Divorce an Enabler for FIRE?

[Alan]

Now I'm wondering how many here are happily married and keep their finances separate? Is there such a thing?

omni

We kept our finances separate while we were living together but as soon as we married we combined everything. (0+0 = 0)

 

[Sarah in SC]

We kept our finances separate while we were living together but as soon as we married we combined everything. (0+0 = 0)

Yeah, because we married young, we had the 0+0 plan as well. I think it is way more common (and a good idea) to keep them separate when you marry later in life after accumulating assets. If anything every happened to DH, I'd be very unlikely to commingle assets with a second husband.

Silver, that is truly terrifying. I am so glad that you came out on the other side of it whole, in the end. You just never know.

 

[sheehs1]

Lucky me....since all of our tax returns had been joint, and he had not even paid the FICA for his own or employee's pay, the IRS came after me as well. I was required to re-file marrielus penalties. (We had gotten refunds for most of those years) This process took about 3 years to get through.

I am now blessed with a wonderful husband of almost four years. Lesson learned for me is that you never really know anyone...even if you think you do.

Silver...I'm glad you got thru this. Wish your accountant had invoked the innocent spouse rule. If he or she had perhaps it could have eliminated all the tax re-filings. So glad it is behind you!
You are right though....you never really know what anyone...especially someone who is desperate is going to do.

 

[omni550]

Silver, that is absolutely awful, and must have been terrifying at the time. It's amazing that you were able to trust anyone else enough to marry him. But I am glad all is well now.

Amethyst

+1 !!!!

omni

 

[omni550]

I appreciate the comments about people who marry later in life and keep their finances separate.

Lots of good reasons. A few come to mind.

They more than likely have differing net worths and possibly remaining outstanding individual obligations from a divorce (or 2 or 3 ).

And as we've already heard, some people's spouses do take advantage of them, once there are assets to be had.

Also, adult children from previous marriages often fear that they'll be cut out of any inheritance they feel are due them, after their parent remarries (as the new couple may either have children together or the couple may decide to spend it all or, especially if the new spouse out-lives the parent, given to any prior children of the new spouse).

At the same time, it seems sort of unromantic to enter a relationship with a pre-nup, plans to keep separate finances, and the like. It almost seems like setting the stage to make it easy to split up.

omni

 

[freebird5825]

I appreciate the comments about people who marry later in life and keep their finances separate.

Lots of good reasons. A few come to mind.

They more than likely have differing net worths and possibly remaining outstanding individual obligations from a divorce (or 2 or 3 ).

And as we've already heard, some people's spouses do take advantage of them, once there are assets to be had.

Also, adult children from previous marriages often fear that they'll be cut out of any inheritance they feel are due them, after their parent remarries (as the new couple may either have children together or the couple may decide to spend it all or, especially if the new spouse out-lives the parent, given to any prior children of the new spouse).

At the same time, it seems sort of unromantic to enter a relationship with a pre-nup, plans to keep separate finances, and the like. It almost seems like setting the stage to make it easy to split up.

omni

And let us not forget outstanding debt, which a spouse-to-be may or may not disclose before the marriage. I have a close female friend who got caught in that web. She is still married, but his "carried along" debts had a tremendous negative impact on their finances and quite frankly, seriously undermined their married relationship. It all w*rked out, but for a while there she was ready to split up.

I mentally wrestled with the pre-nup concept when I was formerly engaged (ex-dh2b), and definitely keep it forefront in my mind when Mr B and I loosely discuss marriage down the road. He has grown children. I have assured him that I neither need nor want anything he wants to leave to his children, and would willingly sign any pre-nup stating such. It's no big deal to me. I have my own benefits and portfolio.

In a perfect world, the legal and financial ramifications of re-marriage would not interfere with the romantic ideal of entering into matrimony.
But I am a realist, and no matter what impact it has psychologically, a pre-nup is a solid requirement for me to say "I do".
My attorney has thoroughly and repeatedly advised me on the need for a pre-nup. Who am I to argue with the law?

 

[easysurfer]

I'm not married and not divorced, but find that one of the most important money knowledge gained from this forum is the importance of someone with a similar financial philosophy. I've seen in others the stress brought about with people of different philosophies. One wants to LBYM, while another thinks money in the bank is money wasted. One wants to avoid racking up huge credit card debt while another sees that as a rite of passage. One can't earn/save money as fast as the other spends it.

 

[Nords]

Now I'm wondering how many here are happily married and keep their finances separate? Is there such a thing?

Spouse and I have kept separate checking accounts for over 30 years just to make sure we kept track of our pay and travel claims. We'd frequently be spending money in different time zones so separate checking accounts really cut down on the "oops". Now we just shovel our excess into the same money market account for the higher balance & interest rate.

