in this together. After marriage, individual debt becomes “our debt.” Couples who have the most success tackling debt together tend to face their financial situation as teammates. Focus less on who brought more debt to the table and more on how each of you can contribute towards the goal of paying down the debt. Instead of only focusing on your debt individually, you will be able to stretch your money farther. Paying off debt when you’re working with two incomes will be easier than doing it alone.

Learning how to budget for two people (or more if you have children) will be very important to paying down your marriage debts. Don’t assume you and your spouse are on the same page about sticking to a specific budget. Sit down and determine how much money is coming in and out of the household on a weekly and monthly basis. You should both have a good understanding of your living expenses, debts, and financial goals. Be honest with your spouse about any financial difficulties you might be facing and see how you can fit this into your budget as a couple. After you know what your shared budget is, you will be able to come up with a realistic plan to pay off your debt.

Once you have a budget in place and a plan to pay off your debts, make sure you keep the conversation going. Check in with each other to make sure the budget you set is still in line with your financial realities and that you are making progress towards your goals. Like marriage, paying off debt is a long-term commitment that requires a lot of dedication and flexibility. Be patient with yourself and your partner as you take on the task of ridding yourselves of debt.

Make tackling debt together part of your goals as a couple. Financial difficulties are the leading cause of marital stress. If you have been struggling to pay down your debts and it is creating a strain within your marriage, it may be time to seek outside help. Veitengruber Law offers debt solution services to help you manage your debt and get back on track to financial health. Don’t hesitate to reach out to us for a free consultation.

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What if I Can’t Pay Back my Personal Loan?

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Personal loans, unlike student loans, mortgages, or auto loans, can be used for almost anything. If approved, you receive a lump sum that must then be paid back in monthly installments. From big purchases to home renovations to consolidating debt, a personal loan can be a useful financial tool. But sometimes, as with anything else, “life happens.” Unexpected financial difficulties like a pay cut or medical expenses can disrupt even the most carefully planned budget. When a financial set-back occurs, it can be difficult if not impossible to keep up with bills and payments. Often, it is loans and credit cards that are the first payments to be put off. What do you do if your situation has changed since being approved for a loan and you can no longer make payments on your personal loan? Today we’ll give you a few examples of steps you can take to remedy the situation.

While most people are reluctant to talk to their lender in the event of a financial set-back, this is often the best thing you can do. In fact, most lenders will respect a proactive approach to handling the situation and appreciate your dedication to paying back the loan. The sooner you make your lender aware of the problem, the more likely they are to work with you. On the other hand, simply ignoring missed payments can result in an accumulation of late fees, collection efforts, a drop in your credit score, and even default. If there is a valid reason you cannot make the payments, your lender should understand and work with you to find a mutually agreeable solution.

Once you have taken steps to make your lender aware of your situation, they may be willing to revise the terms of your loan to make monthly payments more manageable for your new financial circumstances. Lenders who are willing to negotiate will look at your expenses, other debts, and income to determine a more realistic monthly payment. So while the total principal of the loan will remain the same, payments can be made more affordable. The solution might even be as simple as changing the monthly due date of the payments to a time when it does not conflict with other bills. You may even be able to negotiate a deferment on your payment—it doesn’t hurt to ask!

If your lender does not work with you to revise the terms of your loan and is still demanding on-time payments, you will have to find different ways to make the payments. Consider areas in your budget you could cut back on, even if it is only until you’ve paid back the loan. Determine which expenses are necessities (like food, utilities, transportation to work, etc.) and which are extra. If it is possible, try selling high dollar items, like a second car. You may even consider doing side work or getting a part-time job to help offset the cost of the loan payments. Explore all of your budget-revising options to avoid missing payments.

In the event you still cannot afford to make the payments on your loan, don’t assume all hope is lost. When you’ve done all you can do to remedy your finances and you’re still struggling, it is time to reach out for professional help. At Veitengruber Law, our team of experts has years of experience dealing with difficult lenders and assisting borrowers in getting back on the right financial track. We will negotiate with lenders on your behalf to find effective solutions for real financial relief.

We understand that not every debt problem is the same and we will work diligently to come up with a customized solution for your specific situation. Bankruptcy is not the only solution to unmanageable debt, although it may be the best solution for your circumstances. Our team will perform a holistic financial analysis to help you make informed choices about your financial future.