Women In The Black

Financial Red Flags In Your Relationship

financial red flags

By Tamia Gallego

A close friend of mine recently got engaged to a man she has been with for six years. They are currently planning the wedding, looking at a venue and a time for the wedding.

My friend, Pippa* is 31 years old and her fiancé is ten years older. He is a wonderful person, affectionate, fun to be around with, a great cook, intelligent and a talented musician.

Pippa has been working hard to be financially independent and is having doubts about the relationship, and not for the first time. Pippa has had doubts from the beginning and the doubts have been there since.

The doubts centre on the difference in financial stability and work ethic between her and her fiancé. Her fiancé makes about $45,000 a year, which is enough for him to pay for the basics such as food. Pippa is a buyer for a fashion house who is making a decent living.

Pippa was given an inner city apartment from her parents where she and her fiancé live mortgage-free. Her concern is her fiancé’s lack of work ethic. Whilst she is proactive, he is not.

When they moved into the apartment, Pippa and her fiancé agreed that they would act as though they had a mortgage and would save a certain amount each month. The amount she is expecting them to set aside is about $15,000 each year, which isn’t much to her, but her fiancé isn’t attempting to keep to the agreement. He keeps promising he will try harder but he hasn’t made any effort.

In addition, her fiancé hasn’t lodged his tax return in three years. She knows all too well, that sooner or later the taxman would catch up to him.

Pippa has been with her fiancé for a long time, and despite their issues they are in love. She sees many of her friends who are in troubled relationships, or still single and looking for love. She is afraid she isn’t going to find another man with whom she will have a connection. She is afraid she will regret her decision if she leaves.

It is general knowledge that financial worries are the leading cause of strains in a relationship, and even divorce. Experts advise that there are certain red flags that you should be aware of when entering a relationship.

According to Daily Finance, the tell tale signs of your partner include the following:

Has A “Money-Is-No-Object” Approach

Splurging on flowers or dinner once in a while is nice (and often typical in the early stages of a relationship), but you want to watch out for a guy or girl who never looks at the receipt before handing over his or her credit card.

“A 30 year-old university graduate might have what seems like a good job, but do the expenses match the income?,” asks Linda Kern, a divorce lawyer who says deep-seated financial issues are one reason couples wind up in her office. “A salary nearing $100,000 may seem like a lot, but once the person makes a student loan payment, rent, car payment and insurance, there’s not a lot left over for extravagance,” she points out.

Appears Wealthy Without The Job To Back It Up

There are a few people who’ve been left a fortune by a long-lost uncle. However, if your significant other has a part-time job, or no job at all, yet somehow they drive a flashy car, purchase big-ticket items on a whim, or buys rounds for everybody in the bar, odds are they are racking up a boatload of debt.

Overdraws Their Account Or Has Cards Denied

Every so often, there could be a computer glitch that leads to a credit card being rejected. However, if this happens regularly, you may have a problem on your hands. Someone who truly pays their bills and doesn’t carry high balances will be truly shocked and insist the merchant try it again, whereas someone who knows it’s maxed out will quickly offer another card.

Receives Collection Calls Or Letters From Creditors

If debt collectors are hounding your partner, it’s probably for a good reason. Don’t be fooled if they dismiss it by saying they got the bill in a day late, or forgot a single payment. By the time an account goes to collections, the creditor has already made numerous efforts to settle the bill.

Is Derailed By Unexpected Expenses

In the same article in Daily Finance, it talked about when a cash-strapped marketing professional needed to replace her car early on in her courtship with her now-husband. He wondered why she couldn’t just pay the $5,000 cash for the used car she picked out, and why her parents needed to co-sign the loan.

In hindsight, one of them probably should have broached the topic. Her husband had no idea how big her debts were or how poor her credit was until shortly before their wedding. “When I turned 18, I started getting store credit cards and I was unable to work in university for about five months, and those bills started to pile up”. She estimated that she had several thousand dollars’ worth of credit card debt when she began dating her husband.

Does Little Or No Financial Planning

You don’t have to whip out a spreadsheet while over the tiramisu on your first date, but even early into the relationship, you should pay attention to the language the object of your affection uses when he or she talks about their financial goals or dreams for the future. When they talk about future plans to accomplish something, make a big purchase or plan a big event, do they also mention any concrete strategies to earn more money, spend differently or save to accomplish these things or is it just a wish list?

Has An Unstable Employment History

The current employment market out there is rough, but if your loved one jumps from job to job like a drifter passing through town, it might be a warning sign. They may say it’s always someone else’s problem or fault that leads to their departure. Be wary. If a person is constantly losing jobs and changing jobs, it can be an indicator of not following through, making poor decisions or generally irresponsible behavior which may lead to poor money management.

Again as previously mentioned, if you really love your partner and see yourself with them for the long haul, you can approach it together and possibly acquire the services of a career coach to give as sense of direction and drive to your partner to a career they will enjoy and even thrive at.

Admits They’re In Deep

Sometimes people with tremendous debts will give you a clue in a casual way to see how you respond. If your partner says “No bank would lend me a dime” or “Visa is chasing me”, may be making off-hand comments to gauge your reaction.

It is up to you how to broach this subject, but it is definitely something that should be discussed by people who plan to be with each other for a long time in a committed relationship.

* Name has been changed to protect privacy.

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