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Snapcash, Venmo, Google Wallet and PayPal: Compare P2P money-transferring options

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You may use your card for everything, but it’s not always the most elegant solution. Ever dined out with a large group only to find the restaurant won’t split the bill? Or been the one to cover the bill only to learn how easily people forget their promises to pay you back?

Table of contents

Fortunately, a growing number of apps promise to replicate the process of handing a friend some cash for your share and save bill-footers the hassle of hounding their friends. Some of them even let you use credit cards.

We tried out four popular person-to-person money-transferring services (Snapchat’s Snapcash, Venmo, Google Wallet and PayPal). Read on to decide which is best for you.

Note: Want to send money to someone who doesn’t have these services yet? No problem. Most will let you send the money to an email address or phone number. To get the money, the recipient will follow the prompts to download the service.


How to sign up: Snapcash is integrated into Snapchat (thanks to a partnership with Square). So if you have Snapchat, you have Snapcash.

In the “Settings” menu, find “Snapcash:”

Where to find Snapcash within snapchat

Then just fill in the required fields for linking your card.

How to send money: With a Snapchat conversation open, just type in a dollar sign followed by the amount of money you’d like to send to that friend. For example, if you want to send a dollar, type in “$1″ like so:

Sending snapcash

Because it wouldn’t be Snapchat without an element of fun, you also have the option of typing in three dollar signs (“$$$”) to use the “Make it rain” feature – you’ll swipe your screen with your fingers to simulate sliding dollar bills off a big stack of cash.

I opted for the basic option, and the moment I tapped the green button, my recipient got a notification in the chat window:

Snapcash payment notification2

My recipient hadn’t set up a Square account and linked a card yet, so the money is in Snapcash limbo until he does. If he doesn’t link a card within 24 hours, I’ll get my dollar back.

Can you use a credit card? No. Debit only.

Fees: Snapcash charges no fees for sending or receiving money.


Pros: Sending money is as easy as texting … or whatever else you use Snapchat for.

Cons: Until the recipient moves the money into a bank account, it’s useless; you can’t accrue a Snapcash balance and use it to pay other friends within the app.

Also, to send more than $250 in a seven-day period, you’ll need to verify your identity and provide your Social Security number.


How to sign up: Download the app. If you allow it to do so, Venmo will search your contacts and Facebook profile for other users you know and generate a friends list. Within the “Settings” menu, select “Banks & Cards:”

Setting up Venmo

Then add accounts and cards.

How to send money: From the Home screen, tap the “$” icon and select which friend you’d like to send the money too. Then fill in the amount and what the money is for. I owed my friend a couple bucks for a grocery run, so I filled out the fields accordingly:

Venmo payment screen

My recipient got a notification seconds after I hit “Pay:”

Venmo alert payment received

Can you use a credit card? Yes, for a per-transaction fee.

Fees: None for bank accounts or debit cards; 3 percent fee for credit cards.

Pros: Money sent via Venmo has a life, even if the recipient doesn’t want to deposit it in a bank account. It can stay in Venmo indefinitely and be used to pay other friends.

Cons: Venmo’s default settings are very public:

venmo default settings

That means the people you share money with and the reason you shared the money (if you provide one) will be visible to all your Venmo friends. That’s part of the fun – Venmo bills itself as a social money-sharing app, after all. You might even want to brag you sent someone money for your share of a Vail ski trip or give your friends a laugh: One friend in my feed had sent money to another for “Bad decisions and good memories,” while another had labeled a transaction, “Keep the change, ya filthy animal.” But if you do want to keep things a bit more private, you’ll have to remember to change the settings manually.

You’re also limited to sending only $300 at a time unless you verify your identity.

Google Wallet

How to sign up: Download the app, and sign in using your existing Google account, if you have one. If not, sign up for one. Within the “Settings” menu, select “Credit and debit cards” and link the cards you wish to add. You can adjust the virtual cards’ colors to make them easier to tell apart.

How to send money: You can do this from the home screen:

Sending money with google wallet

Then, select the recipient (you can send to any email address) and fill in the amount. Tap on the card name to the right to change which card you’re using and to display fee information:

Google Wallet transfer screen

As soon as I completed the transaction, my recipient’s phone dinged – an email had arrived, notifying him that he had yet another $1 from me. Recipients can cash out into a bank account, or keep the money in their Google Wallet balance.

Can you use a credit card? Yes, for a per-transaction fee.

Fees: None for debit cards. For credit cards, it’s either 3 percent or $0.30, whichever is higher.

