AIBU about DH's debts?

[KitKat1985]

Hello.

Me and DH have been together about 5 years (married a year and a half). He's never been great with money whereas I've always been very cautious (very much of the if I don't have the money I won't get it, and have never had a credit card). I have no debts with the exception of our joint mortgage which we have paid each month without fail since getting it nearly 4 years ago. DH has a credit card which he originally used to owe a few hundred on but over the past couple of years this has crept up to about £3000. On top of this 3 years ago he took out a 5 year finance deal on a second-hand car (I was never happy about it, but we were unmarried at the time and I didn't feel I had any right to tell him what to do). The car has been a bloody nightmare since the day he got it. It has cost untold hundreds, probably 2-3 thousand, in repair bills (indeed it's been responsible for a lot of the credit card debt) and after 3 years he wants to replace it and cut his losses (which I can see his point) but he still has 2 years worth of payments left on it worth just over £2600 and will only be able to afford a new car by me giving him a lot of my savings. So in total he already owes over £5500 without even getting another car yet. Every time I try and talk to him about these increasing debts he mutters 'oh it'll get sorted' and doesn't really do anything else about it. He's very blase about putting stuff on his credit card with no great thought about how he'll eventually pay it off. I don't want to tell him what to do with his money (we have always had a joint account for all bills, mortgage etc with agreement that our personal monies leftover after this we do with as we like). However now we are married I suspect he's debts are hitting both of our credit ratings hard and our chances of ever getting another mortgage to get a bigger house so we can eventually have room for another child (we have one beautiful 10 week old DD at the moment) are getting slimmer and slimmer. Neither of us are big earners and £5500 will take a long time to pay off. So my question is do I get a bit tough on him about it or is this being unreasonable and should I let him sort his own finances?

OP What will the car sell for? Surely it has some value, so that will wipe off some of the remaining payments. Is there no chance of it selling for £2.6k, so that he can wipe the slate clean and start again?

Do not use your savings to bail him out! I think it's awful that you're careful with a view to making a better future for the two of you and he just spends whatever, whenever, with no way of paying it back.

I don't think it's being controlling to want a partner who is on the same page financially. Also, once there are children involved, I'd want to know my children had financial security. What will happen if you bail him out and then he pisses it all up the wall? Gets into debt again? You've been frugal for nothing then.

It's his attitude about money that worries me. If I pay off (some of) his debt I'm not totally convinced he would change his attitude to credit. I fear in 5 years time we'll be in the same situation. It's actually the reason I never wanted us to share all of our earnings in the first place, as I knew it would lead to arguments all the time about me having to subsidise his more indulgent expenses. I'm actually surprised how many of you completely pool your money together. Does it not lead to more arguments over money? We always had an arrangement that mortgage and bills we paid equally, our cars and mobile phone bills we financed ourselves, and that I would pay for most of groceries as he has to pay out more in fuel each month. Other than that our finances are essentially separate. Clearly we are unusual in this regard and I never realised.

If you have the capital pay off the debts NOW. Compound interest and the interest rate are working against you. The rate of return on savings accounts is derisory. You will be financially better off with no debt and reduced savings that with £x in the bank earning diddly squat in interest while paying £2X a year in interest.

Once you've done that and are clear, you make sure you take charge of the debt.

*you take charge of the finances.

I don't understand all this "why does he have debt when you don't" commentary.

I have debt from a postgraduate course I did a couple of years ago. My DH has savings. I don't think it is his responsibility to pay it off for me.

I'm not sure what I would do in your situation op. I'm careful with money too and my DH less so. It makes my eye twitch sometimes.

Could he sit down and work out a budget with you?

My DH and I do our finances in the same op way My mum strongly advised me against ever having fully joint finances. My dad finds this baffling and I just look at him with narrowed eyes (parents haven't been married to each other for a long time).

Debt if married is not joint, bailiffs cannot chase anyone whose name is not on the debt. I can see he needs the car. Why does he need the credit card, exactly??

I don't understand not having joint finances but I know lots of people do make it work. Joint has worked well for us for 25 years but after some initial training of DH we both have similar attitudes to money which must help.

For those who don't pool things, why not? Presumably you both have similar amount of disposable cash, it can't be possible to be married to someone who can't afford to go on holiday, if you can? As I understand it, if you split, the courts would pool everything as the debts/assets of the marriage, so what is the benefit of keeping it separate?

I would be very worried about paying off his debt with your own savings because if he doesn't change his attitude and his spending habits radically then you could just be enabling further spending on his part. He would be highly likely to just run up similar debt again. To be honest, I am rather surprised by the number of people recommending you do that.

I know of a couple of cases where one partner has paid of the debt of the other (in one case it was tens of thousands which had to be transferred onto the mortgage) believing that they were helping them to get over their problem and believing their promises that it would never happen again. Guess what!! It DID happen again, worse than ever and they now look likely to separate.

Don't enable his profligate spending. Keep him aware though of why it is a problem, and why he needs to "grow up" financially speaking. Everything always comes home to roost in the end.

Alias

My DH earns twice my salary. We don't pool our finances because I don't want to. That is unlikely to change as my salary increases.

Courts may pool assets or they may not. Depends on the individual circumstances. Unlikely if there are young children.

