Image: Couple Arguing © Con Tanasiuk Design Pics-Corbis

Related topics: debt, financial planning, love and money, Liz Weston, marriage

Jennifer tried to work things out with her spouse, a compulsive spender. They experimented with joint accounts, separate accounts and an allowance system in which each got a weekly infusion of "no questions asked" spending money.

But Jennifer's husband kept overspending, and he sulked when she reminded him that they were trying to save for a house. One of the last straws: He decided he "needed" a new $40,000 car, and he stopped speaking to her when she pointed out that the vehicle cost twice his annual income.

After four years, Jennifer gave up and filed for divorce.

"I should not have let it go as long as I did," said Jennifer, a financial professional in her mid-30s. "I should not have let myself be emotionally bullied."

Others hang in there longer, sometimes to their regret. One message board poster, who had been married 29 years at the time, recounted how she refinanced a mortgage to pay off $45,000 in credit card debt her husband secretly had incurred.

"I just found out (that) 4 years later, he has run up his credit cards again to $36,000 and can't help me pay taxes or any emergency expenses that come along. I am sooooo mad, frustrated, and resentful of him I can hardly stand it," poster "purse" wrote. "We are at retirement age and he doesn't have ANY money saved. . . . The sad thing is I never saw anything new to indicate he was spending. He was supposed to cut up his credit cards after the refinance . . . I just feel so betrayed."

Can this financial marriage be saved?

Few couples are on exactly the same page when it comes to money. Smoothing out the conflicts takes work but usually can be done with communication, compassion and commitment.

Image: Liz Weston

Liz Weston

Some partners are so far over the edge, however, that their destructive habits can sabotage the family finances.

How can you tell whether your partner just needs a little persuading or is a total financial basket case?

You're facing an uphill battle if:

  • There's an underlying addiction. If your partner has problems with alcohol, drugs or gambling, he or she literally can't think straight. Financial progress takes a back seat to feeding the addiction. Recovery is always possible, of course, but you'd be smart to get counseling (even if your partner won't go) and attend a support group such as Al-Anon, Nar-Anon or Gam-Anon.
  • There's a mental disorder. Overspending can be a symptom of a number of mental illnesses, including depression, bipolar disorder and attention-deficit disorder. Again, progress is possible, but the underlying disorder must first be properly diagnosed and treated.
  • There's no acknowledgment of the problem. This may be the hardest nut to crack. Your partner either doesn't see what you're worried about or blames the problem on you. Counseling and sessions with a financial planner may help, but if your partner takes no responsibility and instead blames others, prospects for improvement may be dim.

How to protect yourself

Many people try to insulate themselves from an overspending spouse by keeping separate accounts, but there's a big danger in that: You can't see what he or she is up to. Separate accounts can allow profligate partners to run up big, secret debts.

In any case, simply setting up separate accounts while you're still married may not protect you from your spouse's financial missteps.

In community-property states -- Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin -- debts incurred during marriage are typically considered joint debts.

In other states, debts can be considered joint if they were incurred for family necessities, such as food or shelter. Even when a debt is the sole responsibility of one partner, some states allow creditors to go after jointly owned property if the debt is not paid.

You can get an idea of your liability, and what you can do to protect yourself, by talking to an experienced bankruptcy attorney who knows your state's laws. You may be able to legally wall yourself off from your spouse's debts, even in community-property states, through a document known as a postnuptial agreement. Or you may decide to divorce rather than incur further liability.

Hard but not necessarily impossible

For most couples, though, the picture isn't nearly so bleak. Even those with drastically different money skills and approaches can find a compromise that works.

One message board poster "llbigwave" knew he was in trouble from the start. The first time he tried to call his future wife for a date, her phone service had been disconnected for nonpayment. By the time they married, he had paid off $40,000 of her debt and bought her a used car. Marriage didn't instantly transform her: llbigwave reported confiscating her credit cards twice.