Pros: Google requires you to set a PIN, which must be used before each transfer (it’s the only app we tested that had this as a default security setting). If you give the app use of your camera, you can also photograph your cards to add them to your wallet instead of manually entering all those numbers. The transaction minimum is rather high at $10,000.

For those who would rather not transfer their Google Wallet balance into a bank account, there are plenty of uses for that money (including on Google Play and in store).

Cons: Google Wallet has the highest hurdle for recipients to claim their money. Even for small transactions, recipients must verify their identity, including the last four digits of their Social Security number:
Google Wallet confirm identity


How to sign up: Download the app, and sign into an existing PayPal account if you have one. Create an account if you don’t. Select the “Wallet” icon at the bottom of the screen to add cards and bank accounts. Virtual versions of the cards (and truncated account numbers) will appear in your PayPal wallet.

How to send money: Tap the “Transfer” icon at the bottom of the screen. Fill in the recipient (email address or phone number) and amount. On the next screen, select your various cards from your wallet to see the fees required:
Paypal fee for sending money

The money then rolls right into the recipient’s PayPal balance.

Can you use a credit card? Yes, for a per-transaction fee.

Fees: No fee if you use a bank account or PayPal balance. A fee of 3 percent plus $0.30 per debit or credit card transaction will be charged to the sender.

Pros: PayPal is old and familiar, compared to the other options above, so your intended recipient may be more likely to have it. Like Google Wallet, it allows you to photograph your cards instead of manually entering them. You can send up to $10,000 in a single transaction, if your account is verified (limits vary – and are lower – if the account is not verified).

The biggest advantage PayPal has is flexibility. Funds in your PayPal account have plenty of uses, even if you don’t want to redeem them into a bank account. You can shop at any of the various online outlets that take PayPal, donate to charity, pay other people and even pay in select stores and restaurants.

Cons: Unlike the other apps above, PayPal charges a fee for transferring money with a debit card.

Protect your privacy and security

All of these apps will ask for access to at least some of the following: Your phone’s camera, your contacts and your social media profiles. Giving that access can create a fuller, more streamlined experience, but read carefully before you simply tap “Accept” or “OK.” Venmo, for example, asked incessantly if it could post to my Facebook profile. Take time to read each app’s privacy policy carefully.

Also take advantage of security settings. If you can, set up passwords or PINs for each app (even though not all of them require it), and set a password for your device as well.

Editorial Disclosure: The editorial content on this page is not provided by any bank, credit card issuer, airline or hotel chain, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author's alone, not those of the bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Gifting miles? How to be smart about it

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If you’re looking for a last-minute gift for the nomad on your list, all those airline miles you earned with your card this year might seem like the perfect fit.

More from our 2014 holiday package

But before you give miles, know that it’s not always a good idea. In addition to the costs involved, there are some obstacles that could make your present, while no less thoughtful, a bit less useful.

We asked some travel rewards experts about the smartest ways to give the gift of travel.

Know the costs

If you want to put miles directly into someone’s frequent flier account, you have two options, and neither is a very good value:

1. Buy miles: You can purchase miles directly from the airline. Typically, this will cost you 2 to 3 cents per mile, says Casey Ayers, managing editor of travel website PointsAway and author of “PointsAway: The Definitive Guide to Free Flights & Nights Worldwide.”

For example, American Airlines miles cost 2.9 cents each:

American Airlines buying miles

That means you’re likely paying more for the miles than they’ll be worth when your loved one redeems them.

“Typically, purchasing miles is a poor idea,” Ayers says. “… It’s possible to get more than 2 or 3 cents per mile of value on award tickets in most programs, but typically only on business or first-class international flights, and not on most domestic trips.”

2. Transfer miles you already have: Even though you’ve already earned the miles, the airline won’t just let you give them away for free. The cost of transferring miles from your account is typically between 1 and 1.5 cents, according to Ayers. American Airlines, for example, charges 1.2 cents per transferred mile:

American airlines sharing miles

While buying miles or paying to transfer your own generally won’t yield a great value, it can still sometimes make sense to do so, says Tiffany Funk of reward travel booking company PointsPros.

If, for example, you know your recipient is just 5,000 miles away from getting a reward flight for their dream trip, topping off their balance might make sense.

Look for purchasing/transferring promotions

Airlines sometimes run limited-time bonuses for purchase miles. Both Funk and Ayers cite US Airways, which has been known to offer 100 percent bonuses on purchased. With a deal like that, gifting miles can be much more justifiable.

