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Couple standing face to face (Hemera Technologies/(C) 2006 Hemera Technologies)
Couple standing face to face (Hemera Technologies/(C) 2006 Hemera Technologies)

Book Excerpt

Treat your marriage like a business Add to ...

If your partner has problems with alcohol, drugs or gambling, he or she literally can't think straight. Financial progress takes a backseat to feeding the addiction. Recovery is always possible, of course, but you'd be smart to get counseling (even if your partner won't go) and attend a support group such as Al-Anon, Nar-Anon or Gam-Anon. (Our message board poster wrote that her husband had a longtime drinking problem, and no interest in pursuing treatment; last we heard, she was pursuing a divorce.)

There's a mental disorder.

Overspending can be a symptom of a number of mental problems, including depression, bipolar disorder and attention-deficit/hyperactivity disorder (ADHD). Adults with these conditions may not be able to resist impulse spending or to tend to the details of their finances, leading to big debts, late fees and other fallout. Again, progress is possible, but the underlying disorder must first be properly diagnosed and treated. (After a huge fight about their finances, the woman who had taken out payday loans sought help from a counselor, who diagnosed her with ADHD. Treatment and medication helped reduce her symptoms. She decided she couldn't handle credit cards and now uses a debit card linked to a checking account with no overdraft privileges.)

There's no acknowledgment of the problem.

This may be the hardest nut to crack. Your partner either doesn't see what you're worried about or blames the problem on you. Counseling and sessions with a financial planner may help, but if your partner takes no responsibility and instead blames others, prospects for improvement may be dim. That was Jennifer's situation with her husband, and she counts herself lucky that the marriage lasted only as long as it did.

Many people try to insulate themselves from an overspending spouse by keeping separate accounts, but there's a big danger in that: you can't see what he or she is up to. Separate accounts can allow profligate partners to run up big secret debts. In any case, simply setting up separate accounts while you're still married may not protect you from your spouse's financial missteps.

In community property states, which include Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin, debts incurred during marriage are typically considered joint debts. In other states, debts can be considered joint if they were incurred for family necessities, such as food or shelter. Even when a debt is the sole responsibility of one partner, some states allow creditors to go after jointly owned property if the debt is not paid.

You can get an idea of your liability, and what you can do to protect yourself, by talking to an experienced bankruptcy attorney who knows your state's laws. You may be able to legally wall yourself off from your spouse's debts, even in community property states, through a document known as a postnuptial agreement. Or you may decide to divorce rather than incur further liability.

For most couples, though, the picture isn't nearly so bleak. Even

those with drastically different money skills and approaches can find a compromise that works. Couples who work out their financial differences usually do so by taking the time to understand each other's point of view and being willing to compromise, financial experts say.

"It comes down to . . . how they deal with conflict," says Sandra Wang, a financial adviser with Morgan Stanley Smith Barney in Palo Alto, California, who is also a licensed marriage therapist and a certified divorce financial analyst. "It takes a lot of work, and a lot of people don't want to do that."

Besides, money can be extremely tough to talk about, says financial planner Tracy B. Stewart of College Station, Texas. Many couples with financial disagreements find they need a third party, such as a counselor or a financial planner, to help them navigate these tricky issues.

"They're better off with a third party, because it's going to be emotionally charged for both of them," says Stewart, a CPA who is also a personal financial specialist and a certified divorce financial analyst. "Money is up there at the top of emotionally charged issues."

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