Should I be worried about my girlfriend's debt?

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nakedbird226
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Should I be worried about my girlfriend's debt?

Post by nakedbird226 »

I have been thinking about my financial future a lot since I first discovered this site a couple of months back. I have been able to start a decent 401k at work, open up and fully fund a Roth IRA for 2013 (plan to fully fund every year), and come up with a plan to pay off my remaining student loans of around $ 14,500 by the end of the year.

After feeling somewhat on the right path myself, I began thinking about my girlfriend's financially situation and how it might dictate some of our future plans together. To give you a better idea of where we are with our relationship...I have known her for about 15 years of so. We grew up together as neighbors actually. She was my best friend growing up, and being with her has only brought us closer. I can't see myself being with anyone else. I believe marriage is a good possibility in a few years when I feel like we are in a better place financially.

My girlfriend is set to graduate from school with a masters degree in December 2014 with a heap of student loan debt. I am not sure what the exact amount is, but I am going to assume it will be between 60k-90k in student loan debt (I really hope it isn't more).

By the time she graduates, I should be debt free. When she finds a job, which I don't think she will have much of a problem with, our salaries combined would be somewhere around 100k-115k (could be more). I had planned on moving out with her to an apartment closer to our jobs when she did find a job, but I am wondering if we should wait on this for awhile. My girlfriend doesn't know a ton about finances, but I think if I sat down with her and talk about my financial goals, I think she would understand the importance of trying to tackle at least some of her student loan debt sooner than later.

Do you think it would be a good idea to try to stick it out and live at home for awhile so that my girlfriend and I can save some money to help pay down some of her student loans?

It worries me that she will have that much debt on her shoulders, and I feel like she and I should focus on taking care of some of that quickly.

Am I worrying too much? Should I just let her make her monthly payments and go about our lives?

I feel like getting that large payment off of our shoulders sooner than later would help us down the road.

I do not want to let her debt control how we live our lives. Yes I think it is important to focus on paying it off, but I still want to be able to live now, do fun things with her, and enjoy our time together now. What is the best route for us?
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Re: Should I be worried about my girlfriend's debt?

Post by The Wizard »

It would be good to talk with her and find out if ostensibly you're on the same page with this.
But they are HER loans, not yours. Would be good if they have an interest rate in the 3% range, not 6.5% or worse.
Does she seem to be frugal now or not so much?
Perhaps just rent a modest apartment for the first year or two while she makes double payments on the loans after she graduates?
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rob
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Re: Should I be worried about my girlfriend's debt?

Post by rob »

Talk to her but depends what the master is in.... basket weaving or medicine will make a difference on the future ability to repay the loans :-)
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archbish99
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Re: Should I be worried about my girlfriend's debt?

Post by archbish99 »

For now, they are her loans, and not your business. If/when you get married, you may choose to have separate finances, in which case they remain mostly her business. My wife and I came into our marriage with relatively little, and opted to combine finances and not look back. We paid off her student loans aggressively, and haven't regretted that.
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Re: Should I be worried about my girlfriend's debt?

Post by renjuzone »

OP, I know and feel your dilemma. I was in the same boat with my girlfriend at that time (now wife), about 10 years ago. The key is to have a detailed communication with her. It is important to know that you both have similar financial values. My concern was that she would be a spendthrift. Turns out, she thought I was a miser. Heartfelt deep conversations helped a lot! We were able to make middle ground and prioritize debt reduction over lavish spending.

OP, remember finance, while important is only one part of ones life. Something's can't have a dollar value attached. Good luck through the process!
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nakedbird226
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Re: Should I be worried about my girlfriend's debt?

Post by nakedbird226 »

The Wizard wrote:It would be good to talk with her and find out if ostensibly you're on the same page with this.
But they are HER loans, not yours. Would be good if they have an interest rate in the 3% range, not 6.5% or worse.
Does she seem to be frugal now or not so much?
Perhaps just rent a modest apartment for the first year or two while she makes double payments on the loans after she graduates?
She had to work all through her undergrad to pay for her living expenses and other things, so I know she knows how to take care of herself. I think the first step is definitely talking to her about these things and see if we are on the same page.
rob wrote:Talk to her but depends what the master is in.... basket weaving or medicine will make a difference on the future ability to repay the loans :-)
She will be a registered dietitian
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ResearchMed
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Re: Should I be worried about my girlfriend's debt?

Post by ResearchMed »

nakedbird226, you wrote that "I do not want to let her debt control how we live our lives".

The first issue is to have a discussion with her. Hopefully you can at least bring this up as a topic for discussion, or perhaps have that discussion straightaway. (If not, that's a different problem.)

