A California woman asks Sues Orman if she will take charge of her husband’s credit card debt
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On an episode of Suze Orman’s Women & Money Podcast, California’s Jane wrote to the show and chose Orman’s brain for her husband’s credit card debt.
Her question to a leading personal finance expert: “If anything happened to my husband, am I in charge of his credit card debt?”
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Jane added that her name is not associated with anything related to her husband’s credit card. However, Orman and her co-host KT Travis quickly pointed out that this was irrelevant anyway.
“You will most likely be liable for your husband’s credit card debt that arises during the marriage,” Orman explained. This is what this means for Jane.
Essentially, your spouse’s debt is also your debt.
In the property state of the community, all assets and liabilities (with few exceptions) made during the marriage are considered to be held equally by both spouses. In the case of divorce, everything that accumulates during the marriage is divided into 50/50.
It doesn’t matter who is on the assets or liabilities, as the legal association binds both individuals. Therefore, all financial assets that are involved in a marriage are usually considered community assets.
If Jane’s husband is in debt in front After a marriage or legal separation (such as divorce), Jane, as Ormand pointed out, “Because they are considered. His Unless you specifically agree to assume such debts, the debts and you will not be liable for them. ”
Most US states do not have community property laws, but these laws currently apply to nine states, including Arizona, California and Texas. That being said, if you sign a pre-nuptial agreement before marriage, you can opt out.
Whether you want to merge or split your spouse with your finances, you can talk to your financial advisor and guide you to take the right steps. This is especially important if you own property together, or if either of you have an extensive portfolio.
If you’re looking for financial advice, advisor.com Connect with a carefully selected trustee financial advisor near you. All you have to do is answer some simple questions about your finances. And Adivsor.com will match you with a short list of certified experts to choose from.
In the unfortunate event where you stay in your spouse’s debt, there are a few things you can do to help your financial situation.
Start by reviewing your finances and create a spreadsheet containing estimates of other outstanding personal liabilities and monthly expenses. Proactively or budgeting debt consolidation is a possible option.
For example, credit card interest rates tend to be very high, but by consolidating debts on personal loans, you may be able to make your interest rates much lower. This will help you manage your payments more efficiently and prevent your debt from escalating even further.
Finally, make sure you and your spouse are in good financial position before you and your spouse say, “I will.”
Another way to consolidate your debt is to leverage the capital of your home through the Home Equity Credit Line (HELOC).
HELOC is a safe credit line that uses your home as collateral. Depending on the value of your home and the remaining balance of your mortgage, you may be able to borrow funds at a lower interest rate from the lender as a form of revolving credit.
Instead of juggling your invoices with different dates and interest rates, you can consolidate them into one easy-to-manage payment. result? Reducing stress, generally reduced fees, and potential for significant savings over time.
Jane can also offset some of her debts by avoiding savings.
Regardless of the marriage status, saving money in an emergency or in this case is important for those who have been in debt from their spouse.
One way to increase your savings in large quantities is to use a high profit savings account.
Easily compare multiple online banks offering high yield savings accounts of 4% or more with interest in an annual period in minutes. Many options currently offer a monthly fee of $0 and do not require a minimum balance to earn a high APY.
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This article is for information only and should not be construed as advice. It is provided without warranty of any kind.