We started combining our investment accounts when we got married-- our IRAs stayed separate, of course, but we opened a joint (taxable) account at Fidelity. We invested in other mutual funds before our marriage but those eventually got cashed out and ended up at Fidelity. I remember the good ol' days of sitting side by side writing checks to the mutual funds every two weeks.

At the same time, it seems sort of unromantic to enter a relationship with a pre-nup, plans to keep separate finances, and the like. It almost seems like setting the stage to make it easy to split up.

Our daughter's been aware of the horrible finances of her friends (even though she's made some whopper mistakes of her own) and she feels very protective of her IRA & taxable account. She's told us (with all the serious intent of an 18-year-old) that she's only getting married with a prenup.

We've hastened to reassure her that she won't have to worry about inheriting any assets...

 

[simple girl]

This divorce thread is interesting, but also a little depressing. As someone young and married (almost 5 years now)... Is there anyone on here not divorced?

Coming up on 17 years of being very happily married. DH and I share the same financial value system and have built our networth together from the ground up.

Been seeing things a bit too close up with a couple that are friends of ours. They keep all funds separate and they just seem to be on totally different pages for spending. I am trying very hard not to give unsolicited advice, but it is hard for me to stifle my urge to share my opinion on their financial communication issues.

We actually are experiencing the same thing right now. The wife spends and spends and spends. The husband sees how DH and I manage things and so wants his wife to get on board. He talks to me about it and has asked for advice for how to get her to stop her excessive spending. He says she goes through $10K a MONTH like it's nothing! Gah! Says he tried to put just $8K in the account every month, but she will overdraw it, and they end up with bank fees. I'm really worried about their marriage with such financial issues. Touchy subject indeed.

 

[DesiGirl]

15 years marriage.
We started from 0+0. Built everything together. Even supported his family (still doing), his brother's education + marriage expenses. It has always been We. I never even knew ATM pin no. . I do big picture planning, right now all non-retirement (majority of) assets are in my name (tax reasons). He says if he looses me money won't mean anything anyway and kids would be the first thing I would take from the marriage if it comes to that.
Both r cheap sobs (Uncle Mic ;-)
Right now I'm stay-at-home but pushing harder for his ER, making cheaper choices which even irk him many times .. he complains sometimes "I want to live" and I tell him "U got to Retire ASAP".

I guess may be due to being Indian or old fashioned people, we r stuck for eternity ... not that I'm complaining.

I think finding a like-minded compatible spouse is such a blessing definitely huge contributor to ER or any other goal you may have in life.

-DesiGirl

 

[Danmar]

I don't think a marriage can survive without a compatible view on financal matters. We have worked out a system that keeps all the accounts(both cash and investments) separate but we manage them together. She has her own cash accounts so I don't have to write cheques for her. I fund her expenses so she can reinvest her investment income but this amount is small and hasn't canged in years. I pay for all the large expenses. Has worked for us but obviously there are many ways to set this up and as long as the spouses are on the same page everything will likely be OK.
No prenup because when we first got together she helped support me. Don't think I would want one at this point -ie" if it ain't broke don't fix it."

 

[chris2008]

30 years together, 28 of these married.
We are on the same page, financially and otherwise.
Still each of us has own priorities, but we talk to make them match.

A divorce can be the enabler of FI, but only if chosing the wrong partner created an obstacle before.
If you do not have the right mindset for FI a divorce will not help....

 

[Walt34]

Though it seems like a common thread in these is a difference in financial thoughts and habits - the wife and I are very like-minded when it comes to frugality and FIRE.

That was one of the lessons learned from the first marriage. DW and I are so "on the same page" about money (which is really about priorities) that sometimes it gets a little weird, like telepathy or something.

And it really isn't about money. To us, responsibilities come first, then go play. The ex reversed those priorities. That's why I can say that I wasn't inherently opposed to anything the ex wanted to do. I just won't do it on credit.

Or as one of my sisters put it after the divorce "Opposites attract but they can't live with each other". Which about sums it up.

 

[KingB]

Going on 43. Happily married. Started with 0. We have always combined our resources. Income and expenses are tracked on Quicken (before, by Money) so we both know what the other is spending.

She used to be the CFO, but we found early on that I can better our finances. So we switched responsibilities - I am the CFO and she the CEO.

 

[nun]

Here's a slightly different angle. I have a 45 year old friend who is a partner in a consulting business. His third share ownership is worth a lot. Before he built the business he was quite keen to get married, now he says he'll never get hitched or even get into a common law situation. He has a great girlfriend of 3 years who is really nice and works as a clinical nutritionist, so he has the bigger bank balance, but as they are "just dating" as he says money isn't a big factor. However he's just waiting for the marriage conversation. I feel sorry for him, but understand his thinking.