Allow for delays

Whether you’re buying miles or transferring your own to a loved one, don’t do so speculatively, Funk warns, as reward space is too volatile.Gifting miles_Funk

Say your loved one dreams of going to Paris during spring break. You see that there’s a reward seat for 40,000 miles, so you buy or transfer that many points to the lucky recipient. However, it can take time for those miles to show up in his or her account (how long depends on the airline). In those several days, the reward seat might be gone – or require many more miles. If the destination is trendy (South Africa is particularly hot right now, Funk says), expect reward space to be elusive.

“Reward availability changes really rapidly,” Funk says. “And that can be frustrating. We have a lot of clients who are like, ‘I just bought all of these Delta miles, they were running this promotion, and I wanted to use them on this flight and when I went to book, the flights were gone!’”

You can prevent this if the airline allows holds on reward seats, Funk says. That way, the gift recipient can go through the booking process on the desired reward seat and put it on hold. Once the miles are deposited, they can book. Whether this is possible (and how long the hold lasts) varies by airline.

There’s an easier way

Don’t let the caveats above dissuade you from giving the gift of travel this season. If you’re considering transferring miles you’ve already earned, there’s a simple work-around: You can book a ticket for anyone using your own miles – no need to transfer.

“If you have the miles, simply booking a ticket for a recipient instead of sending miles their way can be a more effective option,” Ayers says.

So consider saving the cost and the hassle by giving your loved one a card and telling them to name a date and the destination. Then book the trip yourself with your own miles when the time comes.Gifting miles_Ayers

“It amazes me how many people don’t know they can do this,” Funk says. She once worked with a client who paid $5,000 to transfer miles into his granddaughter’s account, not knowing he could have booked the trip from his own account for no transfer fee.

Consider last-minute deals

If you’d like to give your gift a bit early, know that the holidays are a good time to snag last-minute reward seats, Funk says.

“There can be great things last minute,” Funk says. “Some airlines are really good about looking at their flight load a week before departure and realizing they didn’t sell all the seats they thought they were going to for Christmas. So they might put some of them up as rewards seats.”

Editorial Disclosure: The editorial content on this page is not provided by any bank, credit card issuer, airline or hotel chain, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author's alone, not those of the bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

3 card benefits you might not use as much as you thought

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Credit cards sport an array of perks to entice applicants, from lounge access to price protection. And there’s a good reason for this, according to 2013 research from J.D. Power — customers who make use of their card’s benefits spend, on average, $400 more per month on the card, compared with those who don’t.

Yet the exciting-sounding perk that got you to apply for a card may be one you never use – or that you find cumbersome to use. The perks below may be a nice touch, but don’t make your credit card decision based on them.

1. Lounge access

airport loungeCards that have it: Platinum Card from American Express (a CreditCardForum advertising partner), the Citi Prestige, the Citi AAdvantage Executive card, the United MileagePlus Club card the Delta Reserve.

Why it seems like a good idea: Although lounge access is indispensable for many road-warrior business travelers, frequent recreational travelers might find themselves intrigued as well. After all, who wouldn’t want access to a quiet sanctuary, especially when you have to arrive at the airport so early these days?

Why you might not use it after all

  • Lounge location: Consider the airport you usually fly out of. The lounge your card allows you to access might be in a different terminal from the one you’re flying out of. In some airports, that means a long ride on the airport shuttle train or even an extra security screening. Some lounges (such as American Express’s Centurion lounge at LaGuardia) may also be located pre-security, an inconvenience for anyone who wants to relax in the lounge until right before boarding.
  • Short layovers: Many domestic travelers choose itineraries that minimize layovers – you don’t want a five-hour layover in DFW on your way to Chicago if you can avoid it. That means you might not have much lounge time, especially if your layover is shortened further by a flight delay (because of course it is) or if the lounge is in another terminal (see above).
  • Traveling with family: Remember, lounge access was designed for solo business travelers. Issuers are getting less generous about allowing cardholders to extend their complimentary lounge access to guests, so expect to pay a cover charge for family members or travel buddies.

2. Price protection

This benefit promises to refund you the difference if an item you bought with the card goes on sign

Cards that have it: Various cards from Citi (the benefit is called Price Rewind), Chase Freedom, Chase Sapphire Preferred.

Why it seems like a good idea: Who hasn’t had the frustrating experience of buying something only to see it go on sale the next day?

