The financial risks of living together before marriage

By Michelle Singletary

An elderly woman came up to me recently and asked whether I still use the term “shacking up.”

“Yes, I do,” I said.

She then lectured me against using a phrase that carries heavy condemnation. It’s a term from back in the day when people meant it to sting as a way to discourage people from living together before marriage.

Her point was that I ought to accept what has become the norm for many people. Say people are cohabitating, she suggested. I appreciated her candor and compassion.

I’m in no position to judge people’s choices. If you’re grown, it’s your life. But whatever word or term I may use, I will continue to caution couples about living together before marriage out of concern for their financial well-being.

Often I hear people say they’ve decided to live together to save on rent. They argue that since they are spending so much time together anyway, why not economize their expenses?

Or, they figure, why not co-mingle their money in joint bank accounts since they are spending together? They get joint credit cards or authorize each other to use their own card. They get cellphone plans together. Co-signing on a car for a credit-challenged significant other, well that’s OK because, after all, they love and trust each other. And you help out the one you love, right?

Some even purchase homes because they’ve been told it’s a wealth-building move.

It has become “no big deal” to mix love and money outside of marriage.

But I want to set aside the debate about whether cohabitating is right or wrong and focus on a key financial point. Are you sliding into a relationship without really considering how difficult it can be to separate your financial commitments when the love is gone?

That’s the question researcher Scott Stanley wants couples to think about. Stanley is a professor at the University of Denver and co-director of the school’s Center for Marital and Family Studies. Along with Howard Markman, also a professor in the university’s psychology department, and other colleagues, Stanley developed the Prevention and Relationship Enhancement Program (PREP).

Recently, I was with Stanley and a number of other researchers from around the country who meet every year to talk about research, policy and programs focused on encouraging healthy marriages and relationships.

During the conference in Oklahoma, we watched a four-minute video from PREP that I think every church and community-based program working with couples ought to show. It’s brilliantly filmed and scripted to make the case for people to slow down and consider the consequences of their choice to cohabitate.

You can find the video on YouTube. Search for “Relationship DUI — are you sure you’re in love?” The concept behind the video is based on extensive relationship research by Stanley, Markman and their colleague, Galena Rhoades, a practicing psychologist and associate professor in the Psychology Department at the University of Denver.

“Out of our research on cohabitation, we have found that people slide through life-altering transitions without seeing at the time that that’s what they are doing,” Stanley said.

Because there is little structure in how people date, they can end up in relationships that in the long haul aren’t suitable. But before they grasp that fact — because they are riding high on their love rather than reason — they’ve had a child or co-mingled their finances or both.

“You realize that while this person is great, they’re not great for you,” the narrator says in the video. “You’d like to break up but uh-oh, you are more locked in than you realize. What about that car loan? How much will it cost to break your cellphone contract? And just imagine how much harder it would be to break up if both your names are on the lease?”

In the case of their finances, couples acting under the influence of a romantic high can establish financial bonds before “they’ve developed a mutual and clear dedication to a future with each other,” Stanley said. “They are giving up options before making a choice.” Referring to research by Norval D. Glenn, Stanley says that’s called “premature entanglement.”

So, what is the better way that may save you some heartache and money?

“Take your time to enjoy one another without doing the things that make it harder to break up,” the narrator says in the video. “Keep your own place. Don’t sign a lease together. Decide to do the things that bring you closer. Don’t slide into the things that lock you in.”

Here’s the bottom line from the video. “Take it slow so you don’t get a DUI — decisions under the influence.”