Talking to my wife about finances

[catii]

Hmm, my case seems to be the opposite of most. My wife has handled our finances since we got married 43 years ago. About a year ago, right after she retired, she mentioned that our house & rental properties are all paid off (quite a feat in Hawaii!), & that we'd have everything else paid off within a year.


That's when I discovered that I didn't have a clue about our finances! We're both engineers, so I asked her to provide me with a summary spreadsheet each month, that would allow me to access all of our accounts. It took her a couple of months to condense everything to a single page, but I can now tell what's going on, at a glance.


Now, she's working on a second summary sheet that lets me know what we're going to be living on, year by year. In other words, over & above our fixed SS & rental income, we'll take $X from Wells Fargo, $Y from Vanguard, & $Z from an IRA. Very useful info!

 

[steveark]

You are lucky, my wife still has term life on me and I'm 65. That only makes sense if I fall off a cliff on one of our bush whack adventures. It irritates her when I tell our friends if that happens it wasn't an accident.

 

[brett]

DW joins me for a meeting with our investment advisor once a year. I handle all of the bills, tax, etc.

DW has provided some solid investment advice. A few times when I have been tempted to sell during a downturn she convinced me not to. And to double down when prices were low. That sober second opinion has served us very well over the years.

 

[rt-texas]

So I was talking to my wife this afternoon about step up basis and what that means if I die or her mom dies. We must have been talking for 2 or 3 minutes when I look over at her and she is pulling her nostrils apart with her index fingers. Then she says to me "you know, if I pull my nostrils apart, I can smell the cheese I just ate!" She's not very interested in our finances.

My word, sprayed iced tea all over my shirt when I read this. Thank you, such a funny mental picture.

After reading the whole thread, agree with a lot of what people have said and recommended. I take care of the bills and finances. DW and I sit down once or twice a year and go over everything, but I'm the OCD one of the pair and she's happy to let me be that way.

We test drove VG PAS for a year while we we're dealing with some health issues, so I have told her to go back in and hire them again when I'm gone. No kids, but BIL is in finance and can help her with the transition.

She has a letter with an overview of our current lawyer and accountant with contact info. She has electronic copy of all my passwords, as does our accountant. They get updates every six months or less if needed. Will and legal docs were updated 2.5 years ago.

She has separate password protected files and thumb drives with all financial accounts and credit cards, due dates and the like.

Letter even includes instructions to keep paying for my phone till all CC's and financial accounts are transitioned because I have two-step on everything I can.

Someone on ER posted this some time back and I used it as my guide to update and add to my information for her. It's good to make you think about what they might need when your gone. I appreciate whoever posted this in the past.

https://www.erikdewey.com/bigbook.htm


Free and recommend.

 

[rk911]

You are lucky, my wife still has term life on me and I'm 65. That only makes sense if I fall off a cliff on one of our bush whack adventures. It irritates her when I tell our friends if that happens it wasn't an accident.

lol...i sometimes introduce my wife as ..."my first wife, Donna". she laughs when i do that.

 

[JohnRM]

Step-up basis

Am I misunderstanding how that works? So, If President Biden takes away the stepped-up basis provision, and if say your mom dies and you inherit a house your parents bought for $50k in 1970, then you sell it for $400k, that's $350k capital gains (minus deductible and carryover losses or what have you)



BUT... If you die, your spouse still owns the house, so if he or she sells it the basis is whatever you paid for it anyway, just as it would be if you were still alive, right?



It would be nice for both parties in a marriage to have an interest in finances and could help plan... But I think usually only one person is handling it. I am that person, but it would be nice to have someone to help figure things out, like we do with the crossword puzzle.

 

[Kroeran]

After a lifetime of responsible behavior, dont drop the ball on your last act.

Do the footwork of finding the best firm and best manager in town to take things over if you don’t wake up one morning.

I would overweight fraud risk management, a firm with supervised management of advisors, and the risk of close relations, children, taking advantage of the indifferent spouse.

You also have to manage the risk of a long lived parent outliving you, if you are responsible for their affairs.

It involves an expensive will done in cooperation with Trust Company lawyers.

 

[Gumby]

Am I misunderstanding how that works? So, If President Biden takes away the stepped-up basis provision,....

I really must take issue with this part of your post. It is Congress that writes and passes tax laws, including any law that would affect the step up basis on inherited assets. The President can only sign or veto what Congress passes. And, in any event, I am unaware that the Biden Administration is advocating elimination of the step up basis.

Now returning you to your regularly scheduled programming.

 

[skyking1]

We have been having more conversations over the last few days, she is pretty much up to speed on the current strategy. She is also happy that I am doing the legwork on it

 

[JohnRM]

Quote:
Originally Posted by JohnRM
Am I misunderstanding how that works? So, If President Biden takes away the stepped-up basis provision,....