Why you might not use it after all: This perk comes with a lot of fine print. You’ll need to save the receipt (and possibly other documentation), the price must fall within 60 days (Citi) or 90 days (Chase), there are limitations for going-out-of-business sales, and a variety of items are restricted (including jewelry, refurbished items, items purchased outside the U.S. and tickets). Plus, while Citi lets you register your item (and tracks online price fluctuations for you), Chase requires you to scan prices yourself. In both cases, you’ll be required to provide requested documentation and fill out a claim form.

As you can see, this benefit requires you to keep track of paperwork and do some research that’s probably worthwhile only for big-ticket items that drop drastically in price. If the shoes you bought decrease in price by $10, the process may not be worth it.

3. Concierge service

This benefit lets you call a number to offload research tasks onto a concierge.

Cards that have it: Many cards have this benefit, including no-annual-fee cards.concierge service desk

Why it seems like a good idea: You’re busy, and you like the idea of having someone else make restaurant reservations, find you a hotel, hunt down a store that sells a hard-to-find item, or make alternate travel plans if your flight is delayed.

Why you might not use it after all: Quality varies among cards’ concierge services, and there are also limits to how far a concierge will go to help you. Plus, the concierge will need time to take care of your task (sometimes several days). Most importantly, though, you likely already have a concierge in your pocket – a smartphone capable of comparing prices, scouting out travel options and conducting research. Ask yourself: Are you more likely to hunt down your card’s concierge number, wait on hold and explain your problem to a stranger? Or pull out your phone and start Googling?

So what should you look for?

The perks above may in fact be very important to you. Just make sure you’ll use them enough to justify any annual fees. If you then find yourself with a card full of perks you’re not using, your issuer may allow you to downgrade to a card with fewer frills — and a lower annual fee.

Looking for benefits and perks that nearly everyone will find useful? Use our credit card matchmaker chart as a place to start. In general, a card with an easy-to-use rewards system will put money back in your pocket and may even pay for an annual fee. If you’re a frequent traveler, also look into the travel protections and rental car insurance your card offers. These benefits generally don’t require you to sign up -– you just need to book the travel with the card for automatic coverage.

Tell us in the comments: Were you excited about a particular perk, only to never use it? Are the perks listed above ones you actually use all the time?

Editorial Disclosure: The editorial content on this page is not provided by any bank, credit card issuer, airline or hotel chain, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author's alone, not those of the bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Most common questions about credit utilization, answered

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Credit utilization (the amount of credit you’re using compared to the amount of credit you have available) is important, to be sure. In fact, it’s the second-most important aspect of your FICO score, the credit score most often used by lenders: On the chart below (from FICO’s website), utilization is represented by the “amounts owed” slice of the pie.FICO components pie chart utillization

But before you start fixating on utilization, make sure you’re not falling for any myths – and that you’re not wasting any effort. We asked FICO Spokesman Anthony Sprauve some of the most common questions that come up in our forum about utilization.

What’s the ideal credit utilization percentage?

Calculating credit utilization is simple: Just divide the amount of credit you’re using by the amount you have available. If, for example, you have $1,000 in credit and are using $500 of it, your utilization is at 50 percent.

But if you start researching what the ideal credit utilization is, the numbers go haywire. You’ll see 30 percent quoted often as the line you don’t want to pass. Other sources recommend staying under 10 percent.

FICO itself emphasizes the 30 percent ceiling, Sprauve says, but the lower, the better.

“Thirty percent is what we quote because that’s what’s most realistic for people to maintain,” he says. “You’ll get good marks at 30 percent, better marks at 20 percent and even better marks at 10 percent. But you’ll do just fine at 30 percent.”

What if your overall utilization is low, but you’re maxing out one card?

Let’s say you’re maintaining a nice, safe 30 percent utilization across all your cards but nearing the limit on one of them.

More about FICO scores

If so, you’ll be penalized in FICO’s scoring model, Sprauve says, because it looks at utilization across your cards and on a per-card basis.

“Maybe your overall utilization looks good, but if you have one account where you’re above that 30 percent threshold, you’ll get dinged for that one account,” he says.

Will past high utilization hurt you if you pay your balance down to zero?

Say your credit utilization has been high for years, but you recently wiped out all your debt. Do you have a clean slate as far as utilization goes?

A long history of negative behavior (including high utilization) won’t put you on equal FICO footing with someone who has always carried low balances, according to Sprauve. At least not right away.

“If you have a history of keeping your balances low and doing all the right things, you’re going to have a better score than someone who has had high balances in the past and struggled with keeping their balances down,” Sprauve says.

