How to Take Over the Family Finances When a Spouse Gives Up

Most married couples, for the sake of convenience, have one spouse handling the majority of the bill payment duties. From balancing the check book to deciding upon investments, that one person is generally responsible for updating the other spouse on the financial health of the household regularly. But what happens when you find out that your spouse wasn't as responsible as you thought? What about when they wait too long to ask you for help?

With a recession always looming and the economy taking a downward spiral, more and more marriages are crumbling under the pressure to maintain a certain appearance. That same pressure exists between spouses living under the same roof, with one hoping to keep the other unaware of the troubles they are facing. If your spouse comes to you with devastating financial news, they're looking for help. If asked to take command, or if you simply feel that an intervention is necessary, consider the following steps outlining how to take over the family finances when a spouse gives up. If you've never handled the family budget before, these steps will have you on your way to successfully taking the reigns in no time.

Step #1: Dig out the dirt. There's likely a great deal of information that you'll have to brace yourself for. Don't take for granted that anything is up to date. From the mortgage to the utility bill to your kid's braces, make sure you have all recent receipts and bills in your hand. It may be difficult for your spouse to be completely honest.

Step #2: Count the cash....disposable or not. By now you've probably come to the realization that someone is on the verge of repossessing the car, the jewelry, and the family dog. Welcome to the current way of life for the average American family. It's time for some serious liquidation of the assets, if there are any to be liquidated, for the sake of keeping the basics. From household goods to emergency savings, count up everything that can be used to pay off debt and stabilize the family's finances, and list each item as either being liquid or not.

Step #3: Calculate the total amount of all past due bills and debts. This is where a little prioritizing comes in to play. Write down each bill that is past due, and then organize these emergencies in order of importance. For example, the house payment is more important than the credit card bill.

Step #4: Write down what you must pay for, and what may have to be let go. It's not something we want to think about, and most financial gurus would cringe at this advice, but those of us living in the real world right now understand that, if you are currently living paycheck to paycheck, sometimes surviving is a matter of taking your losses. During a time when we're being advised to downsize our homes, not a soul is looking to buy one. When we're being told to use coupons and cut back on our grocery bill, the pantry is already as bare as it can get. Think of the necessities here. A home, a car to get to work in, utilities, and food are your basics. Any debts and anticipated costs associated with these necessities must come before all else.

Step #5: Negotiate everything for more time. If a job loss or a substantial hit to your monthly income has been taken, time is crucial. Call every creditor you have and work out the best plan possible for short term relief. Most companies offer such plans in the event of an emergency. Also, check the fine print of your credit card statements to see if you've been paying a small fee each month for a protection plan. Many card companies today charge minimal fees that enroll customers in such plans from the beginning of the contract agreement (these plans will sometimes cover the minimum monthly fees for several months during a bout of unemployment).

Step #6: Prepare to say farewell. That is, to your assets, cash, and maybe even that perfect credit score. If you're one of the many Americans whose spouses have just informed them that all savings have been lost and a job has been downsized, you're in for a reality check. Brace yourself and be willing to be cutthroat in order to maintain those aforementioned necessities.

Step #7: Once you have liquidated what you can (and what you feel you should), it's time to allocate and organize. Allocate what you have to emergency past due bills that are not negotiable and are absolutely necessary, and then organize a system and a plan for paying the rest. If you are just holding tight until another job comes into the picture, center your plan around holding off what bills you can while keeping enough set aside to pay the rest for several months.

Step #8: Remember that this is temporary, and begin planning your family finances out for the next several years. If you are taking over the family finances after your spouse has given up on surviving the economic downturn, you'll have to work toward setting brand new goals. That means planning now for possibly downsizing your lifestyle before moving back up.

Finally, when taking over the family finances for a spouse who previously held all control, try not to concentrate on finger pointing. Families are facing enough without turning against each other, and you may find yourself having to ask for help one day as well. With current economic affairs as they are, no one is completely safe. Organize, strategize, liquidate reasonably, and start again. If your family survives as a unit, the most important task will be taken care of.