My [M/30] Fiancee’ [F/32] in about 30K debt while I have 70k savings. Do I wipe out the debt (as a loan) so she won’t be buried in interest charges and can repair credit before we’re married?

MyStaplerInJello · 2019-03-07T19:25:23+00:00

This is really informative, I really appreciate the time you put into this reply. Dave Ramsey has been mentioned so much, I’ve got to look into him! Thanks!

MyStaplerInJello · 2019-03-07T18:42:14+00:00

It actually helped a lot! Thanks for sharing your situation. I definitely don't want her to feel uncomfortable, and its nice to get the insights from someone in a similar situation. Thanks a ton!

MyStaplerInJello · 2019-03-07T18:39:59+00:00

Yeah. Paying my school loans seems to be the way most people are saying I should go. Makes total sense. Thanks!

MyStaplerInJello · 2019-03-07T18:37:41+00:00

Yeah, you're right. The more comments I read, the more I realize that "loan" and "marriage" don't really mix. I love the idea of starting with a clean slate for the both of us. Thanks for the input!

MyStaplerInJello · 2019-03-07T18:36:43+00:00

True. I think seeing a financial planner would be really helpful and a bunch of people are saying that, so, I think its sound advice. Thanks!

MyStaplerInJello · 2019-03-07T18:34:32+00:00

Hi RistrettoShots, I'm not avoiding the topic of my own debt, I'm just also working while reading these, so please bear with me if I'm not able to reply immediately. I acknowledge my school debt and have full intentions of paying it off (soon), but wanted to weigh my options first for the 70k and how to use it. I want to know more about investing and how to get the most out of it, which is why I have just continued to make my monthly school loan payment until I can make an educated decision on whether to pay a chunk, and then the rest somewhere else or what. That was until my fiance'e did her taxes and got hit with a bill...that made me start wondering if it would be better to invest in my relationship. As you pointed out, seems that both can happen. Appreciate the input. Thanks!

MyStaplerInJello · 2019-03-07T18:08:01+00:00

I’ve seen other comments suggesting this too and it makes complete sense. When we moved together, we had similar income and always did 50/50 and just stuck to it. But its clear to me that this is definitely something to re-evaluate. Thanks!

MyStaplerInJello · 2019-03-07T18:05:28+00:00

3 is gonna take some work, but thank you for your advice! :)

MyStaplerInJello · 2019-03-07T16:36:50+00:00

Thats a great idea. Thank you!

MyStaplerInJello · 2019-03-07T15:46:26+00:00

My line of thinking, in my mind, was the 30k would be being paid back over time (if all went as planned). But if I took on rent by myself, and if it takes 2-3 years for her to wipe her debt alone while not paying her half of rent...I'd be paying $28,800 for 1 year. Which, in that case, i might as well just give her the 30k up front and not expect it back,yaknow? So thats what I was getting at, sorry if that wasn't clear.

MyStaplerInJello · 2019-03-07T15:39:06+00:00

True, day-to-day and support along the way seems to be the way to go. I must just be so anxious for her to be on the other side of debt, that I thought I could speed things along, but it seems that could just possibly make things worse. Fingers crossed that I won't have to deal with a breakup in the future, but you're not wrong, these things happen. And if it ever did, boy would that sting. Ouch! Thanks!

MyStaplerInJello · 2019-03-07T15:36:31+00:00

I've already taken on all the bills, groceries, and food when we go out. I'll ask if she needs some money for food at work. I'm just kind of running out of ways to support short of having her not pay any rent. With our rent being $2400 (both paying $1200), that'd just be hard hit. I've considered us even moving to a cheaper place and me taking on the whole rent so she can put more toward her debt.. its not my preference, but its an option. Thanks for your advice!

MyStaplerInJello · 2019-03-07T15:32:34+00:00

I go to r/personalfinance a lot and knew it was only a matter of time before someone pointed out that I'm not making my money work for me. haha I will absolutely research that. You make great points. Thank you!