Assuming she also would like to get this debt behind her (or both of you), then stringing it out, paying more in interest rather than less, is a way *to* have it control your lives, far more than getting it paid off, or at least paid down reasonably quickly.

If you are such good friends (a wonderful situation, truly), then chances are good that you can discuss this, although "money matters" are among the tricky topics.

But - Money Matters!

So start a comfortable discussion, one aimed at figuring out what she wants, especially, in a non-judgmental way (that might be difficult, but it's important, at least for a start).
This type of discussion gets a lot more relevant if/when you both decide that your futures *are* linked, of course.

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Re: Should I be worried about my girlfriend's debt?

Post by leonard »

The person with the debt needs to develop and execute on the plan. You can't do it for them.

So, set up a time to talk and ask some broad questions about her financial future. Then, let her articulate her plan - or lack there of. Your plan isn't going to mean anything until you understand her plan and how she thinks about this debt.
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Re: Should I be worried about my girlfriend's debt?

Post by Kircheis »

I think that level of debt should be manageable on your income (although I realize that you are guessing about the total amount of debt and income). If you really think that she's the "one", I would talk to her about how to maximize her loan payments after she graduates to knock out the loan quickly. If she does not want to, that may be a differnt issue.
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Re: Should I be worried about my girlfriend's debt?

Post by DTSC »

It's not your problem unless you intend to marry her...
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Re: Should I be worried about my girlfriend's debt?

Post by nakedbird226 »

DTSC wrote:It's not your problem unless you intend to marry her...
Let's assume this will be happening in a couple years.
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Re: Should I be worried about my girlfriend's debt?

Post by fposte »

Where does she plan on working, and where are her loans from? She might be eligible for Public Service Loan Forgiveness down the line, so be sure to factor that in if you're crunching numbers.

Do you mean you don't want her debt to control you or you don't want it to affect you at all? "Control" is an emotional term that can't be clearly quantified, but I would presume that her paying more toward the debt in short term would mean being more controlled by it for the duration, because it interferes more with available funds for other things. Some people find duration more problematic than intensity, and maybe you're one of them; however, it's also reasonable for somebody to be less bothered by duration (30-year mortgage) than intensity (full house price).

I agree with others that you two really need to have a serious conversation about this, but Is it possible that what you're really saying is you can't see marrying her while she's got loans to pay back?
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Re: Should I be worried about my girlfriend's debt?

Post by DTSC »

nakedbird226 wrote:
DTSC wrote:It's not your problem unless you intend to marry her...
Let's assume this will be happening in a couple years.
Then IMHO it would depend on 1) whether her degree will help her get a relatively high paying job and 2) whether she accumulated the debt because she had to (i.e. just didn't have money for school) or whether she had a lavish lifestyle. It it is because she lives well above her means and squanders the money (debt), then be afraid. Be very afraid.

I read some more. Dietitians don't make great money, but it's not horrible either, if she works for a hospital full time. I don't think your estimate of $90,000 is outrageous - IF one is frugal. In my state, the flagship State U costs $30K per year and not everyone is lucky enough to have rich (or poor) enough parents to pay for school. However, if the debt was accumulated because of a lack of frugality, then you're screwed no matter what.
Last edited by DTSC on Tue May 06, 2014 11:44 am, edited 1 time in total.
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Re: Should I be worried about my girlfriend's debt?

Post by tainted-meat »

Kircheis wrote:I think that level of debt should be manageable on your income (although I realize that you are guessing about the total amount of debt and income). If you really think that she's the "one", I would talk to her about how to maximize her loan payments after she graduates to knock out the loan quickly. If she does not want to, that may be a differnt issue.
I think this sums it up pretty well. Talking about things that matter are difficult at times, but do need to be addressed. It will save you from lots of problems down the road and make it easier to have other difficult discussions.
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Re: Should I be worried about my girlfriend's debt?

Post by midareff »

Other than a general discussion of financial values, which you should have a handle on if you have known her 15 years, there is little of concern here. You have graduated and been out paying off your debt. She is still in school and has not had the opportunity you have had to pay that debt down or off. I'd just look at the debt as what you have to help assume so you both have a life with better income in the future.

:oops: you have no idea :idea: how much the wrong girl can cost :shock: , $90K for the winner is nothing :mrgreen: !
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Re: Should I be worried about my girlfriend's debt?

