Financials and Dating

[pb4uski]

I always request a financial statement certified by one of the Big 6 accounting firms. I'm still single.

Stuck in the past too... it's been the Big 4 since 1998 when Pricewaterhouse and Cooper's & Lybrand merged to become PricewaterhouseCoopers.

 

[ugeauxgirl]

I started dating DH shortly after my divorce. I hadn't thought much about being on the same page financially with husband 1, but I wasn't going to repeat that error. DH and I were very upfront about finances while we were dating, and discussed spending decisions. We were a great match- he was great at personal finance, I was great at investments, and we are both frugal.

 

[Dawg52]

Stuck in the past too... it's been the Big 4 since 1998 when Pricewaterhouse and Cooper's & Lybrand merged to become PricewaterhouseCoopers.

I almost put Big 8. The good old days of the past......

 

[gwraigty]

Just read the comment broke and in debt doesn’t mean you’ll stay that way. Well, spending habits are hard to break. If there’s a question get a prenuptial signed. Don’t mean to be jaded but who needs to give up half of what they spent a lifetime accumulating on relationships later in life

That was in my post. Did you miss the part where my "spending habits" were due to my dying mother's medical expenses? After she died, that spending stopped and I was able to crawl to solvency for the first time in my life.

 

[street]

Very interesting topic and story's of your journey of success.
When we got married 35 years ago, not really sure we talked much about finances. I did have a lot more money then she did. From the start we combined our money and she did all the financing but I was always was engaged in what we had, and watched very closely what was spent and where.
Her mother was a spender of all spenders and was a problem at one time. I didn't know that till many years into our marriage. My wife turned out to be very frugal and I always through the years, encourage saving and investing.
Today, she still does most of the monthly/yearly financing and I lead in the investing part. I would say today she is way more frugal then I am today. I do feel without the continuing reminders of saving and me keeping a close eye on investments it would be the other way.

 

[athena53]

I've found that if both people are financially independent (that does not mean wealthy) then money is less of an issue. However, if one is dependent upon the other to finance the two week vacation in Hawaii, the theater tickets to see Hamilton, and the salsa dancing lessons, then there may be issues caused by dependence.

None of this means the wealthier person can't do something nice like say "Let's take that 8 hour non-stop flight to Paris, instead of the two stop 20 hour flight. I'll pay the difference."

What's bad is when one person has to go into debt to keep up with the other person. Or has to lie about why he/she can't accompany the sweetheart to Paris at any price.

Yeah, it's tricky. My friend loves travel as much as I do but doesn't have the budget to keep up with me. I went through this with my late husband when we were dating; he made half what I did. I was racking up a lot of miles and hotel points from business travel and credit card use, so frequently I'd use miles for his ticket- somehow it didn't seem as blatant as paying real money for it. The hotels didn't charge extra for a second person. He'd pick up some meals and admission fees and I was happy with that.

Next month I'm heading to my favorite B&B on the Katy Trail and my friend is coming with me; the B&B doesn't charge extra for a second person so it will be a similar deal. He's working on getting enough miles to go to Europe in Coach class and I'm hoping to rent an Airbnb place in Munich for 3 weeks next year. So- he can get himself there on his budget and his schedule (he's still working) but with no hotel costs.

I agree on being honest about all this. A friend told me that his sister is expecting to inherit some unique pieces of jewelry their late mother brought from Cuba in the 1960s. What she doesn't know is that when Dad was running low on funds trying to keep up with a GF who had more money, he sold the jewelry.

 

[The Cosmic Avenger]

I agree on being honest about all this. A friend told me that his sister is expecting to inherit some unique pieces of jewelry their late mother brought from Cuba in the 1960s. What she doesn't know is that when Dad was running low on funds trying to keep up with a GF who had more money, he sold the jewelry.

Rule #1 of inheritances is to be prepared for the worst and never rely on them. Lawsuits or medical problems can eat up the biggest nest egg, so just consider them potential icing on the cake.

 

[athena53]

Rule #1 of inheritances is to be prepared for the worst and never rely on them. Lawsuits or medical problems can eat up the biggest nest egg, so just consider them potential icing on the cake.

