Though not the most romantic aspect of marriage, credit scores and financial history are very important topics to discuss before your big day. In the first years of marriage, there will be loans, credit cards and an entire list of other expenses that usually come with a new beginning. If you or your spouse has a less than stellar credit score, it’s much better to know sooner rather than later.
Despite popular belief, there is no such thing as a joint credit score. When you get married, you still maintain your separate credit scores, and are only affected when you open up a joint account or take out a loan together. When opening a joint account, the information will show up on both of your credit reports, so you still have your own score no matter what.
Til debt do us part?
Don’t let financial stresses get in the way of your happiness. In the event that you or your spouse has a particularly low credit score, here are some important measures to ensure you guys don’t start off on the wrong foot.
Check your credit score: Mistakes on credit reports are not uncommon, so be sure to take a look and report any misinformation. Each of the three major credit reporting agencies, Equifax, Experian, and TransUnion, are required to give you a free credit report each year. You should make it a habit to check your credit about every four months to avoid mistakes and to know where you stand.
Don’t stack up unnecessary inquiries: Having too many inquiries on your credit report doesn’t look great to lenders. If you have too many credit checks in a short period of time, it will hurt your score since it seems like you’re acquiring too much debt. Inquiries can stay on your report for 2 years, so avoid frequent credit checks. If you get denied for a loan for having a poor credit score, lenders are required to disclose your score to you.
Keep some separate accounts: In the beginning, keep some of your separate accounts so you can don’t negatively affect each other’s scores. For example, have separate savings accounts, but start a joint checking account for household bills.
Build your spouse’s credit score: On the other hand, you can help improve your spouse’s credit score when you’re ready. If one person’s score is significantly higher, consider taking out a smaller joint loan or applying for a low APR card together. It’s also worth looking into balance transfer credit cards so you can pay down any debts you or your spouse may have, and avoid high interest rates in the short term.
Pay bills on time and stay out of debt: This may seem obvious, but it’s worth saying again. Come up with a schedule or system for paying your bills in a timely manner. You don’t want to put yourselves in a worse position by accumulating too much debt. If you keep your balances low, you could also improve your credit score since the utilization ratio, or ratio of your balances to your open credit lines, counts for 30% of your total FICO score.
Talk it out: Before you make any big decisions, it’s important to put everything out on the table so you and your spouse can make informed decisions together. It will save you a lot of hassle and stress if you are fully aware of your significant other’s financial history. In marriage, you choose to share your lives, including your hopes, dreams, and your debts.
Make a smooth transition out of the honeymoon by ensuring financial stability before you walk down the aisle. Once you know where you stand, you’ll be able to start a life together, worry free and happily ever after.
Angie Picardo is a staff writer for NerdWallet, a credit card website designed to help consumers find the right card for their credit score.