The good news: “The further in the rearview mirror negative things like high balances are, the less impact they have on your score,” Sprauve says.

How do charge cards factor into utilization?

Some cards, such as charge cards, don’t have credit limits. In exchange for more charging flexibility, you must pay in full every month. Such cards are ignored by the utilization aspect of FICO’s model.

“If you have an account like that, it does not count into utilization,” Sprauve says. “Utilization is looking at revolving credit.”

Some cards, though are less clear-cut, boasting “no pre-set spending limit.” You have an official limit, but you’re allowed to exceed it in certain circumstances. Whether those cards are factored into utilization, “really depends on how the credit card company is actually reporting the card to the credit bureaus,” Sprauve says. “And while they are telling the consumer one thing, they may be reporting it differently.”Credit limit on credit report

The only way to be sure is to check your credit reports. In the details for that card, check to see if a credit limit is reported (see the example from an Experian report on the right).

“If you look at your credit report and the card is reporting with a limit, it’s being included in utilization, and if it’s not being reported with a limit, it’s not being included in utilization,” Sprauve says.

When is the balance reported to the bureaus?

Your utilization is determined by the balance your issuer reports to the credit bureaus. The question is when, exactly, your balance is being reported. Many consumers may assume that the balance on their statement is what reports, but Sprauve warns that isn’t necessarily true — and that can be a problem if you’re using a particular card a lot and running up high balances.

“If they’re reporting when your balance is really high, your utilization is going to look really high, even if you pay the card off every month,” says Sprauve.

Sprauve therefore recommends paying the card off halfway through the month, continuing to use the card and then making another payment when you get your statement. Or you might set up an alert to notify you when your balance hits, say, 25 percent of your credit limit and make a payment at that point.

“Rather than going crazy trying to figure out when a card is reporting, if you’re using the card a lot, just get into the habit of paying off the balance more than once throughout the month,” Sprauve says.

Editorial Disclosure: The editorial content on this page is not provided by any bank, credit card issuer, airline or hotel chain, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author's alone, not those of the bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Credit for newlyweds: Combine, or keep it separate?

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Depending on when you get married, you may already have a well-established credit life – or none at all. So do you need to hurry to merge your credit life with your spouse’s? And is it OK to maintain some separation?

“When it comes to credit, newlyweds need to start by treading lightly,” says Kelley Long, CPA, financial planner and member of the National CPA Financial Literacy Commission. “Don’t jump into combining your credit before at least taking a look at a few things.”gold wedding rings

How marriage merges your credit

After you’re married, you and your spouse will still have individual credit reports and scores. But once you open joint cards or apply for loans together, your credit lives can become entangled in the following ways:

  1. Joint accounts: Shared credit obligations (joint credit card accounts and joint/co-signed loans) become the responsibility of both parties; any late payments and delinquencies show up on both credit reports.

    Shared accounts can also intertwine your credit in more unexpected ways. Long, for example, took out a mortgage with her ex-husband. Today, that account is closed. Yet, because her ex-husband set up mail forwarding from the address they once shared, his subsequent addresses have popped up on Long’s credit report – and sometimes in credit-report-based security questions.

    “It screws up things when you apply for credit and they ask you questions like ‘Which of these streets have you lived on?’” Long says. “If I say none, but one of them was one of his streets, I fail [the security test.]”

  2. Authorized-user ties: Whether an account disappears from your report after you’ve been removed as an authorized user varies by credit bureau. In some cases, if you aren’t proactive, that account can linger.
  3. Shared debt: In community property states (Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin), debt undertaken by either party during the marriage is divided in half upon divorce. Even in states without such laws, debt will likely be divided up by the judge in the event of the divorce.

Should you combine credit cards?

Just because you’re combining lives doesn’t necessarily mean newlyweds have to rush to combine credit cards.

“It’s about finding a way to merge your finances and being practical,” says Elle Martinez, owner and editor of the website Couple Money and host of the podcast of the same name. “I would say the eventual goal is to have joint accounts. But the realistic way you have to look at it is, ‘Where are we starting out now?’ ”

Sharing credit cards does have perks for married couples, Long says. You can double your rewards-earning power, and it’s simply more convenient.

“You don’t have to say, ‘I paid for groceries last time, and now it’s your turn,’ ” Long says.

However, shared responsibility can unintentionally lead to divided attention.

“When you have two people using a card when they need to use it, you can quickly run out of money to pay it off,” Long says. “If, as partners, you don’t have a lot of discipline in keeping track of those things, you might shy away from having a joint card for everyday spending.”

