What happens when a couple share finances and it goes wrong?

Read Sarah’s story – a cautionary tale of overspending and joint credit card debt.

Relationships are all about sharing. Sharing memories, sharing lives, and for some couples – sharing money. This is all well and good when you’re both good with money, but if one of you isn’t… There could be some serious consequences for both of you.

Money is a big source of tension in relationships, and can even be a reason why they end. That’s exactly what happened to Sarah* (real name changed), who probably regrets tying herself to someone like Michael*, who not only left her with a broken heart, but a broken credit rating too.

Sarah’s story

I first met Michael when I was 27 and he was 29. We both lived in the city, had good jobs and met at a mutual friend’s birthday party in December 2019. You could say it was a bit of a whirlwind. The next couple of months were spent enjoying countless dates, weekends away – all the fun stuff new couples do. I was smitten.

Michael liked to treat me – that was his love language, and he had a taste for the finer things in life. Date nights weren’t just spent at any old restaurant or bar – everywhere we went was somewhere you’d expect to see an A-list star at any moment – and often we did. Michael worked in finance and had a well-paying job, so I figured this was normal. I had recently been promoted to a senior account manager at my marketing firm, so we were both enjoying the spoils of being two decent earners in our 20s in the big city.

Then in March 2020, things really accelerated. When the pandemic hit, we knew we couldn’t face time without each other, so made the hurried decision to move in together. He moved into my apartment, which had a little more space, and at first things were great. We loved being in our own little bubble and spent our days enjoying each other and making plans for the future. We didn’t know how long lockdowns were going to last, so we just made the most of it.

But as the weeks turned into months, things started to change. Michael’s firm took a huge hit during the pandemic, and laid off a bunch of people as a result – Michael included. But we weren’t frightened like a lot of people would be at this stage. Michael had a ton of savings (or so I thought), and was looking forward to taking a break from work. But the break turned out much longer than expected, and soon, things started to shift. As things started going back to normal, I was working hard and soon found myself covering more and more of our living costs while Michael mainly sat at home all day, claiming to be looking for work. At first, I figured it was only fair – he’d paid for so much in the past, it was surely my turn. We even took out a joint credit card (at his suggestion) to help cover some of his shortfall, which he insisted was being paid back every month. You need to remember that Michael worked in finance, and I trusted his judgment, so I didn’t really check the balance or our statements.

With the pandemic almost a memory, Michael finally found a new job, things started to take a turn in our relationship. We were spending less and less time together, and we soon wanted different things. A new job had invigorated Michael’s social life, so he was out a lot with his new coworkers and friends, while I was ready to settle down and take the next steps – envious of my friends who were getting married and having babies. Eventually, we broke up and Michael moved out. It was a tough time in my life, but I knew it was the right thing to do.

And then, the bills started coming in the mail. Not only was our credit card still active, but the balance was nearly $20,000 and hadn’t been paid in months. Michael had assured me the payments were being made, and I’d believed him. But things had simply just been brushed under the rug. I chased Michael to take care of it and pay his share, which he promised he would. By the time the money was paid back, I’d had to sacrifice a lot of my savings and had the account closed by the bank. Michael owed me more money, but communication soon stopped. When it was all over, I was just happy to free of him, but little did I know that he’d continue to haunt me in my financial dreams.

As I was getting ready to buy my own place, it was soon evident that this episode had a serious effect on my credit. I was turned down for several mortgages and have had to put my plans on hold while I work hard to rebuild my credit. The end of a bad relationship is something I can expect, but when it leaves you in a financial quagmire, it can feel like a never-ending hangover. I’m now in a new relationship where I’ve had to share my financial humiliation, and definitely have my guard up about sharing any finances in the future.

What to learn from Sarah’s cautionary tale

Sarah’s story is all too common, and many people are left with messed up credit thanks to an ex. While you can look back now and unpick all of your wrong decisions, it’s not going to fix things. What you can do is work to build your credit score back up and focus on saving and avoiding further debt. If you’re going to enter into a financial relationship with someone, make sure you are both involved in managing your finances, helping to avoid some nasty surprises in the future.

The good news for Sarah is that Michael has still not got a grip on his finances, so his financial future is looking bleak. Eventually, Sarah will have rebuilt her score and can focus on her future plans moving on with her life for good.