Credit and Relationships: Truly For Better or Worse?

Relationships in which partners have substantial credit score disparity may be in for tougher times ahead—well, at least tough conversations as the couple gets more serious. 

But what about couples where both partners have good credit scores? According to new research they’re the ones more likely to have successful long-term relationships.

A new Federal Reserve Board study shows that partners with better credit histories were more likely to stay in long-term committed relationships. The research, led by three Fed economists, defined a “committed relationship” as a couple cohabiting and sharing an address for at least one year.

Couples with scores roughly 70 points above the national average score of 695 were 14 percent more likely to enter into a committed relationship. They were also less likely to separate after five or six years.

Those with major credit score differences didn’t fare as well. Partners with more than 66 credit score points between them were 24 percent more likely to separate during their second through fourth years, and 12 percent more likely to part ways in the fifth or sixth years of their relationships.

For those whose scores increased during the relationship? They were 37 percent less likely to separate. 

It’s no surprise that mismatched attitudes toward personal finances can cause a major strain between partners. A recent Bloomberg Businessweek article even suggested that credit score differences were no more trivial than “opposites attract” relationships where beauty, age or income may add varying levels of tension.

But make no mistake, with financial difficulties as a major cause of the nation’s 41 percent divorce rate, it’s important to tackle money and credit conversations head-on. Here are tips to help:

If you’re the one with bad credit:

Gather up the courage to tell your significant other about past credit and money mistakes. It doesn’t have to be a dreaded “we-need-to-talk” discussion but it’s necessary to own up to debt, late payments, or even a previous bankruptcy or foreclosure, especially if these blips happened recently enough to impact future purchases together as a couple.

Look at your credit histories together and discuss an action plan. It’s worse to mislead by living a lifestyle mismatched to your true financial situation. 

Don’t be ashamed, just get it out in the open. There’s no undressing quite like when a lender blames your credit score as the obstacle to the best joint car loan or mortgage. And if your partner isn’t interested in sticking around? Then find someone who is

If you’re the one with good credit:

It’s a great start if your partner is open about his/her less-than-perfect credit situation. Hear them out, be empathetic and encourage positive credit behaviors like paying on time, paying down on debt, and avoiding new credit applications. 

Suggest the use of credit management tools or apps; there are plenty, some of which I mentioned in Forbes

As discussed in Chapter 8’s “Credit and Love” section of “The Credit Cleanup Book,” you’ll ultimately have to decide if your partner’s imperfect credit past is something you can tolerate and are willing to help them work through.

Resenting, punishing, judging or disrespecting is a guaranteed way for your union’s slow death. That also doesn’t just mean throwing money at the problem; change is progress and proper credit usage requires education and learned behavior.