My (34M) wife (33F) and I recently got married. We live in the US (MCOL), no kids. Before I start, my mindset on debt has been that I am very reluctant to go into it – be it car payments, credit card balances, etc. However, when I met my now wife, she was in the middle of medical school (and racking up $400k in debt). While we were dating, she was adamant about paying it off quickly. We talked about living on my salary while she pays hers down, it seemed like we aligned on not wanting this hanging over our heads.
Fast forward to today. She has been in her career field for 3 years now. Her current loan balance is…$400k. She has made zero progress and has actually gone more into debt with credit cards, while relying on me as an atm. We agree to split rent (as a married couple), but it's become only my responsibility. So how did we get here?
She was on a 10 year plan initially ($4600/mo). That is obviously super aggressive, but at the time she was making $175k and I was making $95k. It was a big hole, big shovel situation. Unfortunately, she very quickly dropped down to a lower payment plan that resulted in her paying over 20 years, with balloon ($9k/mo) payments at the end, and interest-only ($2300/mo) payments to start. The new plan made no sense for mid- to long-term planning, and we had many arguments as to why principal payments weren't being made. She was spending all her excess money, then quit as the job was very stressful and unhealthy (I supported this move). After quitting she ended up going 3 months without pay which ate into her remaining savings.
This new job, while (marginally) easier on her mentally, has resulted in income dropping to $110k per year. She thought the move would be lateral pay-wise with much more room for growth, but that has not been the case. This pay (110k/yr) has been going on for 2 years now. I have insisted that she move on, but at this point it is a confidence thing and she is afraid she cannot get a job anywhere else. Two points I want to mention.
1 – She can get another job. She's had 2 rough employers, but I believe that she can succeed in the field. Her confidence is badly shaken.
2 – To me, she doesn't have a choice but to move on. Average salary in her field is ~$180k. She is far below average.
As for myself, I am a simple saver. I am comfortable putting 50% net away in savings, and am now up to ~$130k salary. It it plenty of money and I don't lack for anything. What I don't understand is why there has been no progress on her end, and I am at my wits end. I also found out 8 months before our wedding that she has had a $10k credit card balance she had been paying the minimum on for nearly 18 months. I wanted to throw up, but she seemed sorry and I gave her the money to pay it off.
Her loan balance is now in a federal forgiveness plan based off income. For those unfamiliar, her payments are based off of her previous years earnings. If she makes payments for 20-25 years, the accrued balance is forgiven (and taxed as income).
My question is this…is this something we can get past? We seem so unaligned on financial habits. I know all the stats about finances being the leading cause of divorce, etc. Has anyone had success getting their SO to change their habits? We don't have kids, we still make a lot of money together. There is zero reason why we can't be kicking butt financially instead of arguing about money once a week. She doesn't have a car payment and pays rent intermittently. She does share the grocery bills. Completely lost on how to proceed as I know this is literally the easiest it will ever be to save money.