Post by nakedbird226 »

DTSC wrote:
nakedbird226 wrote:
DTSC wrote:It's not your problem unless you intend to marry her...
Let's assume this will be happening in a couple years.
Then IMHO it would depend on 1) whether her degree will help her get a relatively high paying job and 2) whether she accumulated the debt because she had to (i.e. just didn't have money for school) or whether she had a lavish lifestyle. It it is because she lives well above her means and squanders the money (debt), then be afraid. Be very afraid.
She just didn't have the money for school. Her degree should get her a salary between 50-60k. She doesn't live well above her means, but I think she knows she can afford to lay off of the Starbucks here and there.
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Re: Should I be worried about my girlfriend's debt?

Post by DTSC »

nakedbird226 wrote:
DTSC wrote:
nakedbird226 wrote:
DTSC wrote:It's not your problem unless you intend to marry her...
Let's assume this will be happening in a couple years.
Then IMHO it would depend on 1) whether her degree will help her get a relatively high paying job and 2) whether she accumulated the debt because she had to (i.e. just didn't have money for school) or whether she had a lavish lifestyle. It it is because she lives well above her means and squanders the money (debt), then be afraid. Be very afraid.
She just didn't have the money for school. Her degree should get her a salary between 50-60k. She doesn't live well above her means, but I think she knows she can afford to lay off of the Starbucks here and there.
Buy her a nice coffee maker for starters!
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Re: Should I be worried about my girlfriend's debt?

Post by nash031 »

My quick thoughts:

- What is the interest rate on the student loans? I "inherited" about $15,000 in student loans from my wife's college when we married a few years ago, but at less than 1% interest, we continue to make the minimum payment and carry on smartly.

- You should absolutely NOT consider paying anything on her behalf until you are married, in my opinion. Things don't always work out, even when you're sure they're going to.

- Does she also carry a lot of revolving (credit card) debt? Other high interest debt like a car loan? What are her spending habits? If it is limited only to student loans to help her get a graduate degree, I would not be terribly concerned by it. If she carries a lot of other debt or has expensive tastes, that's really going to impact your ability to save and retire in the long run far more than paying for her education.

- Agree with the others that you need to have the "money talk" and make sure you're on the same page right now. If you're not, can she get on your page (or you on hers)? If not now, it's never going to happen and should be viewed as a big time red flag for the long-term relationship.
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Re: Should I be worried about my girlfriend's debt?

Post by CFM300 »

This is an aside, but I think it's worth mentioning, for the OP and others.

I don't think you can make any predictions about her future spending habits based on her past. I've seen people who were frugal when in grad school, but only because they had to be. As soon as they began earning a high income, they spent foolishly, living paycheck to paycheck. Conversely, I've seen people who made a lot of poor financial decisions when single become quite responsible once married. Often, they just didn't understand finances, and once they had a spouse who either showed them the way or took on the role of money-manager for them, they lived modestly and happily.
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Re: Should I be worried about my girlfriend's debt?

Post by fposte »

nakedbird226 wrote:
She just didn't have the money for school. Her degree should get her a salary between 50-60k. She doesn't live well above her means, but I think she knows she can afford to lay off of the Starbucks here and there.
Does "above her means" mean that she carries credit card debt and gets paid for by you/parents/whoever, or does it mean she's buying Starbucks with money you think should go to saving to pay her loans off faster? Because the latter wouldn't be about her means but your taste, and I think it's really important to be honest about that when you go into the conversation--if you frame it as her needing to handle her money the way you want because reasons, that's asking for trouble.
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Re: Should I be worried about my girlfriend's debt?

Post by nakedbird226 »

nash031 wrote:My quick thoughts:

- What is the interest rate on the student loans? I "inherited" about $15,000 in student loans from my wife's college when we married a few years ago, but at less than 1% interest, we continue to make the minimum payment and carry on smartly.

- You should absolutely NOT consider paying anything on her behalf until you are married, in my opinion. Things don't always work out, even when you're sure they're going to.

- Does she also carry a lot of revolving (credit card) debt? Other high interest debt like a car loan? What are her spending habits? If it is limited only to student loans to help her get a graduate degree, I would not be terribly concerned by it. If she carries a lot of other debt or has expensive tastes, that's really going to impact your ability to save and retire in the long run far more than paying for her education.

- Agree with the others that you need to have the "money talk" and make sure you're on the same page right now. If you're not, can she get on your page (or you on hers)? If not now, it's never going to happen and should be viewed as a big time red flag for the long-term relationship.
I'm not sure how much the interest rates will be, but I doubt they will be that low.
Just to clear this up, I don't plan on helping her pay until we are married. Although I do not want to wait until then to talk about all this and figure out what is a good path for her to pay off her debt, whether or not I help her with this.
No credit card debt for her. We grew up in pretty similar families as far as wealth goes, so I don't think she expects to be able to go buying whatever she wants.

