How do you convince your husband we should get out of debt; i.e., pay off the credit cards?
I am the sole breadwinner and my husband stays home to care for our children. We have accumulated quite a bit of savings thanks to the COVID stimulus payments and our tax refund. I would like to use the savings to pay off our $20,000 credit card debt for peace of mind and have a clean slate. He wants to keep some/all of the savings for potential emergency house projects. I think we can come to a compromise, but I welcome any tips on how to get on the same page as a couple. We have different values/ attitudes about carrying credit card debt. I am so stressed by the debt that I got a second job on the weekends (just three hours) to help earn more money to pay down the debt. Thank you in advance.
It’s pretty simple. When you have debt, everything you purchase costs extra since you’re still paying off past expenses. I understand you need to keep the peace but as the sole breadwinner, I’d think you’d have more say in the matter. Make him understand how stressful it makes you feel. Start listening to Dave Ramsey together. He’s all about “debt is dumb.” I’m right there with him and totally on your side.
Here’s an article I just happened to find on the subject of debt and marriage:
Also, once out of debt, agree to stay out of debt. Don’t purchase anything until you’ve saved up for it.
Determined to Get Out of Debt said:
I fantasize about the day we will be debt free. It will be the happiest day of my life! I’m just so stressed out with the amount of debt we are carrying.
This is what you need to convey to your husband. He needs to help you and support you in this endeavor.
When I had debt, I quit using credit cards until I was out of debt. I used my debit card instead. In order to do this, you have to fully utilize YNAB and categorize all income and check the categories before spending to make sure you have enough. Or can pull from another category.
It's a dangerous game to take out loans to pay off you credit cards while continuing to use them. If you haven't learned to live within your means, you can easily end up with the loan plus the credit cards back at what they were before you got the loan.
There are no easy solutions to the situation - but all solutions will require honest and clear communication between the two of you.
Here's the other piece of the puzzle that a lot of people don't realize - how you think about money and debt is just as important as how much you do or don't have.
This isn't discussed a lot, but it's a key to your success with money. And note: "success" with money means something different to every person.
So here's some things to think through for you and your husband...
Your attitude about your debt will have a lot to do with whether or not you are able to pay it down and keep it paid off. If you are panicked about it constantly, and constantly consumed by the fact that you have it, your focus is only on the debt, which can keep you trapped in a viscous cycle.
How much is your debt costing you? If you have some very low interest loans, or 0% promotions, then that's a different issue than if the debt is costing you several hundred dollars per month.
You didn't get into debt overnight, and you won't get out overnight, especially if the factors that caused the debt aren't addressed.
To spend or not spend money is actually much more emotional and subconscious than we give it credit for. Figuring out how to align your money goals and your husbands money goals will be the key to your success together.
Having debt isn't actually inherently bad. It doesn't make you a bad person (geez, if it did then the majority of the US population would be terribly bad people). It makes you a person who made choices in the past that led to debt. It's neutral. It just is.
When it costs you a lot of money to carry the debt, then that makes it that much harder to get rid of the debt. Lowering your debt level gives you freedom to take advantage of other things that aren't available to you when you have to pay towards a lot of debt each month (and have a lower credit score as a result).
Figuring out a strategy to reduce what it's costing you to have the debt is a good way maximize your ability to get rid of the debt. 0% interest promotions and low interest personal loans are good options.
Utilizing credit cards is not bad either - IF you can use them to your advantage. You've got to be able to parent yourself and be responsible with managing them. They can help you if they have rewards programs that will give you cash back, which helps lower your debt. I prefer to use them because it also protects my cash a little better from the risk of the card info getting stolen. They might be able to run charges up on my credit card, but it won't take cash out of my account.
Beating the system at it's own game is how you get out of debt. My BF and I have struggled with debt since we started our relationship. Between the two of us we began with about 10k in debt, and it yoyo'ed a LOT in the years that followed before we were able to increase income and figure out a way to get a handle on it. He's down to about 3k, and I have finally paid off my personal debt (I have a small business carrying a large amount of debt right now, but that is what it is), outside of our car loans and the mortgage.
The FIRST priority for me was to make sure we were covering all current expenses. Paying off debt is useless if you continue to spend more than you can pay off. That actually caused me MORE anxiety than seeing the debt amount go down. So ensuring we were being effective in YNAB and not spending more than we had was top priority. Then if there was anything left (minimum payments obviously are a priority, but anything after that was gravy) we could work on debt. But we also simultaneously worked towards bigger projects that we knew would be coming. If you can get the debt into 0% or low interest promotions then it's not costing you anything to have it sit there, which means it's much more affordable. (A very financially savvy person once told me to not pay more than I absolutely needed to on any debt that was not costing me anything.... it makes perfect sense if that means that you don't add any other debt by only paying the minimum when it's a "free" loan)
Anyway, this has gotten ramble-y. The two of you are going to have to find a middle ground. Yes, paying off debt is important. AND so it not incurring any new debt. Finding the balance between the two is the trick.