 

[chris2008]

@nun: If your friend wants to build a future with another person he should better look for a partner with similar financial standing and he should tell his current GF as soon as possible that there will not be a future as a family for them.
She deserves to know. "Just dating" might be only his point of view.
If she has never shown signs of being a gold digger it is not fair to treat her like one.

 

[Danmar]

@nun: If your friend wants to build a future with another person he should better look for a partner with similar financial standing and he should tell his current GF as soon as possible that there will not be a future as a family for them.
She deserves to know. "Just dating" might be only his point of view.
If she has never shown signs of being a gold digger it is not fair to treat her like one.

well put. I agree. if a person just wants to have fun that doesn't make them a gold digger.

 

[Coastie]

I didn't know how big a spendthrift I was married to (29 years) until she died. After her passing I was able to save over 50% of my income which allowed me to FIRE 3 years earlier than planned. Such a sad way to reach your goals, however things do happen that you can't control.

 

[Bestwifeever]

DH and I were married at 22. Also merged our $0.00 "portfolios". We grew into our financial outlooks together--neither of us came into it with a thought-out strategy about handling finances.

 

[Nords]

He says she goes through $10K a MONTH like it's nothing! Gah! Says he tried to put just $8K in the account every month, but she will overdraw it, and they end up with bank fees.

Just out of [-]envy[/-] curiosity, what the heck is she spending it on? I could understand a recurring expense like yacht maintenance, but having to creatively come up with unique expense categories every month seems like an insurmountable challenge.

She used to be the CFO, but we found early on that I can better our finances. So we switched responsibilities - I am the CFO and she the CEO.

When spouse's pension starts up at age 60, she's promised to take over the bills & finances. (Which I should have completely in auto-pay by then.) For some reason she expects me to die first, so we figure this will help her get a handle on the finances long before it becomes a crisis.

 

[ronin]

Just out of [-]envy[/-]...she expects me to die first...

Living up to expectations takes on a whole new meaning!

 

[freebird5825]

Just out of [-]envy[/-] curiosity, what the heck is she spending it on? I could understand a recurring expense like yacht maintenance, but having to creatively come up with unique expense categories every month seems like an insurmountable challenge.

Shoes, shoes, and more shoes

And then there are designer clothing, hairdressers, spas treatments, QVC, more clothing, jewlery, big ticket luncheons, yet more clothing, expensive bottles of wine, yadda yadda yadda...

Send me $10K and I'll show you how it's done. In my wildest dreams, of course.

 

[Amethyst]

Here is what one lady friend and her husband consider necessary to a decent lifestyle:

*Frequent vacations
*Frequent eating out
*Lots of wine, and darn good wine at that (Well, I can sort of understand this priority )
*Fashionable clothes and shoes every year
*Maid service (even when she was a single town house owner)
*House professionally decorated
*Will not eat leftovers (even though she's an excellent cook)
*Will not wash anything by hand
*Yard service (small yard, I could do it all in one weekend)
*Cars get bathed at the gas station
*Personal trainer

I've come to realize, they feel sorry for us and think we live very dull lives. (I've also heard her say "I'll probably never be able to retire.")

Amethyst

Just out of [-]envy[/-] curiosity, what the heck is she spending it on? .

 

[simple girl]

Just out of [-]envy[/-] curiosity, what the heck is she spending it on? I could understand a recurring expense like yacht maintenance, but having to creatively come up with unique expense categories every month seems like an insurmountable challenge.

Shoes, shoes, and more shoes

And then there are designer clothing, hairdressers, spas treatments, QVC, more clothing, jewlery, big ticket luncheons, yet more clothing, expensive bottles of wine, yadda yadda yadda...

Send me $10K and I'll show you how it's done. In my wildest dreams, of course.

I'm thinkin' Freebird nailed it. He said she goes nuts spending $ on clothes for her and the kids - probably about $1K a month. I'm assuming the rest goes to their other bills - the big house, car, etc. He's asking me for help in getting her to be more conservative in her spending habits. Ha! I will tread lightly on this one. He may want my help, but I don't think she wants to learn how to shop at the Salvation Army. LOL

 

[foxfirev5]

We've been married for 33 years and never considered separate finances. Of course it would have been hard in the begining to split up our combined $175/ week income. We have LBYM for decades while raising three kids and paying off two homes. It's a matter of priorities. We spend very little on clothes, dining out, hobbys, or entertainment during the bulk of the year. However, we drop a considerable chunk on our lake house, boats and nice vacations. Fortunately we both enjoy the same things. As my DW retirement nears we'll probably pick up the pace a little more. I hit my initial planned retirement age (55) and financial goals a few months ago. Now while we continue to save, each paycheck is a bonus .
Teamwork, start saving early, and LBYM.