I was thinking of maybe giving her some sort of incentive to get her more motivated about paying off student loans when the time comes. Perhaps something along the lines of every time she makes an additional payment during a given month, I will match that amount for the month. I could even do this when we aren't married yet, but instead of giving her this money, I could set it aside in my bank account and use it to go towards her student loans when the time comes to get married.
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Re: Should I be worried about my girlfriend's debt?

Post by fposte »

nakedbird226 wrote:My quick thoughts:
I was thinking of maybe giving her some sort of incentive to get her more motivated about paying off student loans when the time comes. Perhaps something along the lines of every time she makes an additional payment during a given month, I will match that amount for the month. I could even do this when we aren't married yet, but instead of giving her this money, I could set it aside in my bank account and use it to go towards her student loans when the time comes to get married.
I think you're risking getting ahead of yourself here, because nice as this sounds, it's about making her do what you want her to do. You want to have a conversation that's about discovery, not influence--how does she feel about the loans? What are her plans? How flexible is she, and for that matter, how flexible are you?
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Re: Should I be worried about my girlfriend's debt?

Post by nakedbird226 »

fposte wrote:
nakedbird226 wrote:My quick thoughts:
I was thinking of maybe giving her some sort of incentive to get her more motivated about paying off student loans when the time comes. Perhaps something along the lines of every time she makes an additional payment during a given month, I will match that amount for the month. I could even do this when we aren't married yet, but instead of giving her this money, I could set it aside in my bank account and use it to go towards her student loans when the time comes to get married.
I think you're risking getting ahead of yourself here, because nice as this sounds, it's about making her do what you want her to do. You want to have a conversation that's about discovery, not influence--how does she feel about the loans? What are her plans? How flexible is she, and for that matter, how flexible are you?
I see where you are coming from and you may be right. I think when we talk about it more she will see where I am coming from and be able to make an informed decision. I understand that these are her loans and it is her responsibility to take care of them. However, she does enjoy talking about the future and I hope that she sees that it is important to me to have our financial future heading on the right path. I really don't think it will be too much of an issue. I will just have to see what she wants and go from there. All I can do is talk to her about how I feel about the situation and see how she feels about it. I would really like to introduce her to this site and maybe read a boglehead's book if she is willing to. I think she would agree to reading a book :)
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Re: Should I be worried about my girlfriend's debt?

Post by DTSC »

nakedbird226 wrote:
fposte wrote:
nakedbird226 wrote:My quick thoughts:
I was thinking of maybe giving her some sort of incentive to get her more motivated about paying off student loans when the time comes. Perhaps something along the lines of every time she makes an additional payment during a given month, I will match that amount for the month. I could even do this when we aren't married yet, but instead of giving her this money, I could set it aside in my bank account and use it to go towards her student loans when the time comes to get married.
I think you're risking getting ahead of yourself here, because nice as this sounds, it's about making her do what you want her to do. You want to have a conversation that's about discovery, not influence--how does she feel about the loans? What are her plans? How flexible is she, and for that matter, how flexible are you?
I see where you are coming from and you may be right. I think when we talk about it more she will see where I am coming from and be able to make an informed decision. I understand that these are her loans and it is her responsibility to take care of them. However, she does enjoy talking about the future and I hope that she sees that it is important to me to have our financial future heading on the right path. I really don't think it will be too much of an issue. I will just have to see what she wants and go from there. All I can do is talk to her about how I feel about the situation and see how she feels about it. I would really like to introduce her to this site and maybe read a boglehead's book if she is willing to. I think she would agree to reading a book :)

The other issue is - how does she feel about you? Does she feel you're the one, or the one right now? If the latter, then it's a moot point.
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Re: Should I be worried about my girlfriend's debt?

Post by CFM300 »

I already made this point a couple of posts up, and don't want to belabor the point, but again...

Realize that there's a lot of middle ground between her loans being her problem and her loans being your problem. She may be perfectly willing to pool income when you're married and live modestly -- without being interested at all in reading this forum or personal finance books or actually working out the mechanics of budgeting, servicing loans, etc. If she's totally happy to let you handle all of that -- and is earning good money, not spending it foolishly, taking your advice on retirement savings, loan repayment, etc. -- then isn't that enough?
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Re: Should I be worried about my girlfriend's debt?

Post by nakedbird226 »

DTSC wrote:

The other issue is - how does she feel about you? Does she feel you're the one, or the one right now? If the latter, then it's a moot point.
I am pretty confident we are in this for the long haul
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Re: Should I be worried about my girlfriend's debt?

Post by nakedbird226 »

CFM300 wrote:I already made this point a couple of posts up, and don't want to belabor the point, but again...

