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Combining finances

blog.mitchjlee.com

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Re: Combining finances

#61

Post by cm2012 »

isbjorn16 wrote: post #43

#4 misses some other cases. My spouse and I are firmly in this category, but we also have different spending habits for sure! They buy a lot of little stuff that I don't see as particularly useful, while I don't buy anything at all for months on end, until I spend a whole hell of a lot all at once. Should be a recipe for disaster, right? Except it isn't. We just accept that this is who we are, and we're comfortable w…

Pretty much every sentence of your comment is true for my wife and I. What's "fair" is whatever everyone is happy with. I can't imagine being upset because my wife spent more money than me in the abstract.

Re: Combining finances

#62

Post by skrebbel »

isbjorn16 wrote: post #43

#4 misses some other cases. My spouse and I are firmly in this category, but we also have different spending habits for sure! They buy a lot of little stuff that I don't see as particularly useful, while I don't buy anything at all for months on end, until I spend a whole hell of a lot all at once. Should be a recipe for disaster, right? Except it isn't. We just accept that this is who we are, and we're comfortable w…

The case #4 missed is "yay we have so much disposable income that really it doesn't matter, and this entire article is academic". That might be common on Bay Area-dominated HN, but not in most of the world, where I suppose this article is targeted at. I guess wealthy people don't need advice on how to combine finances :-)

Personally I find "she spends $4000 a year on stuff I don't see the value of but I'm fine with that" nearly unimaginable. I could only see myself have that attitude if we really had thousands of dollars (or euros, in our case) of net disposable income every month, after retirement savings and everything.

Re: Combining finances

#63

Post by bdowling »

shalmanese wrote: post #58

The flows are the easy part, the stocks are much harder. 1 partner enters the marriage with a $500K paid off house, the other enters with nothing. They divorce 20 years later and the house is appraised at $2.5M, should: A: partner 1 receive $2.5M, partner 2 receive $0? B: partner 1 receive $1.25M, partner 2 receive $1.25M? C: partner 1 receive $1.5M, partner 2 receive $1M? D: other? How does this answer change if the…

The general rule is that property owned prior to a marriage remains the separate property of that owner. So the answer to your first question is generally A.

The answers to your other questions will depend on whether the couple is in a marital property state or a community property state, because the default rules regarding marital income are different.

Re: Combining finances

#64

Post by skrebbel »

rconti wrote: post #57
mercutio2 wrote: post #51

Earlier quoted context omitted.

Amongst my social group your approach is relatively unusual. A sizable fraction of adults can’t be bothered to form a budget and do bookkeeping. This always surprises me, but it seems to be true. You can’t really have an allowance system without some amount of tracking/budgeting. Of course, most couples in my social circle are extremely wealthy by non-Bay Area standards, so that gives people a lot less direct incenti…

"My" approach is just the chip-in. The allowance system is what I ASSUME most people use (the one the article is advocating). I'm surprised the author thinks it's novel. I agree on budgeting and bookkeeping. Frankly, we do neither. I buy a bigass TV because I want it, my wife buys some awesome workout gear because she wants it. It just works. But yes, it's a position of luxury to not have to budget.

FWIW My SO and me are the only people I know who do the allowance thing. My friends routinely talk about "he/she spent so and so much on $USELESS_ITEM, grumble grumble". I say "pocket money!" and they nod and laugh and don't do it because it makes them feel like children.

Re: Combining finances

#65

Post by shoo »

shalmanese wrote: post #58

The flows are the easy part, the stocks are much harder. 1 partner enters the marriage with a $500K paid off house, the other enters with nothing. They divorce 20 years later and the house is appraised at $2.5M, should: A: partner 1 receive $2.5M, partner 2 receive $0? B: partner 1 receive $1.25M, partner 2 receive $1.25M? C: partner 1 receive $1.5M, partner 2 receive $1M? D: other? How does this answer change if the…

similarly, consider one partner entering with $100k of student loans, or $20k of credit card debt.

Re: Combining finances

#66

Post by lukasm »

bdowling wrote: post #63
shalmanese wrote: post #58

The flows are the easy part, the stocks are much harder. 1 partner enters the marriage with a $500K paid off house, the other enters with nothing. They divorce 20 years later and the house is appraised at $2.5M, should: A: partner 1 receive $2.5M, partner 2 receive $0? B: partner 1 receive $1.25M, partner 2 receive $1.25M? C: partner 1 receive $1.5M, partner 2 receive $1M? D: other? How does this answer change if the…

The general rule is that property owned prior to a marriage remains the separate property of that owner. So the answer to your first question is generally A. The answers to your other questions will depend on whether the couple is in a marital property state or a community property state, because the default rules regarding marital income are different.

Not sure why you've been downvoted. This is how it works in my country and I think this makes sense.

Re: Combining finances

#67

Post by roel_v »

lukasm wrote: post #66
bdowling wrote: post #63

Earlier quoted context omitted.

The general rule is that property owned prior to a marriage remains the separate property of that owner. So the answer to your first question is generally A. The answers to your other questions will depend on whether the couple is in a marital property state or a community property state, because the default rules regarding marital income are different.

Not sure why you've been downvoted. This is how it works in my country and I think this makes sense.

Because the topic is not "what's the default legal situation".

Re: Combining finances

#68

Post by mtrimpe »

bdowling wrote: post #63
shalmanese wrote: post #58

The flows are the easy part, the stocks are much harder. 1 partner enters the marriage with a $500K paid off house, the other enters with nothing. They divorce 20 years later and the house is appraised at $2.5M, should: A: partner 1 receive $2.5M, partner 2 receive $0? B: partner 1 receive $1.25M, partner 2 receive $1.25M? C: partner 1 receive $1.5M, partner 2 receive $1M? D: other? How does this answer change if the…

The general rule is that property owned prior to a marriage remains the separate property of that owner. So the answer to your first question is generally A. The answers to your other questions will depend on whether the couple is in a marital property state or a community property state, because the default rules regarding marital income are different.

Yet if you take that view then by sharing in the mortgage payments partner A may have become landlord to partner B and renter’s protection might apply to partner B.

Re: Combining finances

#69

Post by mettamage »

n42 wrote: post #55

My partner is what some might call a trust fund baby. Her family is fortunate enough that she need not work. She will likely receive a sizable inheritance. Her parents have shielded her from their wealth, while making sure she always has enough to be comfortable. Neither of us knows how much wealth her family holds. They are very discrete. I come from a middle class family that spent their money and saved poorly. I t…

My uncle is in a similar situation. Currently he's out of a job and he's being supported by her. He told me he had difficulties with the wealth of his wife when he was younger but the older he got, the more he got comfortable with it. He made me realize how much perspective switching there has to be involved in a situation like his since they both value money differently.

Re: Combining finances

#70

Post by vitoc »

In Prudent, you can combine multiple journals. Your wife can maintain a separate journal while you maintain another one. This way, both parties can do whatever they want or agree to some set of rules. Most importantly, at any time, you or your wife can see the combined financial strength, or individual financial situation. Awareness of both can make a big difference in making important financial decisions. Avoid being penny wise, pound foolish. The combined report (of savings, etc.) gives both of you better insights on the financial journey that you can embark together (i.e. buying a house, having kids, moving cities, etc.)

https://docs.prudent.me/docs/combining

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