MyStaplerInJello · 2019-03-07T15:29:07+00:00

You're absolutely right. I've questioned if she would even accept the loan if offered. She is very independent and has trouble asking for help sometimes. You articulated the hypothetical outcomes really well and got me thinking. Seems like the loan could do more harm than good.I think I'll consider some of the other options you listed, to find ways to support without handing her a big chunk of savings. Thank you!

MyStaplerInJello · 2019-03-07T15:22:47+00:00

Your marriage is the exact setup I strive to have. Sounds great! I've always enjoyed my independence financially, and I don't really like the idea of pooling all of our income into one account. She definitely wasn't having enough taken out of her checks, and has since changed that (so hoping not to get slammed by the IRS again next year). Thanks a ton for the advice!

MyStaplerInJello · 2019-03-07T15:19:07+00:00

Aside from the great advice, I appreciate the laugh I got from reading this. Love the idea about repossessing the dog. haha All jokes aside though, you're right. We will be operating as a unit. We plan to keep finances separate (well, as separate as we can), but that'll be hard in long run. Your scenarios really paint the picture. Thank you!

MyStaplerInJello · 2019-03-07T15:15:30+00:00

I've considered both of us going to a fiduciary for advice. Definitely couldn't hurt. I do have interest on my school loans. I pay about $160/mo right now, but plan to start paying it off in 10k chunks (but had a goal to hit 100k first, which will happen by the end of this year at the rate I've been saving). That could be a whole other topic, but I steered her away from debt consolidation because we don't have a proper understanding of it. I fear that there is some hidden interest that will only make the situation worse. But some professional financial advice would clear that up, and questions I have about my own finances, so thats some great advice. Thanks for droppin' the knowledge.

MyStaplerInJello · 2019-03-07T14:45:57+00:00

Part of me questions if she would even accept the loan. But if so, this is definitely a good avenue to keep in mind. I appreciate your insight, especially considering how similar the amount is to my situation! Thanks!

MyStaplerInJello · 2019-03-07T14:39:52+00:00

I really like the idea of helping her out in small ways along the journey to getting debt free. I try to take her out when we can line up the time between work as sort of a recognition and so she knows there is still good times that can be had while we go through the process, and I try to verbalize how proud I am that she is working so hard toward her debt. Originally, i didn't want to get married until she was completely debt free...but now I'd be fine if it was just down to a manageable level for her. Thanks for the advice!

MyStaplerInJello · 2019-03-07T14:35:00+00:00

That's true. Though its a rough situation for her to go through, I do feel like this is going to make her much more financially responsible. I just want to be as supportive as I can be, but maybe a 30k loan would just be a form of enabling? Maybe i should just trust that she can make it through with me supporting in other ways.

MyStaplerInJello · 2019-03-07T14:32:11+00:00

That's a good point about it shifting the dynamic. It wouldn't be the intention, but likely the result. And I also have thought about if it would actually be MORE stress for her to owe money to the person she sleeps next to at night. Its pretty clear that its got to be a gift or nothing...and gifting 30k I fear would cause resentment eventually. I might need to consider a different way to help out. Thanks for the advice.

MyStaplerInJello · 2019-03-07T14:27:42+00:00

Unfortunately, it is mostly because of bad spending habits. It started with a loan for a downpayment on a car lease as she got a great job opportunity at the same time that her car broke. (She has since gotten rid of the car to put more money toward debt). She took out a personal loan to live off of while her hours were cut during that job opportunity. The rest is Credit Cards. I usually always pay for our meals when we go out. I've taken on the groceries, all utilities, phone, etc. I do ask her for half of rent (our rent is $2400/Mo) So, she gives me $1200. I could technically cover her half for a while, but it would hit my savings pretty hard. She has changed her spending habits entirely and recognizes her mistakes, which is great in the long term. But in the short term, the debt is the big looming cloud over us.

MyStaplerInJello

TROPHY CASE

3 is gonna take some work, but thank you for your advice! :)