A few months ago, my friend Kaila called to invite me over to her house for dinner. We had made plans to meet up that night at one of our favorite local restaurants, but she explained over the phone that eating out didn’t fit into her budget any longer. She was trying to live very frugally over the next six months because she was working to pay off the last $10,000 of her student loans. I thought it was a great idea, but I wondered what had brought on this big push to pay it all off. She had been talking to her boyfriend about getting married and had realized that she didn’t want to get engaged until she was out of debt, she informed me.
Getting married is a chance to start a new life together. The opportunity for a fresh start might be why some couples wait to get married until they’re debt-free. Whether their debt is in the form of credit card debt, student loans or car loans, these couples worry that debt will impact their marriage and their relationship and decide to do everything they can to either reduce their debt or get rid of it entirely before tying the knot. The marriages that they enter into, which I have dubbed No Debt Unions (or #NoDebtUnions), are stronger because of this.
There are a number of reasons why couples choose to start their lives unencumbered by debt. One obvious reason is that weddings can often be expensive and for a couple who’s already in debt that can make their special day even more stressful. Another factor is that like with Kaila, the debt often belongs to only one half of the couple and that person feels a personal responsibility to tackle that debt before combining their financial future with someone else. In a 2006 study featured in the Journal of Extension, the researchers found that debt distracted couples from the process of building a healthy marriage during their first months and years of marriage. Debt affected marital adjustment and marital satisfaction rates and was seen by couples as the biggest issue in their marriage. A study by Utah State University shows that money problems are one of the leading causes of marital arguments, with money starting arguments 30 percent of the time.
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For those who don't want to rewrite their wedding vows to read “till debt do us part,” efforts to pay off or reduce debt help couples start their marriages off on the right foot. By eliminating debt before getting married, couples set themselves up for a happier and stronger marriage. The couple that pays off debt together might be the couple that stays together since the process of paying off debt can bring them together. There is nothing more exhilarating than being able to celebrate paying off debt.
That was certainly Kaila’s experience. She finished paying off her debt in September and got engaged in October. For Kaila, paying off debt before getting engaged was a choice she came to on her own: “I wanted to make sure my finances were in order before Scott and I joined assets and lives. I didn’t want to bring my student loan debt into our marriage.” Still, Scott’s support was key, “We lived together while I was paying it off and Scott helped by being supportive and not tempting me to spend money. I was putting more than 50 percent of my take home pay towards my student loan balance so we had to live very spartanly for six months. We got really creative. That allowed us to go through the process of paying off debt together. It just confirmed what a great team we are.”
Now that Kaila’s paid off her debt, it’s motivated her and her fiancé Scott to save together for their future goals, “We know what is possible now in terms of savings so we have set up a joint savings account. We’re going to try to live on only one of our after-tax incomes and save the other income starting in January. That money will go towards a down payment on a condo and our wedding.”
If you’re hoping to have a No Debt Union, consider taking the following steps to pay off or reduce debt before getting married.
|Talk About Debt|
Whether or not you want to pay off or reduce your debt before you get married, it's important to talk openly about debt. Make sure your partner knows everything they need to know about your financial situation. We don't just marry individuals but we marry their financial situations and habits as well. While some couples find ways to overcome different financial values and philosophies, for many it's important to find a compromise. Money is such an integral part of our lives that if you can't talk to your partner about finances in a constructive way, it can lead to problems later on.
|Create a Plan|
You need to determine how long it will take for you to pay off your debt. Many couples decide to cut back on their expenses as much as possible in order to accelerate their debt repayments, but if you’re already fairly frugal this might be difficult or impossible. If that’s the case, you might consider taking on a second job or starting a side hustle to make more money to put towards your debt.
There are other things that you might be able to do to help accelerate your debt repayment. By consolidating your federal student loans or refinancing your private student loans you may be able to save money on interest and accelerate your payments. Or consider using a low-interest personal loan to consolidate your credit card debt.
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Paying off debt might mean cutting out trips, going out with friends less or sacrificing other small luxuries. But that doesn’t mean you can't have fun while you're paying off your debt. Do what Kaila did and invite friends over for dinner or a potluck rather than meeting up with them for an expensive meal.
If you have too much debt to possibly pay off before you get married, work on reducing it instead and come up with a plan to accelerate your debt repayment after you get married. While many couples who opt for No Debt Unions want to get rid of that before they get married, others are willing to work on debt reduction together after marriage.
|Stick to Your Plan|
Once you have a plan, the next thing you need to do is stick to it. This can be harder than it sounds as there are often temptations for you to spend money. Do what Kaila and Scott did and support each other in your debt repayment. Don’t tempt each other to splurge but instead find fun ways to allow the debt repayment process to bring you closer together. Kaila and Scott found that they enjoyed cooking together and took the opportunity to improve their culinary skills.
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Remember that no matter what you do, there will also always be the potential for emergencies to sidetrack your plans. Do your best to stick to your original plan and don't get too discouraged if you fall a little behind.
Set milestones in your debt reduction that you can celebrate along the way. For example, you might want to celebrate every time you meet your monthly goal or you might choose to celebrate only when you reach certain significant milestones like paying off one quarter, one half, or three quarters of your total amount. Just make sure that your celebration doesn’t cost a lot of money and take you off track.
After all, getting debt-free has a lot of perks. It can help you buy a home and can improve your credit score if you pay down credit cards that had been overloaded with debt.
While it might be difficult to pay off your debt, for those who want to enter into their marriages without any financial baggage it is worthwhile. The last thing you want is to have debt become the source of fights and tension in your marriage.
Any opinions expressed in this column are solely those of the author.