The act of marriage itself won't affect your credit score or your partner's. However, during the course of your marriage, your credit or theirs is likely to have an effect on both of you.
Also, an individual's credit score can be a reflection of their spending habits and ability to be financially responsible. Therefore, if only one of you has good credit, this could be a problem. This is because even though your credit scores remain separate, many of your financial decisions may be made together. So everything will be much easier if the two of you are on the same page when it comes to money and credit.
In addition to causing friction, one partner's bad credit could prevent you from sharing the burden of a large purchase. So it's important to talk about financial goals so that you and your spouse can create a plan that will allow you to achieve them together.
Earning Good Credit to Make Large Purchases Together
If either you or your spouse has bad credit, hopefully this was revealed before the wedding. Marriage is difficult enough, so it's good to know about the challenges you might be facing ahead of time. If you and your partner ever decide to buy a car or a house together, both of your credit histories will matter.
Do both of you have less than perfect credit? Then both of you should work on improving your individual scores. If you and your spouse have similar credit goals, you may be able to work together and encourage each other.
On the other hand, if only one of you has bad credit, this person has to commit to making some changes. While the partner with good credit can certainly help the other one, the person with the low credit score must be willing to help themselves.
A married person with good credit can make their spouse an authorized user on an existing credit card account. This way, both sets of credit reports will reflect the positive payment activity associated with the account. The person with the poor credit score should notice a gradual increase in their rating as long as all payments are made on time. Also, the account balance should be kept below 30% of the card's spending limit.
Of course, both of you should understand that when an authorized user is added to a credit card account, activity associated with this account will affect both credit scores. So this is where communication will be absolutely necessary. If the partner with the imperfect credit history ends up damaging their spouse's credit by doing something irresponsible, nobody wins. And this certainly won't help the marriage.
Working Toward One Credit Goal with Two Credit Histories
Financial trouble can wreak havoc on a marriage, and how well you and your spouse manage credit can make or break your finances. As a married couple, it's understandable if you want to share everything. In fact, your first impulse may be to immediately apply for joint everything, banking accounts, credit cards, etc. But before you merge financially, it's a good idea to sit down with your spouse and have a serious talk about money and credit.
1 - Discuss Your Credit History
If you're the one with bad credit, you may recoil from this idea. Talking about credit mistakes can, after all, be embarrassing. But this should be seen as an opportunity to speak honestly about what went wrong with someone you trust. After this discussion, the two of you can come up with a plan to prevent past mistakes from happening again.
2 - Delegate Payment Responsibilities
Figuring out who is in charge of paying for what seems simple enough. But you should be as organized as possible with your payment plan so that there's no room for misunderstandings. Some couples have found it helpful to share a Google calendar that contains all of their due dates. This way, it's easy to see who is supposed to pay what and when. You can even set up email/text alerts if you're the forgetful type.
3 - Hold Each Other Accountable
It can be difficult to tell a loved one that they're being careless with money, but sometimes you have to. If you're a saver who's married to a spender, be firm but patient when addressing the issue. Try to understand that habits are often hard to break. On the other hand, if you're the one who needs to be reigned in, don't immediately go on the defensive. If your spouse confronts you, remember that they're doing so for the good of your shared future.
As one half of a married couple, you have to remember that facing life's challenges is now a team effort. And this applies perhaps most significantly to your financial and credit goals.
Auto Loan Assistance for Couples with Bad Credit
If one or both of you need a car, but you're worried that your damaged credit will stand in the way of financing approval, Drivers Lane can help. At no cost, we can match you with a dealership in your area that can work with your situation. You may even be able to purchase your vehicle with little or no money down.
You'll get a better chance at auto loan approval without having to waste time or money. Applying with us is also obligation-free. So go ahead and fill out our simple and secure online application to get started today.
