Brought to you by the Every Dollar App, start budgeting for free today. All righty, today's question comes from Andy N. Delaware. My fiance had a lot of debt related to a prior divorce.
She's currently living with her parents and her parents use a little cash and 10 credit cards to pay off her debt. So now she owes them close to $75,000. I know legally most of this is not in my fiance's name, but morally we owe it together when we get married. I didn't agree with how her mom put this debt on credit cards and it doesn't sound like they are paying much more than the minimums right now.
My plan is to take out a personal loan after we get married to pay off her parents in full. So I have control over the debt completely. This would drop down the interest significantly. We could then attack it with both of our incomes to pay it off as quickly as we can.
Would this work or is there a better plan? Okay, so just to clarify, there was a divorce she had debt. Her parents said, we'll take care of it, but we're doing it with credit cards. And you're like, no, when we get married, we're gonna take out a personal loan and clear it.
I don't necessarily like that method. I like that you're saying, hey, after we get married, then we'll tackle it together. That is right, so green check on that. I would not do the loan.
The truth is you're only on the hook for the $75,000. You're not necessarily on the hook for any interest that is accrued because of their method of paying for this. That part is on them because they chose that route. They chose that card with that interest rate.
Unless there's a conversation that I don't know about. In my mind, I'd be like, I owe you $75,000. Ken? I couldn't agree more.
It's a lot easier. They've already assumed this debt for her. Isn't that something that she put on them? They did this.
I would pay the parents directly. And I agree with Jada, I wouldn't worry about the interest. That's their problem. I think they'll be thrilled that you guys are serious about paying it off.
And I think it's a lot easier to pay them off. Now, I would only say the caveat that that is, you both need to agree. You and your fiance that we aren't skipping this. We're going to treat this like it is a private loan.
Like our credit would be affected. Like come after us with collections. All of the things that people that loan money put in place as some sense of accountability. And I think that's the key or else this could create tension.
And I don't think that's the case here. I think I think this is like, we want to get this out. I love the urgency, love the character and the integrity here. But I agree with Jada 100%.
The parents directly. Here's the problem I do foresee is that he's already noticing, hey, her mom put this on credit cards. And this is him speculating. It doesn't seem like she's making payments.
So or he said something there where you know. You're paying the minimum. So I do foresee a problem of down the line them saying, well, we did this, but the balance has grown. So I do think you need to have some sort of really, really clear conversation about how interest is handled and how that part is not pertaining to you.
And records, records, records. Records, records. I would treat every payment that's sent to the parents. However you choose to do it, I would have that in a journal, a financial record, your bank would easily give you that.
I would do that so that it is tracked. If you have the conversation that Jada is recommending, and I agree, because again, they could do something dumb with all that 75,000 and not pay off the record. But at that point, it might be my problem. And let it be known when Ken and I talk about you having this conversation.
We really mean your wife, not you. You need to stay far from this conversation and let her speak for both of you, because otherwise this could get grisly. Create your free every dollar budget today, the simplest way to budget for your life.