Totally agreed but in this case the jewelry was unique had great sentimental value- one piece had a Cuban gold coin in it. I'm sure that if Dad had been honest with the family about wanting to sell it to raise funds, a family member would have bought it.

 

[The Cosmic Avenger]

Totally agreed but in this case the jewelry was unique had great sentimental value- one piece had a Cuban gold coin in it. I'm sure that if Dad had been honest with the family about wanting to sell it to raise funds, a family member would have bought it.

Oh, absolutely. When my father sold the house I grew up in, I was 3 states away. I asked him what happened to the stuff in the attic: my childhood toys, grade school papers, artwork, etc. He said he had no idea, he sold it as-is and didn't even look up there. I wouldn't have kept much, but I probably would have selected one box of items that held the strongest memories for me.



Not quite the same, but my point was, I agree with you that unilaterally disposing of items to which family members have an emotional attachment is rather thoughtless and selfish.

 

[NW-Bound]

I noticed that the OP posted this thread in the "Young Dreamers" forum. And indeed, his profile says 2037 is the target retirement date.

Is there a difference between dating for younger workers vs. er, geezers who already retired?

I think there is. The young person may be looking for a spouse to build a family and perhaps to have kids, while single/divorced/widowed geezers mostly want companionship. The former requires more care and has more at stake. The geezers have more latitude and independence.

 

[karen1972]

I guess it depends on why you are dating. I wasn't set on finding "the one", so I was dating for companionship, thus I didn't broach the topic of real finances until I was 4 months in and started thinking this was actually leading somewhere.

It allowed for a more natural relationship and what we planned on dates, etc to me seemed a better indication of what we would be like long term. Our first trip together was a work trip where his ticket and hotel and car was paid for so I just had to pay for my flight. That to me was good to see on what he felt needs/wants for a vacation would be which is a place where people can go crazy spending money.

We met late 30s, I was close to FIRE, he was 6 years in arrear on taxes and his personal business in trouble due to the last recession and non-paying customers. Needless to say it was interesting figuring out if we were going to work. However, by being with him those 4 months I got a much better picture of who he was and he had learned to trust me so we were able to have a very open and frank discussion, we created a plan together and 10 years later we are very happy together. Financially he has done a 180, but he was at that point he wanted to change and was asking for help, not something most people do.

So it can work as long as you both are willing to work on it and get on the same page. Though I was much more willing to work on the relationship given the number of guys I had met along the way that while they made huge amounts of money, spent it like crazy and had zero inclination of changing. So I chose broke with potential... and he was fine if I retired and he kept working as he felt that was fair, that was a big thing since I wasn't sure I was willing to delay retirement for a decade to wait for him to "catch up".

 

[kgtest]

For anyone who has successfully found a good FIRE partner or is currently searching for one, I'm wondering how/when you brought up your financial situation with your prospective partner?

It would seem that wealth (high salary or high net worth) should be kept private, to avoid that being the main focus for pairing up... to avoid attracting people who may want your wealth or net worth to spend. However, the flip side is that it is important to know someone's financial health as a means to decide how reliable a partner they would be in marriage. I've come to appreciate that people don't often change. That is, if they were raised to be in debt, and carried debt in their 20's and 30's... it's likely they won't magically change in their 40's because they met someone they love who taught them about money. That, said I'm not against helping a partner be better with finances, I just would rather find someone who already is. If that makes sense?

So when and how is the best time to bring this kind of thing up? Is it good to talk vaguely around it on a fourth or fifth date (as in, ideas about financial behaviors, but no specific to your own situation or theirs) early on. Or should numbers and situations be described more in detail early on to avoid going down the road with someone who may otherwise be perfect, except a potential financial disaster. Also, I obscure my wealth and income quite well. I live very modestly, and even my friends and family are a bit clueless to it. So if someone were a FIRE guru like myself, they might look at my life and wonder if I have my act together too. It goes both ways. So what is the safest way to lower that net, so to speak...

Not sure if there is a coherent question in there, but I'm sure I wrote enough to get the topic started

Mainly I'm just curious how you went (or are planning to) go about evaluating financial compatibility with potential partners.

My wife disclosed her wealth after we were married I asked for a prenump, but she said no. Turns out I was poorer than she, but alas the tables have finally turned...just took me about 6years of fine tuning and high earning!