Realize that there's a lot of middle ground between her loans being her problem and her loans being your problem. She may be perfectly willing to pool income when you're married and live modestly -- without being interested at all in reading this forum or personal finance books or actually working out the mechanics of budgeting, servicing loans, etc. If she's totally happy to let you handle all of that -- and is earning good money, not spending it foolishly, taking your advice on retirement savings, loan repayment, etc. -- then isn't that enough?
That would be great, and yes that would be enough. I would at least want her to have enough knowledge about finance in case something were to happen to me down the road. I suppose I could just tell her to come to this site if something were to happen
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Re: Should I be worried about my girlfriend's debt?

Post by IlliniDave »

nakedbird226 wrote:
DTSC wrote:

The other issue is - how does she feel about you? Does she feel you're the one, or the one right now? If the latter, then it's a moot point.
I am pretty confident we are in this for the long haul
I would wait until it's certain the two of you are in it together for the long haul, then worry about it. Someone else mentioned the cart being before the horse above. Until/unless she asks for your thoughts/input on the matter or the relationship formalizes, I'd say let it go, and make financial decisions based on your own situation.
Don't do something. Just stand there!
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Re: Should I be worried about my girlfriend's debt?

Post by surfstar »

nakedbird226 wrote:
DTSC wrote:

The other issue is - how does she feel about you? Does she feel you're the one, or the one right now? If the latter, then it's a moot point.
I am pretty confident we are in this for the long haul
Have either of you seriously dated anyone else?

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To me, that's the red flag. Not someone graduating with student loan debt.
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Re: Should I be worried about my girlfriend's debt?

Post by steadyeddy »

I would communicate that knocking out the debt quickly [at the expense of lifestyle] is important to you and then let her do the talking. How she responds is important.

My wife pokes fun at my reading Bogleheads, but she is on board with living below our means because she respects that saving is something I value.
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Re: Should I be worried about my girlfriend's debt?

Post by Steady »

She doesn't graduate until December and your worried about her loans already? Sounds like you might be trying to find a way to talk yourself out of the relationship. She went to school for a reason and she's getting a masters she must have a brain.
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Re: Should I be worried about my girlfriend's debt?

Post by DTSC »

Steady wrote:She doesn't graduate until December and your worried about her loans already? Sounds like you might be trying to find a way to talk yourself out of the relationship. She went to school for a reason and she's getting a masters she must have a brain.
Having a Master's degree does NOT mean one has money sense. I know plenty of highly leveraged, big spending, smart doctors (and other professionals).

If both of you are on the same page and thinking being together for the long haul, then start working on healthy saving and spending habits together. "The Millionaire Next Door" is another excellent book.

I don't think it's premature to worry about money issues with a potential spouse, as money is a major source of arguments/divorce. To me, the issue isn't the amount of debt, but her attitudes towards money and spending now, which might be a predictor of her future behavior.
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Re: Should I be worried about my girlfriend's debt?

Post by bucksfan2 »

This is an interesting question to ask these boglehead folk. I think often on this forum too much focus goes towards finances and money and not enough goes towards the enjoyment of life.

If this is the girl you intend to be with for the foreseeable future this question is pretty funny. $60K-$90K is pretty substantial amount of money, but is that really an amount of money that would scare you away from a lifetime of happiness with your girlfriend? It sounds like student loan debt is the only debt she currently has, and in her field, a masters is often required. Its one of those necessary evils, you choose a career that you think you will enjoy but it requires more schooling and more debt.

Just a couple of quick thoughts. That is her debt, debt she knew she was getting into when she started graduate school (and maybe undergrad.) I would stay hands off until you take the next step, engagement. If you head down that path it may be time to start to mold your finances together, work to get that student loan paid down, but for now that is hers. I wouldn't be scared off by it, I wouldn't pinch pennies, I wouldn't sacrifice what you want to do relationship wise with her because of it.

I started dating my wife towards the end of college. Thankfully neither of us had student debt, or any debt for that matter. When she got a job, or a new job, she would ask me for advice on what to do with her retirement plan options. She wants little to nothing to do with finances. It was one of those things that as long as she paid off her bills without missing payments or accumulating late penalties, everything was ok. Once we got married I pretty much took over our finances and she is perfectly happy with that. She is in charge of paying one bill of ours, cell phone bill, and more often than not I have to remind her to pay it. If I had any advice to give, do what makes you happy. In the end its the journey that makes life fun, not how many zero's are in your bank account.
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Re: Should I be worried about my girlfriend's debt?

