Don’t put off marriage until you’re debt-free, experts say

Despite all the cultural norms Gen Z has blown up, they agree that marriage remains the most important milestone in life. At least that is evident from a study by the wedding planning platform The Knotin which Gen Zers were recently asked if they value things like getting married, buying homes, and having children. (The Knot obviously has an interest in ensuring that people always want to get married, so we’re taking that finding with a grain of salt.) The majority of respondents placed marriage at the top of the list, even though this generation tends to live later on average. more likely to get married than others, such as baby boomers and generation X.

But zillennials also tend to face more economic barriers than those older demographic groups did at their age, including some of the highest rates of consumer debt ever in American history. And the burden of debt and loans is changing the way younger generations think about wedding planning, and even getting married. Some couples who know they eventually want to get married choose to delay their engagement until they are completely out of debt — a task that can take decades for the most burdened individuals to achieve.

A Bank interest survey 2022 found that 18 percent of Generation Z and 15 percent of Millennials said they were delaying marriage for financial reasons, compared to 6 percent of Generation X and 2 percent of Baby Boomers. CreditKarma reported in 2023 that more than half of millennials do not want to get married until their ‘finances are in order’, and a Lumina Foundation and Gallup A report from the same year found that 13 percent of student loan borrowers postponed marriage because of their debt.

But The Knot also found that about 90 percent of Gen Z couples prioritize discussions about their finances before the wedding, which according to wedding budget expert Lauren Kay, reflects a desire “to really be on the same page ​​with those goals and milestones” before committing to a life together. “It’s no longer taboo, people are talking about (money) before,” she tells PS. This means that more and more couples today are having more honest discussions about their debts and what they would like to bring into a marriage.

Experts from this article

Lauren Kay is a wedding budget expert and editor-in-chief at The Knot And The bump.
Jack Howard is head of money wellness at Ally Bank and the face of the money psychology program Money roots.
Aja EvansLMHC, is a board-certified therapist, speaker and writer specializing in financial therapy. She is also the president-elect on the board of the Financial Therapy Association and author of “Feel good Finance.”

Those conversations aren’t easy, says Jack Howard, who teaches a money psychology course for Ally Bank called “Money Roots.” “If you’re worried about money and don’t have the resources to change, you shut down,” she says. “You may have a lot of debt, but if you don’t have a plan to tackle it, just quit and give up. You say, I’m not going to get married, I’m not going to have children, I’m not going to buy a house.” house. Too overwhelming.”

But there are ways to manage your finances without sacrificing important life goals, she says. ‘I am not in favor of putting your life on hold until everything is paid for. Should You Avoid Your Debt? No. But let’s talk about it and make a plan to pay it off.’

Do I take over my partner’s debts when we get married?

One of the main concerns about romantic partnerships between one or more people with significant debt is that their debt will pass to their spouse once they are married, and vice versa. But that is not always the case. Debt acquired before marriage is not transferred to a spouse, according to the report American news and world report. Debts accrued during a marriage are a different story: your spouse may be liable for those debts if you live in community of property. (This also applies to Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin. In addition, Alaska, Florida, Kentucky, South Dakota and Tennessee have an optional community property system.) However, debts on joint accounts , is your responsibility regardless of your state.

And while your spouse’s debts probably won’t affect your credit scoreBanks and financial institutions will look at both of your credit scores when assessing your eligibility for loans if you apply together.

Financial therapist Aja Evans is a big fan of the prenuptial agreement as a means of clearly articulating financial expectations in a marriage. Are you worried about taking care of your partner’s debts once you’re married? Prenups exist for exactly that reason.

“Similar to budgetsprenuptial agreements get a bad reputation,” she tells PS. In her practice, she often helps partners navigate the prenuptial agreement process and the emotions it can bring. The prenup’s association with divorce makes those who seek it look like villains, she says, but they really don’t have to be a negative thing, or even a big deal. “You could just say, ‘Hey, you’re leaving the marriage with whatever you brought with you, this is your financial responsibility, this is your financial responsibility.’ a marital asset, and how are we going to divide that if something happens to our relationship,” she says.

Aside from concerns about the financial implications of debt during your post-wedding life, some people are averse to getting married with outstanding debt simply because of the wedding costs. There is a feeling that they cannot afford to pay for a wedding, or that they should spend the money they spend on the party on pay off their debts instead.

The Knot recently launched a new tool for budget advisors designed to support partners planning a wedding on a budget, Kay tells PS. Not only does it put together vendor recommendations that are all within your means, but it also helps you set a budget for the wedding in the first place, based on the average wedding prices of wherever you’re hoping to get married. That way, you can make sure your wedding day doesn’t derail your big financial goals.

How can I talk to my partner about debt?

Howard says it’s important to understand the totality of your partner’s debts, which can impact things like your ability to save for the down payment on a house. Before tying the knot, you should understand your partner’s credit score and whether he or she pays his bills on time.

Both Howard and Evans emphasize that everyone has a different relationship with money, and it’s important to examine your own before making these big life decisions with someone else. Concerns about your partner’s debts can reflect your own values ​​just as much as their debts reflect your partner’s. “These problems are so much bigger than the debt,” Howard says.

To make lasting plans for your future, whether it’s marriage or something else, you need to talk to your partner about your money values, goals, and biases, and find a way to do this without judgment. Evans applauds couples who talk openly about their salaries, debts, debt-to-income ratios and lifestyle choices without perpetuating shame or guilt.

“Instead of it being an attack of, ‘You have to pay your student loans or I won’t marry you,’ it can also be, ‘I don’t feel stable when we have this debt,'” she explains. If the debt makes you worry about taking out a mortgage, for example, be honest about this with your partner. If your discomfort with debt stems from something else, acknowledge that as well.

“It’s very easy to immediately get defensive,” she says. “It’s a very uncomfortable conversation, but very necessary if you’re thinking about spending the rest of your life with them.”

Conventional financial advice would lead us to think that money is not emotional. But the truth couldn’t be more different, says Evans: ‘Fear, instability, shame and guilt are the most prominent in these conversations. Talking about money is very vulnerable for people, but that means you let someone in and don’t leave. only through it. They should be there in all the beauty the world has to offer, but also in the hardships. There should be a sense of, ‘We’re in this together, let’s do this together.’

If you’re lucky enough to have that solid foundation with a partner, and if marriage feels right, the experts all say it’s better to take the plunge than put it off until your financial position has changed. “If you wait for life to be perfect,” Howard says, “you’ll wait all your life.”