We still don't really share a checking account. Money does exchange hands but I am not keepin tabs. Things could get interesting if/when inheritance comes. Both our folks are likely similar NW and similar age so again nothing really to worry about later either. Just need to watch the fee's and expenses.

 

[brett]

I think being on the same page from a spending and debt perspective is crucial.

We always had joint accounts until our asset base grew. For the past 15 years DW has far more than I do....most of our investments have been placed in her name. Fortunately she is frugal and typically her buy decisions are based on value, not price or some imaginary discount off list scam.

We were fortunate. Married young while in university. Got used to managing money and not succumbing to consumer debt or credit card debt That lifestyle just continued on.

 

[ExFlyBoy5]

Long story short, I was raised to be frugal. Did OK with that until early 20's when I got married to a woman who spent money faster than it came in. Her mantra was "if I can make the minimum payment, then who cares how much debt you have?" Among other issues, this disconnect in financial beliefs destroyed that marriage.

Fast forward to 32 years old. Finally have my finances in the right direction and doing very well for my age. Started dating again...didn't discuss finances much. It wasn't hard because I was an enlisted military dude, so no one thought I had any money, anyway.

Eventually, met the gal who I would marry and on the 3rd date, I brought up that if we were to get serious, it would require a review of her credit report and marriage would require a pre-nup. Could it have been the end of that relationship? Sure, but it wasn't. Thankfully, she had smarts about money and wanted to see my credit report, too. Anyway, we have been married for 10 years and we have never had a spat about money...I think much of that was because we were open and honest fairly early on.

 

[ChiliPepr]

For anyone who has successfully found a good FIRE partner or is currently searching for one, I'm wondering how/when you brought up your financial situation with your prospective partner?

We have been together for about 18 years, living together for about 12, but never married. We have never had a serious discussion on finances. I own the house and she chips in a monthly amount, about half the monthly housing costs without the mortgage.

She is smart with her money, I am smart with mine. but we do not have in depth knowledge of the others finances.

 

[Teacher Terry]

I met my husband about a year after both our divorces. My kids were grown and his were 8 and 10. I was in better shape as he lost his job and couldn’t find another. He was giving up his apartment and quit opening his mail because he couldn’t pay his bills. I told him to stop wallowing and get a survival job. He got 2. I sent him to consumer credit to negotiate his debt. He moved in and the cost of my condo was based on what I could afford to pay. I paid for food so he could concentrate on his debt. After 2 years he got a job in his field. Then he split the cost of food and paid for some other things. We married 5 years later once he was out of debt. It was a rough financial start but 21 years later still happy together. In retirement we are better off financially together because we left our pensions to each other when one of us dies.

 

[O2Bfree]

When DH and I met 24 years ago, he was freshly divorced after being separated for about a year. He was looking at about 8 years of child support, which took nearly half of his paycheck during that time. But he never complained about being short on money, and always paid his bills and his share of the trips and other things we did together. I've always made about 50% more than him, but he never expected me to pay more.

It was clear early on from our habits that we were on the same page regarding money. We'd both always carefully consider how much pleasure and use we'd get from a purchase before buying, save up to pay cash for large items such as vehicles instead of taking out a loan, buy used whenever it made sense, avoid waste, never carry a credit card balance, and stash extra cash instead of looking for ways to spend it. It was clear that neither of us were much impressed by expensive things, and preferred to live rather modestly with the goal of retiring early. Over the years we've shared our progress towards this goal.

So we never had to have "a talk" about money. But if we'd met just recently, I would at some point want to share our financial numbers to see how they might affect our goals. I'd expect that in a promising new relationship, the comfort level would be high enough that such topics would come up naturally after a few weeks or a couple months and proceed without drama.

 

[Moemg]

I started dating for the last time at 52 after being widowed . If anyone brought up financial anything at the first date I would think they were crazy . The first several dates are getting to know each other and whether you have anything in common .When it moves to a more serious point is when to bring up financials.

