How Financial Mismanagement Impacts a Marriage

Marriage is not something that should be entered into lightly for many reasons. Bringing together two people from varying backgrounds can either work well for the couple, or it could help lead to difficulties early on and often.

One issue that causes strife between couples is money. In fact, financial problems still rank as a top reason many marriages end in divorce. What is it about money that drives a wedge between even the closest of people? Explore some of the reasons for this startling statistic and how to avoid it from happening to you.

How Financial Mismanagement Impacts a Marriage

Varying Views on Money Handling 

People grow up in different socioeconomic situations. Some people get a strong sense of money handling while others learn to live paycheck to paycheck. A healthy viewpoint on money must be taught from the beginning. When this doesn’t happen, it may lead to poor choices that often start in college.

Debt has become the norm when it comes to getting a college education. Not just that, but credit card companies depend on young adults wanting to purchase things without the income to do it. When people begin adult life in debt, it can set the tone for the way they handle money.

Financial Baggage 

When a couple begins dating at any age, they bring with them ideas, principles and baggage from previous life experiences. In first marriages, it is naivety when it comes to how much money it may cost to live. In second marriages, however, the stakes are higher. While a couple may be older when they marry again, they almost always bring with them financial baggage from a previous marriage. Child support and alimony dock a person’s pay right from the start.

Even if they have advanced in a company and could live comfortably, the stress of losing a part of a paycheck every month may lend itself to strife within the marriage from the beginning. Second marriages end at an even higher rate than first marriages, with 74% calling it quits amid financial burdens.

Couple Poor Habits 

Establishing good habits as a young person is one key to staying out of debt. While there are some situations where debt is unavoidable, like a long-term illness or serious injury, a person with sound financial habits may have money stashed away for this type of impactful life events. More often, however, the need to buy things without the financial soundness to do so in cash is ingrained. When one spouse is more of a conserver, and the other is not, it can cause tensions to escalate, especially in the face of illness or job loss.

Keeping Up With the Jones’s 

Social media is a blessing for those who wish to connect with old friends, family and like-minded individuals across the miles. Relationships can remain intact with the ability to peek into each other’s lives at any time and see pictures of kids growing up and celebrating milestones. However, there is another side of social media: envy. When you see friends and family on vacation, moving into larger homes, and seemingly having it all while you struggle to make ends meet, it can place an extra strain on a relationship.

Keeping up with the Jones’s is not a new concept. It is the act of maintaining an image for the sake of others, even when the reality is in stark contrast to that image. Going deeper into debt to take extravagant trips or purchase faster cars almost always lead to marital conflict. When one spouse has a high-profile job, this need to impress may escalate and become worse.

Tips for Getting Out of a Debt 

A couple on the verge of financial collapse and personal ruin has a few choices in how to proceed. They can fall apart and divorce, splitting debt, remaining assets and time with children. If this is not something they want to do, then the next step would be getting on the same financial page to improve credit and tackle debt together. Some strategies for doing so include:

• Getting on a monthly budget
• Giving up credit cards
• Selling unnecessary toys, like boats and cars
• Downsizing the family home
• Cutting all extemporaneous spending
• Working extra hours or jobs to build more income

The money saved should all go towards debt. In time, and with a certain measure of sacrifice, a couple may find themselves out of debt.

The only way any of these strategies work is if both spouses are dedicated to making it happen. One can’t be secretly spending money and opening up credit cards while the other is working extra hours and not spending a dime. The process of becoming debt-free is not easy, but doing so as a team may help ensure it works.

Allowing financial strain to end your relationship with your spouse is not something that happens overnight. Learning then to curb the spending, communicate honestly and openly about money issues, and establishing a healthier view of money may help keep a couple together for years to come.