Post by NORDO »

DTSC wrote:I don't think it's premature to worry about money issues with a potential spouse, as money is a major source of arguments/divorce. To me, the issue isn't the amount of debt, but her attitudes towards money and spending now, which might be a predictor of her future behavior.
bucksfan2 wrote:I started dating my wife towards the end of college. Thankfully neither of us had student debt, or any debt for that matter. When she got a job, or a new job, she would ask me for advice on what to do with her retirement plan options. She wants little to nothing to do with finances. It was one of those things that as long as she paid off her bills without missing payments or accumulating late penalties, everything was ok. Once we got married I pretty much took over our finances and she is perfectly happy with that. She is in charge of paying one bill of ours, cell phone bill, and more often than not I have to remind her to pay it. If I had any advice to give, do what makes you happy. In the end its the journey that makes life fun, not how many zero's are in your bank account.
My wife is much the same. I manage most everything now. I helped her set up her initial retirement plan choices (we weren't even engaged at that point) and we've always talked openly about finances.

That's my main advice whenever friends ask about relationships / marriage - discuss your finances well before your wedding day.

We've known so many friends who got married and suddenly realized their spouse was $40K in debt or whatever. I realize the Boglehead crowd isn't full of "average Americans" so that's probably rather unlikely here... but still, it begs the mention. Know what you're getting into. Not saying it's a deal-breaker but you need to know where you two stand on the important things (finances, religion, children, etc.) before you're married.
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nakedbird226
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Re: Should I be worried about my girlfriend's debt?

Post by nakedbird226 »

To those think I am trying to talk myself out of the relationship that is not the case. I have already accepted the fact that she will have a good chunk of debt when we do decide to take that next step in our relationship. I just wanted some opinions of how I go about working with her to pay down this debt, assuming we do end up marrying in a few years.

And yes we have both been in serious relationships before.
FutureDDS91
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Re: Should I be worried about my girlfriend's debt?

Post by FutureDDS91 »

I see a lot of parallels between my situation and yours. However, for me, the shoe is on the other foot--I'm the one with student loan debt, whereas his parents paid (and continue to pay) for his school. We have been best friends for about 10 years.

I find it really, realy surprising that you two--as friends of 15 years--haven't already talked about this. That is just downright strange to me. My boyfriend and I have been completely open with each other about money from the get-go. Though our finances aren't technically "combined" yet, it is all out in the open. I can't imagine a situation in which I wouldn't let him know how much debt I had. We discuss our current and future finances quite often, actually. Though we won't marry until we graduate (which is another three years), we have been completely committed to each other for a long time. Nothing is ever a secret. We don't ever have to "guess" what is going on with one another.

Right now, you plan on marrying her. Does she plan on marrying you? You're just doing a lot of guesswork. You're guessing at her loan amount. You're guessing a marriage is in the cards. You're guessing she doesn't have a financial plan.

This is your best friend that we're talking about--why don't you know? You may be worrying for nothing, and you don't seem to be giving her the benefit of the doubt. Sometimes, debt is necessary.

If you don't even know what your current situation is actually like, how can we provide any good advice?

Just some food for thought. :happy
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nakedbird226
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Re: Should I be worried about my girlfriend's debt?

Post by nakedbird226 »

FutureDDS91 wrote: Right now, you plan on marrying her. Does she plan on marrying you? You're just doing a lot of guesswork. You're guessing at her loan amount. You're guessing a marriage is in the cards. You're guessing she doesn't have a financial plan.
Like I have said before, let's assume we are planning on marriage. At this point in time she doesn't know what her loan amount is. I am sure we can figure this out pretty easily. She does not have a financial plan. We have talked about this very briefly before and she plans on thinking about it more in the near future. Grad school is more on her mind at the moment.
Calm Man
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Re: Should I be worried about my girlfriend's debt?

Post by Calm Man »

I frankly think that in this day and age, 60-90 K or even 200K of debt is not excessive. More important are her spendign patterns, interest in paying it down and saving in my opinion.
FutureDDS91
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Re: Should I be worried about my girlfriend's debt?

Post by FutureDDS91 »

nakedbird226 wrote: Like I have said before, let's assume we are planning on marriage. At this point in time she doesn't know what her loan amount is. I am sure we can figure this out pretty easily. She does not have a financial plan. We have talked about this very briefly before and she plans on thinking about it more in the near future. Grad school is more on her mind at the moment.
I can understand your worries if she doesn't even know how much debt she has. ...how can a person just not know? Maybe that is more common that I assume it is, but it doesn't seem like the wisest thing.

How about you just have her find out today: https://www.nslds.ed.gov/nslds_SA/
It takes just a few minutes. :happy And that way, you guys can better develop a plan! I agree with you that it is much better to think about it now than it is once she graduates. Plus, planning to tackle this together may ultimately bring the two of you closer.
DTSC
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Re: Should I be worried about my girlfriend's debt?

