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Combining finances

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Re: Combining finances

#81

Post by jfk13 »

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.

> The general rule is that property owned prior to a marriage remains the separate property of that owner.

Well, that's one possible rule; it's not the only/universal one.

(As a traditional ceremony might say, "with all my worldly goods I thee endow". That doesn't sound much like maintaining separate property...)

Re: Combining finances

#82

Post by theelous3 »

jfk13 wrote: post #81
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.

> The general rule is that property owned prior to a marriage remains the separate property of that owner. Well, that's one possible rule; it's not the only/universal one. (As a traditional ceremony might say, "with all my worldly goods I thee endow". That doesn't sound much like maintaining separate property...)

Traditional ceremonies aren't contracts.

Re: Combining finances

#83

Post by zimablue »

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…

Effectively you're under their families power, being "discreet" and doling out money adhoc I wouldn't view as positive, it's them maintaining permanent control. I've long thought that the approach taken by my parents with far less money was pretty good- you get an allocation at 18, more if you're using to to go to uni. If there's any left over at 21 you get the remainder but after that there's nothing more and no expectation of inheritance. I'd try to follow something like this regardless of scale, if it's a couple of million maybe set up a fund that stops at 25

Re: Combining finances

#84

Post by oarsinsync »

username90 wrote: post #78
ianferrel wrote: post #29

Earlier quoted context omitted.

My wife and I do this, and while we're both savers by nature, I'm more of a saver, so I end up piling up the fun money while she tends to spend hers (I think. Mostly. I don't actually know how much she has in her personal account because I don't care) There's no resentment because we already agreed that fun money isn't part of savings or long-term planning. And the fun money is a small enough part of our overall budg…

> Mostly. I don't actually know how much she has in her personal account because I don't care If you divorce you will, since she will be taking half of yours if she didn't save anything.

The point of 'fun money' is that it isn't money that goes into savings. There's money allocated into savings before any 'fun money' allocations. Anything you have in your 'fun money' account isn't part of your savings, and can (and should) be spent guilt free.

This works as an individual as well, and is the mechanism I used to get myself out of debt. The vast majority of my remaining income after essentials went into paying down debt, or into my savings account. A small amount went into a discretionary spending ('fun money') account. Anything I didn't spend that month simply rolled over to the next month. It never went into my savings, and eventually got spent (usually after several months of 'saving' in the 'fun money' account, in order to buy a new phone / other gadget)

Re: Combining finances

#85

Post by zrail »

burfog wrote: post #75
skrebbel wrote: post #64

Earlier quoted context omitted.

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.

Doesn't that encourage waste? You seem to have decided that a certain portion of income will just be blown on random stuff. I go with double-approval. You could call it a veto system. Both must agree before spending. There is pre-approval for unavoidable expenses like bills, groceries, fuel, emergencies, and tolls.

You have to decide on your priorities. Accepting a certain amount of “waste” in exchange for happy spouses is a worthwhile trade for many couples, including my wife and me.

Re: Combining finances

#86

Post by zrail »

kelnos wrote: post #72
ianferrel wrote: post #29

Earlier quoted context omitted.

My wife and I do this, and while we're both savers by nature, I'm more of a saver, so I end up piling up the fun money while she tends to spend hers (I think. Mostly. I don't actually know how much she has in her personal account because I don't care) There's no resentment because we already agreed that fun money isn't part of savings or long-term planning. And the fun money is a small enough part of our overall budg…

> I don't actually know how much she has in her personal account because I don't care I feel like this is a useful thing to do for people who feel like they might feel resentment (or guilt) at their partner for spending too much (or for spending more than their partner) on fun stuff. As long as neither partner goes over the fun-stuff spending limits, it just doesn't matter, and there's no reason to even know. > And I…

Not the GP but in my relationship if both of us are doing a thing and it isn’t already a gift of some sort it’s going through the joint accounts, not the fun money accounts.

Re: Combining finances

#87

Post by sgt101 »

skrebbel wrote: post #62
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 t…

Think of it as an investment, think of what you get in return. If you didn't have her how would your evenings and weekends be? What would you be willing to pay for that?

If the answer isn't "whooo, a whole lot more than $4k" then you have massive problems with your relationship.

Re: Combining finances

#88

Post by sgt101 »

zimablue wrote: post #83
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…

Effectively you're under their families power, being "discreet" and doling out money adhoc I wouldn't view as positive, it's them maintaining permanent control. I've long thought that the approach taken by my parents with far less money was pretty good- you get an allocation at 18, more if you're using to to go to uni. If there's any left over at 21 you get the remainder but after that there's nothing more and no exp…

I think tax might complicate this.

But, remember, familial power tapers with time, no matter what. And in time you might value the power and leverage that you have to deal with children who display a shocking lack of sense.

Re: Combining finances

#89

Post by aliceryhl »

Me and my boyfriend are students. I have a good student job, while my boyfriend has a large amount of savings. The last system here would just amount to him giving me his savings.

Our system is that we have a shared account, and we keep track of how much money we have both put into that account. I've put in about half what he has put in, because he spent a lot of money when we bought all of the furniture etc. for our rented apartment, when we moved in. So then I just put in a bit more than him each month, until we reach the same level.

Re: Combining finances

#90

Post by [deleted] »

galfarragem wrote: post #77

I'll bite it. With nowadays lifestyle and state of Law doesn't make sense to marry in the traditional sense. Ok you can do a pre-nup but that is a huge hassle for the couple. People value stuff differently and on the long term ignoring that is a certain path to regrets. So the best, IMHO, each one should keep legally their stuff with some joint ventures on common projects (house, etc). However I'm not saying to stric…

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