I really must take issue with this part of your post. It is Congress that writes and passes tax laws, including any law that would affect the step up basis on inherited assets. The President can only sign or veto what Congress passes. And, in any event, I am unaware that the Biden Administration is advocating elimination of the step up basis.
---------------------------------------------------------------------
I did not mean that as an attack on Biden. However he has proposed eliminating stepped-up basis to help pay for student-loan forgiveness, according to whatever sources Snopes uses;


https://www.snopes.com/fact-check/biden-stepped-up-capital-gains/


Personally I don't think it will happen. I was just replying to the original post that started this thread, which referred to stepped-up basis and I assumed he was talking about this.

 

[mickeyd]

I shared our IRS with disinterested DW. Made her ask questions etc. We both signed IPS. We review it annually and sign it again (not for me, but for her). It's a process for us and finally she gets it!

 

[Gumby]

...
I did not mean that as an attack on Biden. However he has proposed eliminating stepped-up basis to help pay for student-loan forgiveness, according to whatever sources Snopes uses;


https://www.snopes.com/fact-check/biden-stepped-up-capital-gains/


Personally I don't think it will happen. I was just replying to the original post that started this thread, which referred to stepped-up basis and I assumed he was talking about this.

My issue with the post is not that it is an attack on Biden or even whether eliminating the stepped up basis is a good idea. It is, rather, a concern for accuracy in describing the workings of the government. If we say "the President will do _____" when doing ____ requires changing the law, we are ignoring the form of government specified in Constitution - Congress writes and passes the laws, the President vetoes them or signs them and then sees that they are carried out. Phrasing it as "the President will do ____" validates a dangerously excessive concentration of power in the Executive branch and permits Congress to abdicate its responsibilities, to the detriment of our nation. Inaccurate language leads to inaccurate thinking. This is true regardless of who may be president at the time.

I was unaware that candidate Biden had advocated for elimination of the stepped up basis during the campaign. Thank you for informing me. Although, like you, I think it will never happen.

 

[pdxgal]

OP, have your wife look at latest issue of AARP's monthly newsletter (if you get it). There's a cautionary real life story of a woman who was happy to let her husband handle all the finances. Then husband starting developing dementia and she had to take over. By then it was too late. She ended up losing the house and broke.

 

[Morricol61]

So I was talking to my wife this afternoon about step up basis and what that means if I die or her mom dies. We must have been talking for 2 or 3 minutes when I look over at her and she is pulling her nostrils apart with her index fingers. Then she says to me "you know, if I pull my nostrils apart, I can smell the cheese I just ate!" She's not very interested in our finances.

The cheese smell probably came from her fingers.

 

[deserat]

Excellent thread.

I am single now, but when I was married, we sort of split the finance duties. Interestingly, one of our first conversations when we met was about finances. He was deep in debt but seemed to think if he bought the right stock he would hit it rich, pay off all of his debts and all would be good. Fast forward and we got married, he found out my net worth at that time and started asking how I had done that. We compromised in that he could have some 'play' money to be 'killer stock picker' but that the bulk would be invested in a certain way, automated and re-balanced as necessary. All credit cards would be paid off every month, loans would be minimized and savings maximized. We had a plan for early retirement and looked at it in stages as the different streams of income turned on/off.

I also do and did the taxes by hand - he would then review them. He complained a few times about just using someone to do them, but he realized the last time he reviewed them how I had saved us quite a bit and was fairly good at it even with some complicated situations.

He liked to chase the credit card deals/points/CD interest rates - I cared more about the bigger picture. I calculated what our expenses were every year and by category and would 'report out' that info to him. We were fortunate in that we never had financial issues and there was enough extra to handle some of the obscure things like step-children and ex spouse issues.

I still manage everything, of course, but lately have been looking to simplify my situation even more. I don't have a written IPS, but a general philosophy (Boglehead-ish - used to be Motley Fool Four-ish) that I've maintained over the years. As I can see here, I need to write down a list of where everything is, how to get there and make sure my executor has that info....

 

[ychuck46]

Same here

Yeah, In my case it's not going to work either. While I cherish her, future finances are a wild card upon my demise. Although she does have a enough foresight to veto any annuities.

I have exactly the same issue with my wife. Her reply is always that I just need to make sure I outlive her. And hopefully she feels the same about annuities since she has heard me disparage them enough.

 

[PatrickW]

DW has gotten into the habit of portraying us as being wealthier than we are, especially when she's been drinking.

It worries me.

If we were rich, I wouldn't want people to know. And since we're NOT rich, I don't want people to think we are. That's just asking for trouble.

 

[Andromeda]

My husband and I both have aptitudes (and complementary skill sets) for handling our finances. I'm the capital markets lawyer (and ex-regulator), and he's a whizz at numbers and tech. I passed Level of my CFA many years ago, and persuaded him to do the same. Add to that an engineer father (on my side) whose idea of heaven is building spreadsheets, and we're in pretty good shape.

