Money and Marriage: Living With Financial Freedom

For many couples, money is a tough topic.  That’s why, for the past couple of months, I’ve been using the first post of the month to focus on ideas for making money work in marriage.  It’s also why I created a financial workshop to help engaged and newly married couples get their relationship started in the right financial direction.

In August, I wrote about the importance of knowing where each other is coming from, financially speaking.  Last month, the focus was on knowing where you’re going.  This month, I’m looking at a financial issue that, like no other, causes financial discomfort among couples and raises the chances for financial fights: debt.

Take Off the Shackles

The Bible says, “The borrower is servant to the lender.”  Living as a servant to a lender isn’t wise for any of us, but it’s especially problematic in marriage.

Researcher Jeffrey Dew at Utah State University has found that not only does consumer debt (credit card debt and other installment loans) fuel a sense of financial unease among couples and increase the likelihood that they will argue about money, but “this financial unease casts a pall over marriages in general, raising the likelihood that couples will argue over issues other than money and decreasing the time they spend with one another.”

Dew’s research shows that newlyweds that take on substantial consumer debt become less happy in their marriages over time. On the other hand, newly married couples that pay off their consumer debt within their first five years of marriage are more satisfied with their marriage. Those findings held up no matter whether couples were rich or poor.

Whose Debt Is It?

How couples approach their debt is important as well.

When Scott and Karen got married, Karen brought $50,000 of non-mortgage debt into the marriage.  Scott jokingly referred to it as a reverse dowry.

One of the things I love about their story is that from the earliest days of their marriage, whenever Karen would talk about “my” debt, Scott would correct her by saying is was “our” debt. Now there’s a guy who is committed to financial oneness.

One other notable part of their story is that their faith-based convictions motivated them to give away 10 percent of their income throughout their journey of getting out of debt. Karen remembered seeing their year-end giving statement, and thinking, ‘Gee, we could have gotten out of debt so much faster if we had put that money toward our debts.” And she remembers hearing other people’s stories of unexpected blessings they felt came about because of their giving. “I started wondering where’s my cool story?” she said.

Six-and-a-half years after getting married, Scott and Karen made their last debt payment. It was a day neither one of them will ever forget. “It was amazing,” Karen says. “We felt like it was a hard road we had traveled, but we did it, and we did it in a God-honoring way. We are 100 percent debt-free.”

Scott will soon be able to retire with a full pension at a much younger age than most people, having put in over twenty years as a Chicago firefighter. They’re thinking about getting an RV and spending a year traveling the country.

Sounds pretty cool to me.

Be Done With Debt ASAP

If you are engaged or newly married, make it one of your highest financial priorities to get out of debt and then live the rest of your lives with no debt other than a reasonable mortgage (One that requires no more than 25% of monthly household gross income to pay for the combination of your mortgage, taxes, and insurance).

Put together a spending plan that enables you to maximize debt repayment.  You may find it helpful to use the recommended spending plans found in the “Money, Purpose, Joy,” workbook, which contains detailed plans for four different size households across nine different annual incomes.

Very often, when couples get married they get excited about all that they’ll be able to afford with two incomes.  However, if you have debt, I strongly encourage you to base your lifestyle mostly on one income, using the other income to get out of debt and build savings.  Doing so will make all the difference in helping you build a solid financial foundation and live with financial freedom.

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