Does Marriage Affect Credit Score?

Marriage can be one of the most significant and wonderful stages two people can come across in a relationship. But it also combines your money lives, which can complicate things financially. This leads many newlyweds to ask a question – does marriage affect your credit score? The short answer is that just getting married does not affect your credit score in the first place. However, some potential indirect effects can impact your credit over time once you are married.

How Credit Scores Are Calculated?

First, let us consider what factors into the determination of a credit score. FICO and VantageScore are two types of credit scores that are widely used in the market. While the exact formulas are proprietary, both companies use similar factors to compute your three-digit number.

• It is the ability to pay bills and other debts promptly. This is usually the largest component of your FICO score contributing to 35% of it.
• Credit utilization – The proportion of amounts owed on credit cards to the total credit available. You should, therefore, ensure that you do not use more than 30% of your total credit since this can have adverse effects on your scores.
• Credit history length – The length of the credit history of the consumer. The newer your history is the fewer chances you have of getting a good score.
• Credit mix – This depends on your record in handling different types of credit accounts such as credit cards, installment credit, mortgages, etc.
• New Credit – opening many new accounts in a short time may be a sign of higher risk and can lower your scores.

As you can notice, the identity of your spouse has no bearing on any of these categories. Therefore, saying “I do” will not alter your credit. That being said, marriage might influence some of those areas to some extent.

How Marriage Can Affect Your Credit Not Directly?

Here are a few ways entering marital life can shape your credit with your spouse over time.

Joint Accounts Holding joint accounts such as joint credit cards or joint loans means that positive or negative behaviors regarding spending and payment can affect both partners and the scores. Ensure that both of you are responsible when it comes to credit card usage of the joint accounts that you have.

Authorized User Status Including your spouse in your credit card account as an authorized user, gives them the privileges of your good credit record and your credit limit. Generally, as long as you keep on using that card responsibly, it improves the scores of the authorized users.

Life Events Some of the significant life changes, such as having children, purchasing a home, or changing careers, occur after marriage. Such results provoke new financial decisions that can create credit using Mix or extend accounts with new credit checks. But they also bring the possibility of hitches emanating from on-time payments that were not planned for correctly.

Shared Liabilities Any loans or accounts that are taken in conjunction with your spouse means that you are both liable for its repayment. Not paying such common expenses is damaging for both – credit scores, and the credit of the main applicant.

The Management of Credit for Newlywed Couples

Although formal union per se does not speak to your credit score, it does link your financial lives and credit references to your spouse. Here are some tips for newlyweds to actively manage your credit as your relationship progresses.

• It is important to consider credit health before getting married so that this aspect isn’t a shock to either party.
• Focus on the systematic and unsystematic expenditure that one is likely to encounter several months or years after the wedding.
• Keep your credit card balances small in proportion to your credit limits and pay off your balances in their entirety to prevent accruing too much credit card debt.
• Increase your scores together by applying for another account as an authorized user or obtaining a joint credit account.
• Follow both your and your partner’s scores regularly to keep an eye on them for any problems.

If both partners are responsible for their own and their spouse’s credit lines, marriage can be a great chance to improve one’s credit history and increase credit scores over time. The act of marrying will not in and of itself cause your rating to soar or plummet. But what happens to the two of you in terms of handling your joint resources after coming together in marriage truly can.

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