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Old 01-23-2013, 08:49 PM   #1
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TOOLMAN Intro

I AM; 57, and DW is 57. Found this site a few weeks ago.

DW & I grew up very poor, in nowhere WV, we started dating in 1970. We have always worked. Have W2’s back to age 14. I have always worked full time, and DW always worked part time. My income is now 7X DW. DW & I are not compatible with money; I am a saver, and DW is a spender.

The system I found, as a work around this was; “needs” 1st, and “wants” 2nd. I set the “wants” portion aka pocket money at the first of the year, and write monthly allowance check. Neither is accountlable to other on how the money is spent. Been on this system since 1982. The annual “wants”rate has been set to between 1-2 % of NW. The way the system works is; if you want more pocket money - then grow NW. Today DW has $0 in pocket money reserves, and I have 500K.

Our NW is 3.6M, no kids, no debt, no pension. I intend to RE at 58, and DW RE at 62. Annual expenses in retirement budget at 140K.

I don’t expect to turn into a spender in retirement, and I don’t expect DW to turn into a saver. Not sure if there is a better money solution in retirement or spending habits change. I guess we balance each other out. Neither is perfectly happy with pocket money formula, but we found this working compromise. Not sure if this a common issue or patterns change in retirement.
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Old 01-23-2013, 10:03 PM   #2
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Sounds like a pretty good system.

Welcome!
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Old 01-23-2013, 10:52 PM   #3
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Wecome to the board... nice system... have realtives in WV.. pretty state, hard working people...
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Old 01-23-2013, 11:26 PM   #4
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Welcome! You've done very well and should be pretty comfortable in retirement.
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Old 01-24-2013, 01:02 AM   #5
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Welcome to the forum.
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Old 01-24-2013, 02:46 AM   #6
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Welcome!
You have worked out a system that works for couples with different spending patterns. The benefit is that it reduces the need to argue over purchases.
It would not work if the spending lover does not restrict himself to stay within the budget but goes into debt.

The part I do not quite like is the
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Originally Posted by TOOLMAN View Post
I set the “wants” portion aka pocket money at the first of the year,
I'd prefer to do this as a joint decision of both partners.
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Old 01-24-2013, 05:37 AM   #7
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Welcome to the board. It sounds like a good plan to me.

My wife and I have a similar system. We each get an equal monthly allowance to use how ever we want. The rest is for bills and savings/retirement. Although we are both retired we continue to get our allowance. Fortunately we think along the same lines for the most part. I think I have influenced her a little on being frugal and she helps me lighten up a little with enjoying life more. Since I tended to save most of my allowance through the years the best part for me is that I get to buy her nice presents instead of spending on myself and that gives me great pleasure.

Cheers!
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Old 01-24-2013, 06:27 AM   #8
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Welcome!

It sounds like you have arrived at a system that works for you and are ready for what you want to do.
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Old 01-24-2013, 06:40 AM   #9
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Quote:
Originally Posted by chris2008 View Post
Welcome!
You have worked out a system that works for couples with different spending patterns. The benefit is that it reduces the need to argue over purchases.
It would not work if the spending lover does not restrict himself to stay within the budget but goes into debt.

The part I do not quite like is the


I'd prefer to do this as a joint decision of both partners.
Monthly allowance is set by mutual agreement not unilaterally, as I implied. Over the years it has ranged from $200 to 2,000 each per month. It's now down to $1,000 per month, as we sprint toward ER.
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Old 01-24-2013, 07:19 AM   #10
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Welcome, and I congratulate you on the system you worked out, to the happiness of both.
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Old 01-24-2013, 08:21 AM   #11
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Welcome and congrats on finding a balance with your DW. Hey, with your annual budget, I would be able to go through another mid-life crisis and start buying high end sports cars again
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Old 01-24-2013, 08:42 AM   #12
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Welcome... looks like you are in the sweet spot...

Sounds like a great system as long as DW follows the rules... mine does not... she is not an over the top spender, but really can not follow a budget very well...

She thinks that $40 a month for son to get a gym membership is nothing... but, when added to the cleaner and her hair etc. etc. it adds up...


Now a question.... do you include your $500K of pocket money in your net worth If you do, then DW gets to spend some of your money each year!! It adds up over time...
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Old 01-24-2013, 02:36 PM   #13
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Originally Posted by Texas Proud View Post
Welcome... looks like you are in the sweet spot...

Sounds like a great system as long as DW follows the rules... mine does not... she is not an over the top spender, but really can not follow a budget very well...

She thinks that $40 a month for son to get a gym membership is nothing... but, when added to the cleaner and her hair etc. etc. it adds up...


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We must be married to twin sisters...
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Old 01-24-2013, 03:23 PM   #14
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Now a question.... do you include your $500K of pocket money in your net worth If you do, then DW gets to spend some of your money each year!! It adds up over time...
I DO include it in our NW. I reason; as we are the same age, DW will likely out live me, an go onto spend may stash. If hard times come, I would give my stash to meet our "needs".

DW & I are compatibable on most everything, except the pending vs. savings thing and I have been told divorce is a poor financial decsion.
I guess you could trade the DW for a more well to do model, who shares my saving values, but those chances are slim to none.
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Old 01-24-2013, 05:52 PM   #15
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I think you have a good system. DH and I have a somewhat similar system. At the beginning of the year we set up a set amount of spending money that each of us get. Each of us can spend this money however we want without being accountable. The main things that tend to come out of this money are: Books or other personal entertainment items, software and computer related expenditure. This includes computers and ipads. It also includes discretionary items that are outside the regular budget.

The regular budget does include some wants as well as needs but are wants that DH and I basically spend equal amounts on and want to handle collectively (example: cable TV and netflix).

The reason we include computers in the spending money (I consider computers a need not a want) is that we each enjoy higher end computers. By setting up the spending money we set an upper bound for what we can spend and it saves up from ourselves....

Doing this has totally reduced stress. I no longer think DH is "wasting" money on buying X and he doesn't think I'm "wasting" money on buying Y.

We set the spending money as a monthly amount at the start of the year and may add to it if we receive unanticipated funds.
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Old 01-25-2013, 10:25 AM   #16
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Excellent system. DH and I do the same - we each get the same monthly allowance. Its not based upon a formula per-se - just a set dollar amount per month. We each get the same amount and the "rule" is that we are not allowed to question each other on how it is spent. Makes for happy days !
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Old 01-25-2013, 01:23 PM   #17
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Excellent system. DH and I do the same - we each get the same monthly allowance. Its not based upon a formula per-se - just a set dollar amount per month. We each get the same amount and the "rule" is that we are not allowed to question each other on how it is spent. Makes for happy days !
Agree and we do the same.

Oh BTW, welcome Toolman, WV is a great state.
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Old 01-25-2013, 05:22 PM   #18
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Welcome, Toolman! I grew up on the MD side of the MD-WV border.

Sounds like you are well-positioned for ER and have come up with a good system for managing your different financial temperaments. After reading all of these posts, I'm feeling truly blessed that DH and I have very similar financial orientations. I'm a little more aggressive on the investment portfolio and he's a little less frugal than my Scottish tightwad bloodline. We've been married 26+ years and I truly can't remember any significant arguments we've had about money.
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