Post by DTSC »

FutureDDS91 wrote:
nakedbird226 wrote: Like I have said before, let's assume we are planning on marriage. At this point in time she doesn't know what her loan amount is. I am sure we can figure this out pretty easily. She does not have a financial plan. We have talked about this very briefly before and she plans on thinking about it more in the near future. Grad school is more on her mind at the moment.
I can understand your worries if she doesn't even know how much debt she has. ...how can a person just not know? Maybe that is more common that I assume it is, but it doesn't seem like the wisest thing.

How about you just have her find out today: https://www.nslds.ed.gov/nslds_SA/
It takes just a few minutes. :happy And that way, you guys can better develop a plan! I agree with you that it is much better to think about it now than it is once she graduates. Plus, planning to tackle this together may ultimately bring the two of you closer.
EmergDoc who posts here has a new book out which has some relevance to your situation, especially with regard to loan repayment, even if neither of you are doctors. In any event, it's an excellent financially planning book. Check it out. Not bad for future DDS's too.

http://www.amazon.com/White-Coat-Invest ... t+investor
FutureDDS91
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Re: Should I be worried about my girlfriend's debt?

Post by FutureDDS91 »

DTSC wrote: EmergDoc who posts here has a new book out which has some relevance to your situation, especially with regard to loan repayment, even if neither of you are doctors. In any event, it's an excellent financially planning book. Check it out. Not bad for future DDS's too.

http://www.amazon.com/White-Coat-Invest ... t+investor
Thank you so much--I actually follow his blog and ordered the book last week. :D
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Nuvoletta
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Re: Should I be worried about my girlfriend's debt?

Post by Nuvoletta »

nakedbird226 wrote:At this point in time she doesn't know what her loan amount is. I am sure we can figure this out pretty easily. She does not have a financial plan. We have talked about this very briefly before and she plans on thinking about it more in the near future. Grad school is more on her mind at the moment.
Wow. This is what got me. Sorry, if she doesn't even know what her "debt number" is, then that is a huge red flag. Various possibilities including head-in-sand not wanting to confront the reality (bad) and consciously or unconsciously thinking you'll be there to rescue her (worse). Realistically, given your good habits and the apparent length and strength of your relationship, the latter is understandable, but still worrisome.

I hope I don't get flamed for this, but I am somewhat skeptical of most folks acquiring that much debt for college. Maybe for a doctor or other similar type of degree where the probable return on salary is anticipated to be high. Otherwise, a frugal approach is junior or community college for two years, then a school one can afford. One girl I went to school with got her engineering degree from an excellent school in 8 years, working one year, going to school one year. What I observed with my bonus daughter was that she had lower cost options (living at home, taking the bus, cooking her own meals, used books through mail order) and higher cost options (apartment with her own exclusive bathroom and closet, owning car + parking, eating out every day/meal, new books). Another kid I knew shared a two-bedroom apartment with two other kids, they each cooked one out of three nights, and he only knew one recipe involving three cans and salt :). My point is, if you aren't conscious of your debt number going up with every choice you make, you aren't making the difficult decisions. And that's potentially a bad sign.

Your responses show that you are conscientious and caring and want to approach this the right way. You need to bring this up. You are absolutely correct to be starting this conversation before moving toward engagement and beyond…what if y'all start talking about this and you find out things are a lot worse than you even imagine? Or that she isn't as concerned about debt as you are? As you say, you simply don't know all the details yet--you haven't talked.

Best of luck. You sound like a truly nice guy.
renjuzone
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Re: Should I be worried about my girlfriend's debt?

Post by renjuzone »

surfstar wrote:
Have either of you seriously dated anyone else?

Diversify. All your funds in one stock can lead to portfolio collapse...


To me, that's the red flag.
I sincerely hope that you were kidding and not giving real advice.
RobInCT
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Re: Should I be worried about my girlfriend's debt?

Post by RobInCT »

To me it sounds like OP is trying to have it both ways. On one hand he wants to insist he has no responsibility for any of his girlfriend's debt until they get married (perfectly okay), but on the other hand he seems to feel like he has a right to dictate/manage how she deals with the debt he disclaims all responsibility for (not okay).

OP, I think it's good and important to have conversations with the woman you are considering marrying about how she feels about money, debt, and savings and also about your joint plans for securing a secure financial future together. If you were telling us you were considering marrying her without having these conversations, I would be telling you you were making a huge mistake.

