Money Matches #4: Protecting Yourself

Sometimes people end up in relationships where they are very badly matched when it comes to the money. You’re a saver. Your partner is a spender. You think about the future. Your partner lives for today. You’re conservative. Your partner likes to take risks.

If you’re counting on your buddy to do the things you need to keep your financial boat afloat and (s)he doesn’t, you may have to accept that you’re in this ship alone. If you love your mate, that may mean accepting them for who they are and getting on with the business of life. And if you have children, it may mean putting up a protective wall around yourself and your kids to make sure you are safe.

I’ve received hundreds of letters from people who are unhappy with their mates’ behaviour when it comes to the money. They feel at risk. They feel out of control. And they are stressed, sad, worried, depressed, and don’t know what to do next.

If you are living with a partner who is irresponsible with money, you have three choices:

  1. you can stay, living life on the rollercoaster and hoping for the best,
  2. you can leave, up-rooting everyone and bearing the cost of the breakup both financially and emotionally – so you better be dead sure this is the right step, or
  3. you can accept that you can’t change your mate, stop your whining, and create a protective wall that isolates your partner’s aberrant behaviour and keeps your family safe.

Whether your partner gambles, drinks, does drugs, uses credit like it’s never going to run out, likes to change his/her vehicle every six months, or can’t walk past a store without dropping a bundle, if you’ve begged, pleaded, cried, threatened, and even tried to walk away, maybe it’s time to accept that this is who your partner is. If you can’t live with it, you know what you must do. If you can’t live without it, but don’t want his or her storms to sink your ship, take these steps:

  1. Make sure you are not on the hook for any of his borrowing. That means no joint credit (which I disagree with anyway). No co-signing. No sharing of credit cards or bank accounts (keep your cards and your PINs to yourself) especially where overdraft protection may leave you on the hook.
  2. If you own a home together, accept that your home may not be around forever. Any joint assets will be at risk since if your partner ends up in bankruptcy, those assets will be part of the proceedings. The only way to avoid this is if your partner’s name is not on title. If it is, paying down your mortgage may be an exercise in frustration since whatever assets you build up may be affected by your partner’s wanton spending and rampant debt.
  3. Keep all the important “must-pay” bills in your name. Put all extraneous bills – cable, telephone, sports fees, etc. – in your partner’s name. If your buddy blows at getting the bills paid on time, you don’t want it to affect the really important things or your credit history.
  4. Make sure you have a big fat emergency fund. While the general rule of thumb is six months’ worth of essential expenses, if you’re married to a financial moron, you’ll need to have nine months’ to a year’s worth of expenses socked away. Your partner is an emergency waiting to happen. Be prepared.
  5. Save/invest separately. Ha! Who are we kidding? Your partner isn’t saving. Just make sure she doesn’t know where the money is or has any access to it. It doesn’t exist as far as she’s concerned.
  6. Come up with a plan for the expenses. He has to give you a specific amount every week to meet the family’s needs. If he doesn’t then you’re stuck with a free-loader and should reconsider your options. If he does, that money goes into an account that you use to make sure the essential bills are paid. The other stuff he can pay from his own account. Yup, you’ve got separate accounts!
  7. Keep your hand out of your pocket. This is the toughest thing you’ll have to do. You cannot save your partner. You should not attempt to rescue her when the tears start. It’s part of the condition. You have to grit your teeth and NOT bite the hook. If you fail at this part, you’ll fail altogether!

This isn’t about punishing your partner it’s about protecting yourself. And if you have children, they need your protection. Just because one member of your team can’t see beyond his or her own nose doesn’t mean the whole family should suffer. If you’ve got a partner who just doesn’t get it, you’ve got a rough road to walk.

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