Financial Empowerment and Mindfulness (Inventory Your Cards and Monitor Your Credit Scores)
Maintain a complete and current inventory of your family credit cards and key credit metrics (e.g. limits, rates, minimum payments, due dates, etc.). Good Credit empowers couples to efficiently tackle a broad range of challenging and stressful family matters including: emergency travel, an unexpected layoff or seasonal slowdown in self-employment, an accident, a death in the family, divorce proceeding or separation, teens and college age kids with credit cards.
Best Practices for Couples
Each marital spouse should have a credit profile (systematically built over time), and maintained and in good standing.
- Scores should be monitored;
- Problems immediately addressed, if any are identified;
- Strongly consider using a subscription-based identity protection, credit card monitoring, and password protection service (e.g. LifeLock);
Credit card, credit card numbers, user names and passwords should be stored securely;
- Locked file cabinet or home safe;
- If stored electronically, the file should be encrypted and password protected
- This information should never be written down, printed, or stored in paper files.
Review the monthly bills or at the very list keep track your family’s overall balance, minimum payment obligation, and periodic interest rate.
Order and review your credit reports once every 12-18 months from the three major credit reporting agencies (Equifax, Transunion, and Experian).
DIVORCE RELATED TIP
At the beginning of a divorce action and during its pendency, understanding the mechanics of your existing credit accounts is key to protecting both your emergency funds, your long-term credit score, and your financial health. It is critical to know who to call, who can access the accounts, and who is financial responsible for each account.
[The advanced check list illustrates the level of detail that begins to be explored when prepping in a divorce proceeding]
Inventory and Key Metrics
How many credit cards are issued to you, your spouse, and your children?
Create an inventory of all cards (e.g. Issuer, Number, Code, Expiration)?
List the primary account holders?
List the authorized users on the accounts?
Know the card limits?
Track the balances?
Track the applicable interest rates?
Do you have small store credit cards, such as J. Crew or Saks?
Review / Process
Do you review the monthly credit card statements?
Who pays the credit card bills?
Do you pay the minimum due or another amount?
Who decides how much will be paid each month?
Why do you use one card over another card?
The Big Picture
Research and understand why a credit score is important and what kind transactions and behaviors impact your score?
How does your outstanding credit card debt impact your credit score?
How do late payments impact your score?
How does having available/open credit impact your credit score?
What is the difference between a hard and soft inquiry into your credit score?
Attorney Melissa Needle is a lifetime resident of Connecticut. She was born in New Haven and raised in Fairfield. Her family has deep roots in Connecticut and she is a third-generation attorney. Since her admission to the bar in 1990, Ms. Needle has practiced matrimonial law exclusively.