Getting married is a momentous occasion—you’re choosing to legally commit to your partner in sickness and in health. And that’s something to celebrate. But before you say “I do,” it is important to understand how your student loan obligations might change after your big day.
After all, you’re ready to share your life, but do you have to share your student loans? Here are five things to know about student loans and marriage.
Open and Honest Communication is Key
Let’s be real for a second: money is stressful. In fact, money is one of the most common topics of relationship stress. Whether you’re arguing about high student loan payments or how much you want to spend on eating out every month, money can cause relationship problems.
There is good news, though: couples who talk openly about money daily or weekly are more likely to have strong marriages. That means that learning how to talk about money before you get married is one great way to create a strong relationship from the get-go, especially if you’re marrying someone with student loan debt, or have student loan debt yourself.
In addition to figuring out your money and budgeting style, it can be helpful to hash out the basics before your marital bliss is interrupted by your next student loan bill. For starters, it may be helpful to discuss exactly how much each of you owe on your student loans. It is important that you both understand exactly how much is owed so you can plan for repayment together.
Once you’ve got the hard numbers down, it may also be helpful to share what type of current student loan repayment plan you are on, and what your repayment priorities are. After all, if your partner wants to pay off their law school debt right away but you’re happy on an income-driven repayment plan as a school teacher, it is important that you have a plan for navigating potential disagreements.
While every relationship is different, all relationships will require decision-making about money. Learning to talk about money now can help set you up for success down the road.
Who is Responsible For Repayment?
You’re not automatically on the hook for your spouse’s loans. If you or your spouse took our student loans prior to your marriage, you likely won’t be responsible for those loans if your spouse stops paying.
Of course, if you or your spouse takes on new loans while you’re married and you live in a community property state, you may end up responsible for a portion of that debt.
The law is complicated, so if you’re worried about dividing up your assets before you get married, it is always good to talk to a lawyer. Many young couples are even now considering pre-nups to protect themselves and set up expectations in advance.
Will My Monthly Payments Change?
So then when it comes to student loans, marriage doesn’t change anything? Not so fast. One often-overlooked aspect of marriage is that it can change your income—and this matters for many reasons, including determining your monthly income-driven loan payments.
For example, if you’re on a repayment plan that uses your household income to determine your monthly payment, and are married and filing jointly, your lender will take into account both you and your spouse’s income, which could lead to higher monthly payments.
Likewise, you may miss out on the student loan interest deduction when it comes time to file your taxes. P.S., talking to an accountant or tax attorney when when it comes to all things taxes and student loans could be a smart idea. When in doubt, definitely speak with a licensed professional.
Thinking About Refinancing Your Loans with Your Spouse
Just because your student debt doesn’t automatically become a joint obligation the moment you say “I do” doesn’t mean you can’t combine your debt and focus on paying it off together.
Many couples choose to combine their student loan debt through refinancing so they can pay off one bill together, rather than juggling multiple debt payments.
Student loan debt and marriage can be stressful, and student loan refinancing allows you to combine multiple loans into one (potentially with a lower interest rate).
Of course, refinancing isn’t for everyone. If you or your spouse is planning on taking advantage of income-driven repayment or other federal repayment programs, joint refinancing with a private company could make you ineligible.
It’s important to start your marriage off on a strong foot by making sure that you and your partner can talk honestly about money. Together, you can navigate anything—including student loan debt.
SoFi Student Loan Refinance
Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.
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If you are a federal student loan borrower, you should consider all of your repayment opportunities including the opportunity to refinance your student loan debt at a lower APR or to extend your term to achieve a lower monthly payment. Please note that once you refinance federal student loans you will no longer be eligible for current or future flexible payment options available to federal loan borrowers, including but not limited to income-based repayment plans or extended repayment plans.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
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