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There isn't much worse than the feeling of being trapped. You can be in a beautiful home, with a loving partner and wonderful children, but if you don't have control of your finances, it can all feel like it's quickly crumbling down around you.
For many couples, financial problems in marriage can sadly lead to depression and addiction, and, more often than not, will eventually end in divorce. With that, the family home is lost, the kids are uprooted, and all of a sudden, everything feels out of control.
It's not all gloom and doom, though. For those couples that take the time to learn about financial planning, credit management, and income growth strategies, there is hope for a better future – both financially and emotionally.
THE ROOT CAUSE OF FINANCIAL PROBLEMS IN MARRIAGE
Before we can explore the solutions to financial problems in marriage, we first need to understand what's causing them. And while many factors can contribute, by far the most significant root cause is a lack of education on handling finances and credit.
You see, we're not taught how to handle money or credit properly in school. We're not given any real guidance on how to make our income control our credit, and how our credit should control our money.
As a result, many couples find themselves in a situation where they're simply unable to keep up with their finances. They rack up debt, miss payments, and end up with sky-high interest rates. All of this puts a tremendous amount of stress on the relationship, and eventually leads to the aforementioned problems.
PREVENTING MARRIAGE MONEY ISSUES
So, what can be done to prevent this? Well, it starts with financial education. It's never too late to learn about money and credit, and to start applying that knowledge in your own life. There are plenty of resources out there, including books, websites, and even courses offered at local community colleges.
It could be the best decision you ever make. And, it's what may even eventually help you move on from your divorce and create a bright future for yourself and your family. Happily ever after doesn't always happen. But, with the right knowledge, you can still have a beautiful life - even if it means starting over.
With that being said, let's dive into some of the financial mistakes that can prevent you from having a happy marriage, and how you can avoid them.
MARRIAGE AND MONEY: FINANCIAL MISTAKES
Not Understanding Credit Score
One of the most prominent financial mistakes people make while married is not having a clear understanding of credit scores. A credit score is a crucial 3 digit number that lenders look at to determine your financial risk. The higher the number, the lower the risk, and the more likely you are to be approved for loans and lines of credit.
If you're not familiar with your credit score, or you don't understand how it works, you're in for a world of hurt. You could be turned down for loans when you really need them, or you could be paying higher interest rates than necessary on your credit cards and other debts, leaving nothing for emergencies.
If you don't know your credit score, now is the time to find out. You can get a copy of your credit report from ScoreNavigator, and even a suite of credit score solutions to help you reclaim ownership and control of your financial life.
Financial Baggage
When two people tie the knot, they often bring with them a host of financial baggage. This can include things like student loans, credit card debt, and even past bankruptcies. It's important to be honest with your partner about this baggage from the very beginning. Otherwise, it could come back to bite you later on down the road.
If you're not sure how to have this conversation, consider seeking out the help of a financial planner or therapist. They can help you navigate this tricky conversation, and set you on the path to a bright financial future.
Opposing Attitudes Toward Money
Savers and spenders; they exist in every relationship. And, when it comes to money, these two personality types often butt heads.
One of the best things you can do for your financial future is to find a middle ground between the two extremes. Make a budget that allows you to save money each month, while still giving you some wiggle room for fun purchases. This will help keep your relationship from deteriorating over money disagreements.
Not Policing Credit Data
Another big mistake people make is not policing their credit data. This is information that's being reported about you to the credit bureaus, and it includes things like your payment history, outstanding balances, and credit limits.
If you see any errors on your credit report, it's important to dispute them right away. Otherwise, they could end up dragging down your score, making it difficult for you to get approved for loans in the future.
ScoreNavigator can help you keep track of your credit data and ensure that it's always up-to-date and accurate.
MARRIAGE AND MONEY: FINANCIAL SOLUTIONS
Now that we've gone over some of the biggest financial mistakes people make during their marriage, let's take a look at some solutions.
Hire a Financial Planner
If you're feeling overwhelmed by your finances, it may be time to hire a financial planner. A good financial planner can help you create a budget, pay off debt, and save for the future. They can also provide invaluable advice during times of financial stress.
Hiring a financial planner is one of the best things you can do for your financial future. Just make sure to do your research before settling on someone. You want to make sure that they're qualified and that you're comfortable working with them.
Get Educated
It all comes back to this, doesn't it? If you want to avoid making financial mistakes during divorce, you need to get educated about personal finance.
Study finance rates, how to improve your credit score, and basic money management principles. The more you know about personal finance, the better equipped you'll be to handle your finances during your marriage, and can ensure it's a happy one!
Set Up a Budget
One of the best things you can do for your finances is to set up a budget. This will help you keep track of your income and expenses, and ensure that you're not spending more than you can afford.
There are a lot of different ways to set up a budget. From simply putting pen to paper, to using one of the many budgeting apps available. Find a method that works for you, and stick to it.
Pay Off Debt, Together
If you and your spouse have a lot of debt, it's important to start paying it off as soon as possible. The sooner you can get rid of this debt, the better.
One way to do this is to create a Debt Reduction Plan. This is where you list out all of your debts, from smallest to largest. Then, you focus on paying off the smallest debt first. Once that's paid off, you move on to the next one. This method can help you pay off your debts quickly, and it'll give you a sense of accomplishment as you go.
Another option is to consolidate your debts into one loan with a lower interest rate. This will make it easier to manage your payments and will save you money in the long run.
FINAL THOUGHTS
Don't let your family suffer because of a lack of education on personal finance. Instead, take the time to learn about money management, and avoid losing the people that matter most to you. They are just numbers and figures, and aren't worth the heartache and pain that come with the financial crisis of divorce.
When you understand how finance, credit, and income work together to create a solid future, you gain the power to change those three digits. And if you need a helping hand? Well, we're always here for you.
ScoreNavigator is the leading financial education platform, helping people just like you learn about personal finance and credit. We offer a suite of credit coaching services and financial tools to help you improve your credit score and get on the path to financial success.
If you're ready to take back control of your finances, visit our website today or pick up the phone. We'll be with you every step of the way!
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