There’s an old West African saying, loosely translated into English as: “When the money’s gone, the lady will run!”
aside the gender stereotyping, the harsh reality is that the current
global recession is putting an immense strain on many relationships,
leading to tensions, arguments and break-ups. In short, many couples are
at risk of splitting up because of the credit crunch.
fact is that during more than a decade of cheap and easy access to
credit, many people lived well beyond their means and were (to quote
another source): “spending money they hadn’t earned to buy things they
didn’t need, to impress people they didn’t like.”
It’s now payback
time, but for many couples, the realization that the good times are
over is difficult to accept. The challenge of paying off debts and
cutting back on luxury items which were once considered ‘essential’ –
while working under the threat of redundancy – is causing a lot of
stress, resentment and frustration. This is a time when relationships
are really put to the test. It’s easy when things are good, but how do
people cope when things are not going so well?
couple in the world has been touched in some way by the global
recession, from those who don’t have much money and are worried about
how they are going to make ends meet, to those who are much better off,
but are concerned about losing what they have. In all cases, actual debt
or the potential threat of being in debt can trigger underlying,
unresolved issues that may have been swept under the carpet during the
The following scenario shows how one couple sank into a spiral of debt. Let’s call them Bola and Femi.
they met, Bola was a highly-paid IT consultant earning a six-figure
income, while Femi was a newly-qualified solicitor taking home a more
modest, but better-than-average salary. They were each paying a mortgage
on one-bedroom apartments and enjoyed a very active lifestyle, which
included frequent overseas travel, live shows, regularly dining out,
designer clothes and the latest gadgets.
Then Femi fell pregnant.
To please both sets of parents, they decided to get married. The wedding
was a showcase event with more than 250 people which, even with a
healthy contribution from both of their families, still cost the couple
more than £10,000. The newly-weds sold their properties and moved into a
three-bedroom home in a ‘nice’ part of town. The mortgage was more than
they’d been paying previously, but with Bola’s salary and the prospect
of Femi returning to work, they could easily manage the repayments.
a few months after giving birth to a baby boy, Femi fell pregnant
again. The couple decided that she should give up work to look after the
children and save on childcare costs. Then they were hit by a
bombshell: Bola was made redundant. His severance package was good, but
due to market conditions at the time, there were very few opportunities
for IT consultants and he was out of work for nine months before he gave
up job hunting. He then decided to retrain as a teacher which would
eventually lead to a new career and an 80% pay cut. House prices had
also started to fall, so the couple were soon in negative equity. With
virtually no money coming in, other than a tiny training bursary and
child benefit payments, the couple’s savings quickly ran out. To keep up
with their financial responsibilities, they were forced to sell their
cars, borrow money from the bank and max out their credit cards.
strain of their financial situation soon led to frequent arguments, a
trial separation and ultimately a divorce. It’s easy to see how Bola and
Femi went from a stress-free “double income no kids” existence, to a
“no income, two kids, no job, no money and big debts” hell.
It could happen to anyone.
how do you stop your relationship going into meltdown during the credit
crunch? As every couple’s situation is different, there is obviously no
one-size-fits-all solution. However, there are a few useful tips to
help couples deal with a ‘debt disaster’ and potentially save their
1. Tell the truth, the whole truth…: If you are
responsible for putting the household finances in jeopardy, be brutally
honest with yourself and your partner about the full extent of the debt
you are in. The UK Consumer Credit Counselling Service revealed that
women were more secretive than men when it came to hiding their debts;
but don’t fall into this trap, no matter how scared you are of your
partner’s reaction. Retrieve and deal with those unopened bills.
Creditors can sometimes be reasonable.
2. Avoid the blame game:
Some people may immediately react to a bad debt situation by pointing
the finger at their partner. However, raising the issue of a loved one’s
reckless spending which has benefited both parties is
counter-productive and is very likely lead to rows, rage and
recriminations. After all, where were the complaints when you were both
living the good life?
3. Plan: With no plan in place to deal with
money problems, couples are likely to go round in circles and spend a
lot of their time dwelling on the situation and fighting with each
other, rather than focusing on the bigger picture. Some hard choices may
need to be made, and these are best done with both parties actively
engaged with drawing up and executing a plan of action. There are many
debt management templates you can download from the internet and work on
4. Teamwork: If you’re in a loving relationship, you’re
not alone when it comes to solving problems. Resist the urge to go it
alone or to run away. Work with your partner to to develop creative
solutions to improving your financial situation. This will help nurture
an ‘us against the world’ mentality, useful when used positively, for
dealing with a crisis. Also, seek help (not necessarily financial) from
family, friends and debt specialists. If there are no relatives or
friends you can speak to confidentially, there are many groups,
charities and networks than can provide a discreet service and some very
5. Discipline: In times of stress, people tend to
seek the ‘basic pleasures’ of life: drink, drugs, gambling, food and
sex. As most of us will appreciate, these activities can be expensive,
potentially destructive and the benefits will be short-lived. Beyond
that, the consequences of overindulgence may potentially lead to
alcoholism, addiction, poverty, obesity and unwanted pregnancies – the
last thing anyone needs to solve their money problems.
most important thing to remember is that if you’re a couple being
crushed by the credit crunch, the way you view your money situation is
essentially an emotional response (anxiety/stress) to a physical problem
(debt/not having an income). Once you separate how you feel about the
situation with what you need to do about it, you’ll be in a much
stronger position to make a rational decision on how to come up with a
workable solution to your money and relationship problems.