Discussing and Solving Debt with Your New Spouse
Take charge of your debts
If you're not sure of the exact status of your debts, a credit report will provide a detailed history of what you currently owe and if any payments have been late or are missing. Your first and perhaps most important job is to ensure that the report is complete and accurate. Inaccurate or incomplete information can damage your credit rating -- and it is up to you to document the errors and make sure they are corrected. Managing your debts and credit history is extremely important and all too often overlooked.
Create a plan
Determine what your financial obligations are and, together, create a strategy to reduce and eventually eliminate your debts. Expect the unexpected and have contingencies in place should you become unable to continue your payment plan due to a job layoff, an unexpected major expense or medical emergency. Be aware that your current debts may limit your ability to make major purchases and determine how that will impact your future needs. Having children is stressful and costly even under ideal circumstances, so it pays to tune up your finances before having children.
Reducing or eliminating debt
Determine a realistic amount you can afford each month and a timetable for paying down your debt. Evaluate every few months how well your plan is progressing and make necessary adjustments to pay off as much as you can without adding undo stress. Even though some strategies to reduce your debt seem obvious, they shouldn't be overlooked. First and foremost, don't make purchases that will add to your debt. Contact your creditors and try to negotiate a lower interest rate. This may or may not be possible, but couples won't know if they don't try.
When paying down debts, eliminate the debts that boast higher interest rates first. See if you can transfer card balances to a card with a lower interest rate. Find ways to cut spending by living on less. This should leave more room to enjoy your new life together, and enable each person in the relationship to improve their credit rating as well. The first step to financial success is to make a plan. All steps thereafter should adhere to that plan.