But when you start saying things like you want to "figure out what is a good path for her to pay off her debt, whether or not [you] help her with this" or giving her "incentive payments" (that you will withhold until you are actually married) to make sure she pays her debt off on the time frame you would prefer, instead of the one she might prefer, to me that crosses a line. You can't have it both ways. Either a) you're together and committed and it's a joint problem that will be solved jointly, or b) you're still figuring things out and it's a separate problem into which you should be provided some insight as part of the natural process of figuring out whether you're compatible for the long-term but over which you have no right to exert any actual decision-making authority or control.

Having her pay down her debt aggressively and early may be the best plan for your future, but it may not be the best plan for hers. You can't expect her to plan her financial future now on the assumption that you are going to get married and that she she should therefore be doing whatever would be best for your joint future while you yourself are saying that it's too soon for you to take any responsibility for her debt.

I'm NOT suggesting you take responsibility for her debt now. Far from it. I think that would be a very foolish move. What I am suggesting is that you back off. You aren't married, and you aren't engaged. Let her make her own decisions about what is right for her. If you think those decisions indicate an attitude towards money or towards planning for the future that you find problematic, then that's another issue that needs to be addressed separately.
BigTom
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Re: Should I be worried about my girlfriend's debt?

Post by BigTom »

rob wrote:Talk to her but depends what the master is in.... basket weaving or medicine will make a difference on the future ability to repay the loans :-)
Lol I'll never understand that .

To the OP I don't think this is a bad situation, if she is graduating and getting a good job you should be fine . It's not like she is racking up credit cards or something she is bettering herself with school . Plus these days I think it would be quite difficult to find someone that doesn't have school loans like that .
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HardKnocker
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Re: Should I be worried about my girlfriend's debt?

Post by HardKnocker »

nakedbird226 wrote:To give you a better idea of where we are with our relationship...I have known her for about 15 years of so. We grew up together as neighbors actually. She was my best friend growing up, and being with her has only brought us closer. I can't see myself being with anyone else.
I think you will be ok. This isn't someone you just met last week.

You should know exactly how much debt is really there. Ask her.

I'm always amazed that people are afraid to ask questions. Just ask.
“Gold gets dug out of the ground, then we melt it down, dig another hole, bury it again and pay people to stand around guarding it. It has no utility.”--Warren Buffett
FutureDDS91
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Re: Should I be worried about my girlfriend's debt?

Post by FutureDDS91 »

HardKnocker wrote:
You should know exactly how much debt is really there. Ask her.

I'm always amazed that people are afraid to ask questions. Just ask.
The problem is that she doesn't even know how much debt she has.
FutureDDS91
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Re: Should I be worried about my girlfriend's debt?

Post by FutureDDS91 »

BigTom wrote:
rob wrote:Talk to her but depends what the master is in.... basket weaving or medicine will make a difference on the future ability to repay the loans :-)
Lol I'll never understand that .

To the OP I don't think this is a bad situation, if she is graduating and getting a good job you should be fine . It's not like she is racking up credit cards or something she is bettering herself with school . Plus these days I think it would be quite difficult to find someone that doesn't have school loans like that .
BigTom--To an extent, student loan debt is a good thing. However, it definitely gets to a point where the debt is crippling and no longer worth it. The cost of tuition/fees/etc. nowadays is becoming OUTRAGEOUS.

As a personal example, I have many peers who are going to be 300k-500k in debt when they graduate from dental school (and that's not counting any undergrad loans they may have). Grad student loan rates are at 5.41%/6.41% and are only predicted to rise. The interest accumulates while in school and capitalizes upon graduation.

Then, on top of that huge chunk of money, there are other debts that will inevitably be incurred fairly soon after graduation--buying a practice, a car, a home, etc.

Even for a fairly lucrative profession like dentistry, there is a breaking point where the loans are too much. In my personal opinion, that breaking point is 300k at the VERY most, and that is if a person has no undergrad debt. Even though a typical dentist can realistically make ~100k (and that's a fairly low estimate for many) in their first year after graduation, plugging that size loan into a repayment calculator produces some ghastly monthly repayments.

The interest rate is scary. The cost is outrageous. There is definitely a breaking point. I feel worried for many of my peers, especially those in professions without the same earning potential.
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nakedbird226
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Re: Should I be worried about my girlfriend's debt?

Post by nakedbird226 »

I did talk to her about it briefly yesterday. She seemed to agree that she doesn't want that huge debt for long and wants to try to get rid of it sooner or later. Having said that, I am still not sure how much it will end up being. She was open to talking about it, but she is really busy with grad school and wants to focus on getting that all taken care of before stressing about how much she owes which is understandable. I suppose until then I could try to get her to figure our the loan amount so that we can come up with a plan when she has more time.
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Re: Should I be worried about my girlfriend's debt?

Post by placeholder »

At most schools finals are either underway or about to so I'd wait a month or so.
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