I just watched Ali Wong’s Netflix comedy special(hilarious, btw) and in it she reveals her scheme to trap her Harvard Business School graduate husband, only to find out, after they get married, that he is $70,000 in debt. Luckily for Ali, she’s a writer for a popular TV show, and funny enough to get a Netflix special, so she was able to pay it off easily and move on.
But what about those of us who don’t have celebrity money to just make our debts disappear?
If you are even contemplating marriage to someone, and you have a tremendous amount of debt, you owe them a conversation about it…at the very least. I believe that honesty is essential to a great marriage, and keeping $70,000 in debt to yourself until you and your spouse go to apply for a mortgage together is not honest. I would say that’s a pretty big secret to keep and I wonder how the rest of your marriage will be if this is how you are starting.
They say the first year of marriage is the hardest. I believe they say that because it seems to be common practice to keep secrets until the wedding day, and then only when you are married do you tell your spouse about your crazy debt, alcoholic binges, or illegitimate children in Alberta.
Please do yourself, and your future spouse, a favour, and talk about this stuff as soon as possible. Perhaps you are ashamed and I understand that, but that doesn’t mean it will be any easier if you wait. You are asking someone to make a huge commitment to you and at the same time, share your financial burden. To legally affiliate yourself with someone without full declaration of your finances is not a great way to kick off the rest of your life.
Another great effect of this conversation with someone you love may be that it helps you realize why you are in so much debt in the first place, and why you feel you have to hide it from the world.
Let’s talk about debt for a second. There is good debt like a student loan or a mortgage. These are things that will provide you with huge benefits down the road, like greater earning potential, or an asset(that hopefully appreciates!). Then there is bad debt like credit card debt, or that loan you took out to buy the car you couldn’t afford and didn’t need.
If you have good debt, then you should disclose this to your partner immediately, even if you aren’t thinking about marriage yet. What’s the risk? Are they going to think less of you because you went to school to better yourself, or bought a house to live in? Probably not. So talk about it right now!
If you have bad debt, you may feel like you want to wait a little longer because you are embarrassed about your past(or continuing) behaviour. I understand this, but you will have to do it sometime, so don’t wait too long. And at the same time, check yourself about why you have so much debt? What can you do to get out of it? Crippling consumer debt caused by past life situations can be resolved with the help of a consumer proposal or bankruptcy. These options may seem extreme, but they are in place for a reason, so that you can make mistakes in your life and not ruin it.
Talking about debt, and finding ways to get out of it, is the first step on the road to generating cash savings and then investing it wisely.