Talking to your partner about consolidating debt

Talking openly about money could bring you and your partner closer, and it might even make tough decisions easier to handle. Starting the conversation about debt consolidation is a powerful step toward creating a plan you both feel good about. 

Money chats can strengthen trust and give you a clearer path forward as a team. If you want to start a conversation with your partner about debt, we've got you.

Taken slowly and with a focus on shared goals, money discussions could reduce stress and put you both on the same page. 

Why should I have the money talk with my partner?

The main reason to talk about money with your partner is to improve both your financial situation and your relationship. As your lives become more connected, your personal finances could have a greater impact on one another. 

Discussing money could help build trust and make it easier to reach financial goals. That's particularly true if you're grappling with debt. Talking money with your partner may also help you avoid surprises further down the line. If you and your partner are considering big life moves, you’ll both want to have a clear picture of your finances with everything out in the open. 

Talking to your partner about consolidating debt could likely be a serious conversation. If you’re exploring debt consolidation, you’re already making progress. Talking openly about it is another strong step forward on your journey. 

What is the money talk really about?

Everybody has a different relationship with money. Money talk is about listening and understanding one another's needs. Having debt can happen to any of us—it’s nothing to be ashamed of. 

Discussing debt consolidation with a spouse is about getting on the same page. It means you can be clear about everything you both owe and decide what steps to take together. Everyone’s money conversation is a bit different, but knowing these details can point you in the right direction:

• The stage of your relationship 

• Your joint financial goals 

• What you can both afford 

If you decide to tackle the debt together, this conversation could help you decide whether combining payments is a good option. If you take out a loan together, missed payments could impact both your credit scores. 

What are your options to consolidate debt?

Consolidating debt means taking out one loan and using it to pay off multiple debts. Debt consolidation for couples can work in a few different ways, but the main idea is to make debt easier to manage. A debt consolidation loan could give you just one monthly payment to worry about, and you may be able to lower your interest rate. 

Debt consolidation loan 

A debt consolidation loan is usually a fixed-rate personal loan that you can use to cover several debts, such as credit cards, medical debt, and other loans. As a married couple, you may be able to apply for a joint debt consolidation loan. 

Your loan terms and interest rate can be impacted by your credit score. If one person has a higher score, applying jointly may mean you qualify for a lower rate. 

Home equity line of credit (HELOC) or home equity loan

If you own a home, you might consider borrowing money against the equity you have in your home. Your home equity is the value of your home over the amount you owe on your mortgage. Typically, home equity loan rates are lower than other forms of borrowing because your home is collateral, meaning it backs the loan, which reduces the risk for the lender. 

Other strategies to consider

Debt consolidation isn't the only way to handle your debt. When you talk to your partner, explore all the options so you can both feel informed. Some alternatives could be:

• Pay down the debt yourself. You and your partner may decide you can tackle the debts together. One popular strategy is the snowball method, where you pay down the smallest balance first for a motivating win. Then you move on to the next smallest debt, and so on. With the debt avalanche method, you start with the debt that has the highest interest rate and work your way down. In both methods, you make the minimum payment on each debt, then put any extra available cash toward the debt you’re focusing on.

• Debt resolution. Debt resolution could be a way to handle overwhelming debt. Resolving debt involves negotiating with creditors to settle your debt for less than you owe. You can try to settle debt on your own, or work with an experienced debt expert to negotiate and manage the process on your behalf. 

• Debt management plan (DMP). If you qualify, a debt management plan could simplify multiple unsecured debts into a single monthly payment without a new loan. Instead, you would work out a payment plan with a credit counseling agency. The counselor manages payments and can negotiate with creditors on your behalf. Creditors may agree to waive fees or charge a lower interest rate. 

• Balance transfer credit card. A balance transfer credit card could help you consolidate debt. It works best if you can qualify for a card with an introductory offer for 0% interest on balance transfers. There's a limit on how much you can transfer, and you’ll pay a fee, usually 3% to 5% of the amount you transfer. When the intro offer ends, the remaining balance will start accruing interest at the standard interest rate. 

How do I talk to my partner about debt?

Plan a time when you'll be able to speak without interruption. Be prepared to talk about what you owe and what options you have. Be honest. If the debt is yours and this is the first time you've discussed it, your partner will probably have questions. They may also need time to think about what you've said.

There's no such thing as the absolute perfect moment for these conversations. Just try to set aside some quiet, private time. If you have children, have the conversation after they go to bed or ask a friend or relative to watch them for a few hours. 

Language is important, too. Use caring, supportive language and avoid blaming phrases such as “You always” or “You never.” You might practice or write down what you want to say in advance. Remember the goals of this conversation: 

• To share important financial information

• To discuss strategies and options

• To strengthen your bond

• To work together to reach financial goals

When your partner is ready, the next step is to work together to find shared solutions. That might mean lifestyle changes to reduce spending. This could be easier to achieve if you can approach it as a team. You may need more than one conversation to set shared goals and make a plan on how to handle your debt. 

What if you and your partner don’t agree on money issues?

Lots of partners disagree on money issues, especially at first. Look for common ground. Perhaps you’d both like to feel more financially secure or buy a house someday. Your conversations could be more constructive if you feel like you're on the same team. 

If you find money conversations often become heated and you're going over the same ground, consider professional help. A financial professional or a couples therapist may be able to help the two of you build a plan together. 

What’s next?

If you're ready to start talking to your partner about consolidating debt, begin by setting a date. Broaching the subject is already a big step. 

After that, you can review your spending, income, and debts together. Many couples try to make the money conversation more pleasant by having it over coffee or a snack. It could also be a good idea to talk about some positive goals you both have, like planning a vacation or celebrating a special day.

Research debt consolidation and other ways to handle your debt together. That way you can both make an informed decision based on shared goals. If you need extra help, consider speaking with a debt expert. They may be able to answer questions and help you navigate the pros and cons of debt consolidation.