 

[Scratchy]

There are potentially some significant financial benefits to being married, as opposed to being single, in retirement. The ones I'm aware of (I would be interested to hear what other ones there are that I haven't listed below):

-With the latest tax reforms, there is now often a significant"marriage benefit" in federal income taxation, at the income levels of most retirees who are drawing social security and have some dividends/RMD's.
-Spousal social security benefits
-More favorable RMD schedule for inherited spousal retirement accounts (With pending legislation which would require these accounts to be withdrawn in their entirety within 10 years for non-spouses, this may be even more the case).
-In my state (California), spouse inherits low property tax rate for home (but still gets the step-up in basis for capital gains taxes if the home is eventually sold).
-Some retirees have pensions with spousal survivor's benefits.

So for many couples, there may be some very good financial reasons to get married in retirement (though of course the non-financial issues trump financial considerations). It seems to me that it's expensive to be single in retirement!

 

[youbet]

There are potentially some significant financial benefits to being married, as opposed to being single, in retirement.

And there are some financial downsides as well depending on whose SS# various taxable income sources are linked to. It requires a close look.

 

[Scratchy]

And there are some financial downsides as well depending on whose SS# various taxable income sources are linked to. It requires a close look.

This is very true. The best way to know for sure is to run pro forma returns. Turbotax has a "what if" feature that is helpful. There are some income tax "cliffs" with respect to social security taxation, net investment income, and ACA subsidies whose effects are very difficult to assess.

 

[SecondCor521]

There are potentially some significant financial benefits to being married, as opposed to being single, in retirement. The ones I'm aware of (I would be interested to hear what other ones there are that I haven't listed below):

IRMAA adjustments to Medicare premiums are more draconian for single people. My Dad is paying more now after my Mom died because he has the same income but files single instead of MFJ.

On the other side of the coin, some pensions go away if the person remarries. I know a couple who is just "church married" but not "government married" for exactly this reason. (It is my understanding that they are "church married" because the husband's son doesn't want them living in sin, as the phrase goes.)

 

[RunningBum]

Is IRMAA really a big deal?

In an extreme case, where a couple was making just under $170K and no IRMAA adjustment, and one dies and IF the other was still making about that much, they would have a $433/month adjustment. That's $5000/yr, not chump change, but we are talking about someone having a MAGI of nearly $170K, not to mention any assets they could spend down tax free. And with just the loss of one SS check, they probably drop below $160K for an adjustment of $352/month, about $4000/yr. Again, we're not talking about someone trying to eke out a living on SS alone. Is the IRMAA adjustment really a burden on your Dad?

This is a lot less than many of us would lose if we went $1 over the ACA subsidy limit of ~$48K for a single, and for many in that income bracket that really is a hardship.

 

[SecondCor521]

Is IRMAA really a big deal?

In an extreme case, where a couple was making just under $170K and no IRMAA adjustment, and one dies and IF the other was still making about that much, they would have a $433/month adjustment. That's $5000/yr, not chump change, but we are talking about someone having a MAGI of nearly $170K, not to mention any assets they could spend down tax free. And with just the loss of one SS check, they probably drop below $160K for an adjustment of $352/month, about $4000/yr. Again, we're not talking about someone trying to eke out a living on SS alone. Is the IRMAA adjustment really a burden on your Dad?

Well, my Mother was Scottish so I got the impression that part of the way to financial success and well-being was to watch the small things. $4K or 5K per year, as you note, is not chump change.

I don't recall exactly how much of an IRMAA adjustment my Dad had after my Mom died. I do remember having to figure it out, because his SS check went down and, well, in my family of origin we investigate those things and figure out what's happening.

Overall, though, both SS and the IRMAA adjustment are relatively small things in my Dad's financial world. I apologize if I gave the wrong impression in my previous post. I'm recovering from sinus surgery and am not yet back to 100% and couldn't/didn't think of a better and more precise wording.

 

[RunningBum]

Overall, though, both SS and the IRMAA adjustment are relatively small things in my Dad's financial world. I apologize if I gave the wrong impression in my previous post. I'm recovering from sinus surgery and am not yet back to 100% and couldn't/didn't think of a better and more precise wording.

I hear a lot about IRMAA, not just your post, so I was trying to figure out the impact, and asked to see if there was something I'm missing. Draconian was the term that triggered it for me, for about a 3% surcharge, I think?