As single women, not only do we have to take care of our careers and personal lives, but we also must be very careful of how we deal with our financial lives. Too many single women are getting involved in relationships and lending out money to men they hardly know. Come on, ladies! Does that make any sense? So, here I offer 5 rules to govern your single, female financial lives.
1. Never lend money to a boyfriend you’ve only known for a short time (I.e.2 weeks, one month, you get the point)
“Neither a borrower or a lender be…” Shakespeare could never have been more right when he penned those words. I would have to say that the overwhelming majority of the cases I see on small claims court tv involve unpaid personal loans. People play bank all of the time. We lend friends and family a few dollars here and there, and sometimes those loans reach the level of thousands of dollars. Here is where the trouble starts.
But always get it in writing. Say it 20 times in front of the mirror every morning if you have to in order to make it stick. That is the single biggest mistake that people make. Verbal contracts are fine, but a written promissory note is better. This ensures that both you and the person to whom you loan the money, no matter how long you’ve known them, are speaking the same language. Also, this is important because, if for some reason, you do decide to take them to court, then you have a document to show that you and the other person had an agreement.
Remember to include the amount of money borrowed, the time agreed upon to repay the loan, if the payments are installments, then the amount of the installments, and signatures of all parties involved. If you do not specify this information, you will have a hard time proving the person had defaulted.
In the same manner, be wary of a many who asks for money shortly after you have started dating. You do not know him well enough to give him any of your hard earned money. You cannot believe that you know this person well enough to determine if you will be repaid. However, should you decide to loan money to your significant other, follow the above advice and get the terms in writing should you end up in court.
2. Never get anyone a cell phone in your name
Getting someone a cellular phone in your name has consequences that can follow you for years. By that I mean your credit report. No one wants to have negative marks on their credit report, but if you do not protect it and make wise decisions, then your report may be blemished for years.
If you get someone a contract in your name with the agreement that they will pay you back, get it in writing (are you noticing a theme yet?) But perhaps more important is not to rely on them to pay you. Think about it. If, for some reason, your friend, family member, or whomever, fails to pay you, will you have enough money to make the payments they should have made? If not, then you might want to think twice about agreeing to the phone.
In the case of cellular phones, I know from personal experience how painful the whole experience can be. I got someone a cell phone in my name and the account ended up in collections with a $420 balance. And guess who they expected to pay? Me, not the person who was actually using the phone. That bill became my responsibility.
Now there are a variety of prepaid phones on the market. If your friend’s credit is so bad that they cannot afford the deposit required for a contracted phone, then politely suggest that they get a prepaid phone instead until they can come up with the money and their credit is better. Hopefully that will keep both of you out of court.
3. Never, ever open a joint checking account with someone who is not your husband (that means no boyfriends!)
It happens all the time these days. A man and woman start dating, they seem to get along, and then they do one or both of the following–move in together and/or get a joint checking account.
Premarital cohabitation has become such the norm that I will not even go down that road. However, the practicality of such an arrangement and the complications that follow a break up make it more of a hassle than it is worth.
Now you have two people who may or may not get married living in the same household. They are trying to figure out the best way to pay the bills. Well, naturally they should open a joint checking account and put the sum total of both of their paychecks into the account. Good idea, right? Wrong!
Let’s take a couple of scenarios into account. First, there’s the possibility that one of you makes more than the other. If that is that case, and you are the one making more money, you are giving your boyfriend unlimited access to more money than he would have on his own.
Next scenario: your boyfriend has more debt than you. This might result in him taking out more money than is rightfully his to pay off bills that aren’t yours. That hardly seems fair.
Last scenario, and by far the worst. In this case, your significant other is seriously irresponsible and takes all of the money out of the account. And even if the two of you never move in together, but still open this checking account, the above scenarios are still possible. And if you are not moving in together, I would have to wonder why you are considering opening a joint account anyway.
4. And even if you foolishly open one, never put all of your money in that account
So, let’s say you ignored the previous advice and opened a joint account anyway. Okay, we can deal with that as well. Just make sure that you keep a separate account of your own that only you have access to. If you feel like you have to have that joint account for household bills, then do the adult thing and set up a system where you both know how much each will contribute to the account and who is in charge of paying the bills. But, by all means, keep part of your money for yourself.
5. Never cosign a loan for anyone
I’m talking about car loans, cell phones, anything that will hold you liable if the other person fails to pay. Basically, putting anything in your name for another person because they have bad credit or no credit. In a way, it has a lot to do with the whole idea of getting everything in writing. But, like I said, things like this can affect your credit report for years for something you really didn’t do. You see, when you loan someone money out of your pocket, there is no credit involved. However, financing a car, getting someone a credit card, and things like that, have far reaching consequences.
There are a lot of people with bad credit, but that doesn’t mean that they aren’t responsible for repairing their own credit. Do they really need the car? If so, does it have to be a new car? No, usually not. This is the kind of thought process you need to go through when anyone asks you to cosign for them. It is almost never a good idea and it will come back and bite you in the behind at some point in time.