But for those of you with a significant other who doesn't seem interested in your finances, have you considered that: a) maybe it's how you're approaching the topic; and b) if there is a serious level of disinterest, how problematic this could be in the future?

For example, if my husband comes to tell me about some kind of tech issue relevant to both of us, while I'm sitting on the couch reading law journals (or Bridgerton novels), my eyes are likely to glaze over. But if he said, "I think we should discuss our tech security plans [or the basement waterproofing, or something else I'm not that interested in] because [insert reason]. When is a good time for us to have this discussion?", then I'd be more likely to want to participate in the conversation. And similarly, when I want to talk about the minutiae of our retirement financial plans, I schedule time with him for it.

If your spouse doesn't want to have that conversation, ask them (in a non-judgmental way) why they feel that way. You could then explain why you want to discuss the topic and, hopefully, if you understand each other better, then you can have the discussions you need.

 

[Lienlord]

My issue with the post is not that it is an attack on Biden or even whether eliminating the stepped up basis is a good idea. It is, rather, a concern for accuracy in describing the workings of the government. If we say "the President will do _____" when doing ____ requires changing the law, we are ignoring the form of government specified in Constitution - Congress writes and passes the laws, the President vetoes them or signs them and then sees that they are carried out. Phrasing it as "the President will do ____" validates a dangerously excessive concentration of power in the Executive branch and permits Congress to abdicate its responsibilities, to the detriment of our nation. Inaccurate language leads to inaccurate thinking. This is true regardless of who may be president at the time.

I was unaware that candidate Biden had advocated for elimination of the stepped up basis during the campaign. Thank you for informing me. Although, like you, I think it will never happen.

So having said that, ObamaCare isn't really ObamaCare and the Trump Tax Cuts aren't really the Trump Tax Cuts.
Can we call them PelosiCare and the McConnell Tax Cuts?

But as to the OP issue, my DW also doesn't seem interested in our financial dealings. But my DS is a Finance grad (like me), and his DW is a CPA. So hopefully they can make sense of the mess I've created! LOL!

 

[Gumby]

So having said that, ObamaCare isn't really ObamaCare and the Trump Tax Cuts aren't really the Trump Tax Cuts.
Can we call them PelosiCare and the McConnell Tax Cuts?
...

I have never called them that and never will. Virtually every law passed has an actual name specified in the law. In this case, they are the Patient Protection and Affordable Care Act (Pub. L. 111-148) and the Tax Cuts and Jobs Act of 2017 (Pub. L. 115-97). If I need to refer to them colloquially, I will call them the ACA or the 2017 tax cuts. Laws don't belong to any particular person, regardless of their position in the government.

 

[Koolau]

We have a current thread on bacon. I like the current discussion about "Talking to my wife about finances." Mixing in the smell of bacon could derail us on this topic. Returning you now to our regularly scheduled discussion.

 

[flyboy541]

Live and learn

My X wife 25 years ago couldn't balance the check book to save her soul, her job was to pay bills. I tried to keep her informed of every investment. Along came the divorce, she said in the divorce papers I blocked her and hid all investments. I was making good money and last two years, every month she said we had to dip into savings to pay monthly bills. She was skimming. Divorce took two years and during this time I went on a cash system. More money going out, alimony, less money coming in. I put every extra dollar in a shoe box under the bed. I didn't count it until the divorce papers were signed. $38,000. Never commingle your money. I have a perfect wife now. Commingle my $12,000,000 in investments. Never.

 

[albundyz]

I find this thread hilarious. Once I showed my wife a spreadsheet as follows:

amount in checking accout....................xxx

(the "adds")
monthly SS deposit (fixed)...................xxx
monthly pension (fixed).......................xxx

(the subtracts)
monthly mortage (fixed)....................-xxx
utilities (one line guess).....................-xxx
food (one line estimate).....................-xxx

(do we have enough $$ this month?)
net..................................................xxx

She said "Too complicated, what's on TV tonight?"

geez, I tried to make it as simple as possible. ugh, I gave up.

 

[Green Papaya]

DW is smart, she handles all bills and CC. She sets up auto phone notices whenever there is a new charge on our CC, and moves cash around to take advantages of account balance incentives. But she was terrified about retirement and had no idea how much is enough.
She heard her friends going to talk to Fidelity about retirement and wanted us to do same. I tried to convince her that I had already covered all their talking points and do not want to waste my time. I gradually tried to talk to her on our daily walk, things like kids finances, IRA, Roth conversion, RMD, where to get money for our new house, etc. Not all at once, but one topic at a time. Fortunately, she is beginning to turn around and relax a little bit about our finances.
She checked her IRA account last month and it achieved a second comma. Then she became excited that we are finally millionaires (on paper).

 

[digger1959]

I think most of you guys are being conned

Managing the household finances is not that interesting so if you have someone you trust to do it for you...why not? I am pretty sure that is why my genius engineer husband lets me do it...