Newlyweds and debt can be a bad combination. Over the past 21 years I have given so-called financial counselling to many engaged couples. “So-called” because it’s never finances but lifestyle choices that lead to money challenges. Usually, at least one of these guys and girls has over $40,000 student loans and credit card debt combined. Typical for 50% of these couples, one has no debt. And almost 100% of them have not discussed their attitudes and approaches to handling money with the other. Generally, they ask me three questions:
- Should we wait until one pays off his or her debt before getting married?
- How should we manage our money after marriage?
- How do we build our credit scores to enable us to buy a house?
I will address the first question here. In a later blog, I will deal with the others.
How long will you Wait to pay off debt Before Marriage
I have not heard a logical or reasonable answer for waiting to repay debt before marriage. One person, Jack, said he felt better if he entered marriage debt free because his fiancé, Patience, had no debt so he thought this was only fair.
“How long will you wait?” I asked.
“As long as it takes.” Jack replied.
“Have you done a debt repayment schedule, Jack?”
After doing a debt repayment schedule, Jack realized it would take seven years at current rates to repay his debt. “Hmm; I didn’t realize this.” He said.
My counsel was, and is, simple. Ensure you are getting married for the right reasons. When those reasons exist, go for it. As a follower of Jesus, I believe for each man, God has chosen a “perfect” wife, or He has given him the gift of singleness. Likewise, for each woman. As we can see from the creation story and elsewhere in the Bible, God instituted marriage and identified particular roles for the man and for the woman (Ephesians 5:22-32). Therefore, I suggest to each couple to pray and ask the Lord to show him and her the person God chose. Most of all, I stress that they don’t link extraneous events with God’s choice and timing.
Three Newlyweds Case Studies
Tony and Patsy married when Tony was in his final year of college. Tony had a small loan from his parents and Patsy was debt free. They weren’t followers of Jesus but they were committed to each other for life and decided they would marry. Meanwhile, Tony would attend college full time and Patsy would be the sole income earner until Tony finished college. Their decision reflected the fact that after marriage they would be one and would handle money as one pool. They agreed an approach to spending, budgeting, and decision making and have followed that since. Money matters have never caused an issue in their marriage.
Joshua and Rebecca married with no debt. They did not discuss budgeting, spending, or decision making. Indeed, they both assumed all would be well because they started debt free. They agreed Joshua would “control” the family finances. However, they did not handle decisions jointly and did not review finances together. Sadly, Joshua made bad choices and the couple ended up over $75,000 in credit card debt. They are still dealing with this debt, and fight constantly about money, though their issue isn’t money.
Simon and Yvette entered their marriage with $40,000 of Simon’s student loans. They agreed an approach to handle the family finances by budgeting, a pre-spending review process, and regular family council meetings. They believe they must save before buying, pay credit card balances fully each month, and avoid consumer debt. In 18 months they were debt free and saving to buy a home. Money has never been an issue in their marriage, though they have had to delay getting items most couples their age have.
Let the Lord Lead Your Decisions
Newlyweds, it’s not your financial condition at the start of marriage that will decide your financial future. By God’s grace, it’s your ABCs (attitude, behaviour, and choices) during marriage that will be paramount. These three cases and several others I have dealt with confirm this fact. It’s important newlyweds allow the Lord to guide all decisions. Meanwhile, engaged couples, try to understand the following issues before you marry:
- As followers of Jesus, the Bible states clearly the husband and wife become one at marriage, so you need to live as one. This means there is one pool of funds in the marriage, not his or hers, but God’s (Genesis 2:24).
- Both parties must be transparent about finances before marriage. Everything must be on the table. Each of you should say how you got into debt and what you are doing about it. The goal is to understand each person’s attitude to money: views about credit cards, savings, home ownership, renting, further study, student loans. It’s important to be on the same page.
- Before marriage, you must agree an approach to handle finances during marriage. It’s not a matter of meeting each other halfway. There is a way that will keep you debt free, choose that path. I recommend working with a budget; have a regular review of where you are and changes needed, if any; agree a process to decide spending; set up a capital fund, and most of all, decide a process to settle disputes. This last point is critical.
Why do you Want to Wait
Usually, when one party decides to wait to repay debt before getting married, something else is driving that decision. My experience is once the couple discusses this alone or with a counsellor, issues become clearer and they allow the Lord to help them decide when to marry. It’s been a great joy to see God work in these couples’ lives.
If you are in the waiting zone to become newlyweds, surrender your decisions to the Lord and watch Him work.
For more on this topic, read chapter 12, The New Managing God’s Money-The Basics.
(C) 2017 Michel A. Bell