Love, Marriage, and Financial Disaster

Don’t let love leave you bankrupt.

Janet Lombardi was once just like any of us; a mom with a husband and two kids, living on a suburban tree-lined street. The only perhaps slight difference is that she started an extramarital affair and didn’t notice her husband’s surreptitious drug problem that led to his signing massive loans, putting the family in debilitating debt. Oh, and then he went to prison.

But never mind all that.

My point is this: Even though our spouses will probably stay the same, trustworthy creatures we’ve learned to love and annoy, we should all – men and women, husbands and wives – be active participants in our family’s financial affairs, lest we suffer even the slightest of sore fates. You know, like being unable to fund our kids’ college careers (does the spouse steering the financial ship expect the kid to take out loans?) or retiring with a new and unexpected lifestyle (What? You didn’t want to move to rural Arkansas? Well you should have said something years ago.)

Say something.

Lombardi, for her part, cleaned up her financial mess, came back stronger and authored Bankruptcy, a Love Story. Her memoir reveals some juicy stuff as well as some strong principals she created after her experience but wishes she’d followed from the day she said ‘I do.”

First, she wants us to be aware of our finances. Regularly check bank statements and credit reports. Even if one person is in charge of the household’s investing and bill-paying, the other person should know the lay of the land. That includes savings accounts and checking accounts, brokerage accounts, mortgages and – better check – second mortgages, says Lombardi.

Then, she says we should have a plan between the two spouses. It’s a big talk that includes macro and micro goals. Overall, we’ll want to discuss the plans for which we’ll save: retirement, a home, kids’ educations. And the portion of our incomes we’ll use to fund those goals. Then there’s the day-to-day, how we’ll spend our spending money. Lombardi calls it a spending plan, not a budget, because that word conveys restriction and sacrifice.

“Don’t think anyone is going to take care of you,” says Lombardi. “Everyone needs to be aware and act accordingly.”