But not all divorces go to court. A great many are agreed before that stage.

Thank Alis. I do find this interesting. So if you don't pool your money does that mean you're living with a man who can afford more nights out than you can, better holidays and cars, spend more on presents or is just more financially secure than you are?

Alias

I will admit we pool for holidays.

I'm very good with money and he is rather less so, there's no discernible difference in what I can spend my money on and what he can spend his on, really.

We don't do equals financially and don't pool. Instead we both contribute equitable amounts based on our salaries and then what is left over is our own to spend.

He is more financially secure than me, by virtue of the fact he is older.

TheAlias: I earn more than DH (by a few hundred a month). I generally save most but sometimes go out with friends or similar and treat myself to something with my money. I treat DH to dinner or similar regularly and have paid for him to go on holiday with me sometimes if I knew he genuinely wouldn't be able to afford it otherwise, but I'm just more comfortable with my money being under my control.

That's what bothers me KitKat. I've been on both sides. Before Dc, I earned more than Dh but now I work p-t. I'm sure you're very generous but it doesn't sit well with me that you "treat" DH. It makes it seem like it's not an equal partnership. Like when the DHs of SAHMs get to choose where they go on holiday and if they go out for dinner, just by virtue of the fact they're paying.

Pre mat pay that is. At the moment he is earning more than me.

It's never done in a patronising way and DH has never been bothered by it. Unfortunately whilst he's a great husband and father money isn't his strong point, and I fear if we pooled our money he would regularly take more than he contributes and it would lead to disagreements. It's always been easier for us to keep some money separate.

I think you should each have your own money to do what you want with, but that money should be equal if you are a true partnership.

He shouldn't take more than he contributes because it should all go centrally (or be accounted for by an appropriate amount being transferred out of his account) and you each being left a free to do what you want with amount of money.

There is NO taking out of the general pool of money unless its for the set bills, and joint expenses that you've agreed. (Eg, you both agree you want a new tv, so the money for the tv comes out of joint savings. If he wants a new super whizz bang tv but you already have a pretty good tv and you don't agree with a new tv, then he buys it out of his own money if he wants it that much).

That's what people mean about putting it into one pot. It doesn't mean that you put it into one account and just withdraw whenever the heck you want!

KitKat
The credit card debt is both easy to deal with and easy to prevent recurring.

Have a look at this thread
www.mumsnet.com/Talk/legal_money_matters/1987219-SPREADSHEETS-for-Debt-Control-Budgeting-Mortgages-etc
and from it this spreadsheet
docs.google.com/spreadsheet/ccc?key=0AiZqlQ7-gn07dHRoTXA5Qnlld25UWkw1TEhZZk9IYVE&authkey=CMjc4JEB&authkey=CMjc4JEB#gid=0

Cancel the minimum payment direct debit.
Set up a standing order for whatever last month's payment was, rounded up to the nearest fiver
BINGO
repayment period drops from 18 years to two : with no more money leaving your bank than left it this month.

If he does not believe you / me
print out that spreadsheet and lay it the length of the hall ....

Keep your money separate!
You need to work out how to live with different attitudes to money, without just handing over yours!!

I did 7 years married with separate money. Marriage was shit, but money rarely a factor. He earned more (but not significantly so) but had expensive tastes and credit cards.

I'm now dating someone who earns a third what I do. I'd happily have a joint account with him, because he has my attitude to money.

For those who think the credit card here is mostly car bills, it's not. It is the garage stuff that went onto the card, but it is the £60 shirts that stopped it from being paid off. You have to look at the whole picture.

Paying off his debts won't change how he handles money and you could be in for a lot if stress to come if you don't address that.

I'm with you OP. While my DH and I have "joint" accounts, one is his, one is mine. We both like to have "our" money. It's worked for over 5 years and I honestly don't see it changing!

I don't think the credit card debt is really the problem here. It is and it isn't. It stresses you out, but it's more his attitude to it, and the knowledge he isn't good with money. Even if he got it sorted out eventually, somehow, it doesn't change the fact you have such very different opinions on spending/saving... to the detriment of your financial safety.

I think you need to have a chat to him about it. It makes you feel unsafe and insecure. He's supposed to be helping to support you and your new baby and yet he can barely support himself without getting into debt! That's a lot of stress you don't need.

Oh and no. I don't think you should use your savings to pay off his debt. Only if he was normally financially stable would that make sense. Otherwise you're just throwing good money after bad.

As people says it's lal about shared attitudes. We never argued over money in marriage. We were both very careful, saved a lot and had the same aims - nice house, school fees and both knew we'd always work full time even when we had little babies so no risks of joint accounts. If one os a huge spender and the other not then separate money makes sense. Do note:

1. You are not in England liable for each other's debts under the law
2. However on divorce does not matter whose name debts and liabilities are in in terms of sharing things so if he has £100k of debt and you have £100k of savings on divorce the family wealth is £50k which may well go £25k to each person. This does not apply at all if you are not married and just living together.

You pay for his meals out and holidays as he can't afford to?! He's got it made, hasn't he? Runs up debts which he expects you to clear, earns less and is subsidised by you. May I be the first person to mention the term ccoklodger?