Dear Dr. Don,
I found out that my husband did a few cash advances through his credit card over the past few months, paying a $5 fee for each advance. The advances totaled a few hundred dollars. During that time, he only paid down part of his balance. I was snooping around his office when I found the credit card statements.
The good news is that our only debt outstanding is our mortgage. We've paid off our car loan, his student loan and the loan on the TV/entertainment center. So now we each have a few hundred dollars free each month. I also noticed that he finally paid off his credit card balance.
The issue is that he never mentioned that he did those advances, even though I've asked him how he is doing money-wise when we bought some items. He always said he had enough money. Now that we have no more debt, he shouldn't need the cash advances any more.
Should I approach him on this matter? He may not like it that I found out by snooping and he is sensitive about money issues. I don't want to sound condescending, but I don't want to worry about it either or find out later he got into more trouble. Or should I let it go and see if it happens again? He shouldn't have any excuses anymore for the advances since he has more money freed up.
-- Worried Wife
Dear Worried,
You should probably be writing to Carolyn Hax instead of "Ask Dr. Don" because what you really need is relationship advice, not financial advice. On the relationship side, you have to ask yourself why you feel the need to snoop on your husband. Is it a prevent-defense or are you looking for proof of some marital transgression?
It was wrong of you to snoop into his finances by going through his office and reviewing his credit card statements. How would you react if you caught him going through your bills? I'm not sure how you'll finesse the issue of your snooping if you try to get your husband to change his behavior and stop using cash advances as a source of short-term funds.
Cash advances on a credit card are a financial warning sign that the cardholder isn't able to live within his means. Besides the $5 fee, the interest rate charged on the advance often is higher than the interest rate charged on purchases. Credit card providers see a cash advance as a sign that the cardholder isn't doing a good job in managing credit. That can lead to higher interest rates on the credit card based on the card issuer's perception of increased risk.
Married couples don't share a credit report, but rather have individual reports. It's the joint accounts that show up on both credit reports. If you have joint accounts, his credit behavior could impact the interest rates on your credit cards, too.
It's important to note, however, that in community property states, all financial obligations undertaken by one spouse during a marriage become financial obligations of both spouses. In these states, each spouse's credit report would reflect those joint obligations.
Couples have different ways of managing their finances. Some keep separate accounts, some hold their money in joint accounts, and others have both individual accounts and a joint account -- using the joint account to pay the household bills.
The only time it raises a red flag with me is if one partner feels that "what's yours is mine" and "what's mine is mine." From how you've described the situation, you've got some degree of separation in your household finances, yet you want him accountable for how he chooses to fund his spending.
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