Even if you do share a card or two, it can be smart for each spouse to have a card of his or her own – similar to how members of a couple might have a certain amount of “fun money” to spend as they like.

“There are always going to be expenses that aren’t going to hurt your budget,” Martinez says. “They’re your little things. My husband is someone who will save up for electronics, while I’m more about experiences like weekend trips with the girls.”

Just keep your spouse in the loop, Martinez says. Even your name is the only one on the account, you owe your spouse regular updates about the balance and payments.

If you do want to merge cards, you have two main choices: joint accounts (where responsibility is shared) or authorized-user scenarios (where only the main account holder is responsible for payments).

So which is better?

If one spouse has a useful, long-standing card with good rewards, consider adding the other spouse as an authorized user, Martinez recommends. If not, consider opening a new account together that has a good rewards program.

Before you open any new cards as a couple, though, make sure you discuss any debt on the pre-marital cards.

“You may find out your husband-to-be has $5,000 in credit card debt and is just making the minimum payments,” Martinez says. “So maybe you decide to pay off that debt together before you open a joint card.”

Loans lead to bigger questions

Mortgages and auto loans are more complicated than credit cards. For one thing, they’re often for large amounts of money and are paid off over many years. FICO score and mortgage rate Dec 2014For another, one spouse with poor credit can derail the chances of getting the best interest rate, resulting in thousands more paid over the loan’s duration. Just look at the estimated APRs for a 30-year fixed mortgage, based on FICO score range, to the right.

So should the spouse with good credit apply alone?

Martinez says no.

One person carrying entire credit load can lead to resentment, she says. Plus, one spouse’s low credit score should give the couple pause before they embark on huge credit commitments.

“Get both of your credit situations under control before you start talking about loans,” Martinez says. “If you have a partner who has a problem with keeping up with credit obligations, a loan is going to add more headaches. Just the process of going for a mortgage will require both people to be on top of things.”

But what if your car breaks down and you need a new one right away? Martinez suggests going for a smaller, joint loan (and paying a larger down payment).

“I would go with a smaller loan rather than having just one person on the hook,” Martinez says.

Long, meanwhile, takes a different approach when it comes to mortgages.

“In the long run, there’s no way to avoid combining your stuff with your spouse,” Long says. “But, from a practical perspective, when you’re first starting out, you might want to keep things separate until you’re both on equal credit footing.”

So, if one spouse has better credit and can snag a better rate by applying alone, they should go for it if the goal is to own a house as soon as possible.

“Before you go all in together, just go with the person who has good credit and see what you get,” she says. “If you keep everything in that person’s name and allow the other person time to repair their credit, you can eventually apply for something together.”

The downside is that you won’t be able to include the other spouse’s income in the loan application. Although that likely means you won’t be able to get as big of a mortgage, that’s preferable to getting a larger loan with a higher interest rate, Long says.

As for one partner resenting the other, she says, couples should know that, in the event of a divorce, the debt would likely be divvied up by the judge – so the person whose name is on the loan wouldn’t likely be saddled with all of it. To ease any remaining misgivings, “have a very frank and honest talk,” Long says. “Make sure you both understand that it’s a joint responsibility, even though the bills are coming only in one person’s name.”

Because auto loans are generally shorter in duration than mortgages and for smaller amounts, couples have less to lose by going in together, Long says. If one person has bad credit and needs a car, it may make sense for the partner with good credit to co-sign the loan.

How to work it out

What works for one couple won’t work for another – and may not even work for you over the course of your entire marriage. If something isn’t working, Long suggests, give it six months and reassess.

“Don’t let anybody tell you, ‘If you don’t combine everything, your relationship is not going to last,’” Long says. “It’s perfectly fine to start out separate and work your way in to a more combined credit relationship. Just like you start out with your lives separate and slowly work them together.”

The first step in determining a credit strategy, Long says, is to pull both parties’ reports and go over everything on them. Because talking about credit can be intimidating for many, Martinez suggests keeping the first credit talk low-key.

“You don’t have to jump into all the numbers right away,” she says. “… I think a lot of people dread having that first money talk because they make it such a huge deal.”

While couples may designate one person as the “point person” when it comes to managing credit, it’s necessary to have regular brief talks (or, as Martinez calls them, “money dates”) to make sure both parties are equally engaged and informed.

“Having a regular money chat takes the pressure off the point person,” she says. “It keeps both people accountable and protects both parties.”

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