Author Topic: Taking on Debt with Marriage Advice  (Read 4244 times)

chris316

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Taking on Debt with Marriage Advice
« on: April 14, 2017, 05:23:20 PM »
Somebody please talk to me about taking on debt when planning or thinking about marriage and things of this nature.

englishteacheralex

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Re: Taking on Debt with Marriage Advice
« Reply #1 on: April 14, 2017, 05:55:26 PM »
Need more info!

In a generalized way:

There are lots of different ways of dealing with finances as a married couple. I start with an acknowledgement of there being more than one way to skin a cat on this. Different philosophies work for different circumstances.

Now that that's out of the way, here's how I look at finances in marriage--a philosophy gleaned from a lot of reading and 3.5 years of experience on the subject.

I think marriage works best when you see yourself as a team working together towards shared goals and values. Money is a reflection of goals and values, so it makes sense to share money...all of it; assets, debts, income, everything. If you don't feel comfortable with total transparency and a total feeling of OURS instead of HIS/HERS, marriage is going to be a lot more challenging.

So if you see a potential spouse who is saddled with debt, you have to be prepared for that debt to become your problem as well as theirs. It's going to become "OUR debt" not "His/Her debt". And that can either be a big red flag, or it can be an opportunity to realize you have your own issues that the person will have to take on as your teammate, and nobody's perfect, yourself included.

My story: I was single and mustachian for a long time, albeit with a small income. I built up a net worth of around $40k by the time I was thirty, with no debt. $40k isn't that much around these parts, but it took a lot of work and discipline for me to get there on my salary, and I was pretty proud of it.

Met my husband at 32. He had a couple thousand dollars of credit card debt, a 10k car loan, and about 45k in student loans. Not so awesome. We dated for a year, and during that year I saw him using budget applications on his phone, paying off his credit cards, and thoroughly enjoying all my cheapskate activities. He would talk to me for hours about investing and budgeting, sinking funds, asset allocation, all kinds of things. Conspicuous consumption interested him less and less.

He paid off his credit card debt and saved up for a month or two to buy me a modest engagement ring with cash. I knew about his student loan and I was ok with it. The week after we got back from our honeymoon we went to the bank and I wrote a check for the rest of his car loan. Then we sold his car and bought a 2.5k 1999 Corolla--same car as I had! We're banking on the federal student loan forgiveness program for the student debt in 2020. If the government renegs on that, we'll just write a check and pay it off--we have the cash on hand. We did the math and doing the forgiveness program saves us about 10k over paying it off tomorrow, so that's the route we're taking. Anyway...

Since I married my husband, our net worth has increased an average of 45k/year, and that's with two kids who came within the last 3.5 years. He makes pretty good money (the student loan had a good ROI). We budget together and love finding ways to save money together.

In his case, his debt bothered me a little bit when we were dating, but I knew his character wasn't reflected in the debt and I was ok signing up for paying it off with him. I could tell we could work together and it would just be a minor blip. He took it as seriously as I did.

Now, if he had only had 10k in debt but was really into driving super cool cars and wearing cool clothes and eating out all the time (like the guy I dated before him), I'd probably not have wanted to marry him. The dollar amount on the debt is less important than the character of the person.

Still--need more info. YMMV. 

chris316

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Re: Taking on Debt with Marriage Advice
« Reply #2 on: April 14, 2017, 08:07:48 PM »
Here Is my case study...

https://forum.mrmoneymustache.com/case-studies/case-study-wild-card-situation/

My gal pal and I have been together for over 3 years.
I'm 29 and she's 31.
She has about 38k of student debt.
And is at a solid job at about 43k a year gross.
We want to retire at 60

she understands our goals and is doing $700 a month for 5 years at about 3.4%
I have enough savings to pay off a massive chunk of that debt.
but we live in a 1000ft2 place with a roommate.... not ideal...

Buy house to get away from roommate? or pay off student debt??.....

I know we'll get more ROI on paying off the student debt... but from everything I'm hearing about the housing market, the time is now to buy cause in the next 1-2 years interest rates are predicted to rise... if you buy now your home value could trend upwards with the market... and we definitely do not want to rent for 2 more years! maybe 1 more year...

We want to live independent and alone and pay off student loans but cant do both at the same time.

With all of this said it sounds a lot like your situation Alex. thanks

Please tell me more about this federal student loan forgiveness.....???

englishteacheralex

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Re: Taking on Debt with Marriage Advice
« Reply #3 on: April 14, 2017, 08:25:25 PM »
The federal student loan forgiveness program started in 2007 and has to do with being employed in a 501(c)3 company or other qualified employer (it's all public service type employers, the idea is to offer the loan forgiveness to entice people to work for non-profits and government agencies). My husband is a social worker for the VA, so that counts. There are several things you have to do to qualify for the program, one of which is paying 120 consecutive on-time payments. After 10 years of working for a qualified employer and making your payments, if the loan is a federal direct loan, supposedly the government will pay the rest.

The first people to qualify for this program will get their loans cancelled in October of this year. We're waiting to see if it actually happens. It's a controversial program and people are pretty worried that congress will cut it.

As for buying a house to get rid of the roommate...

I'm pretty meh on buying a house. Not too concerned with interest rates rising because I don't make decisions based on future unknowns. Renting isn't awesome in some ways, but in other ways it has a lot going for it. I don't see why you couldn't just rent a smaller, cheaper place without a roommate. Why do you have to buy a place to not have a roommate?

I rented apartments for 14 years, the last two of which were with my husband. When the math and our circumstances permitted it, we bought a relatively cheap condo. We have two kids in 900 square feet and it's working fine for us. It's nice to own our place, but it wouldn't have been worth any kind of financial pain to have done it.

If you can find a place to buy that would have a sensible house payment relative to your income (25-30% is ideal), you have a 3-6 month emergency fund, and you don't plan on moving soon (within the next 5 years, preferably longer), it makes sense to buy. Even with a student loan, in my opinion. But if all that stuff isn't there, it doesn't make sense to buy. Don't fall prey to a false sense of urgency with interest rates or the market. Buy when it makes sense for you.

Lastly, I would marry this person before thinking about buying a house with them. But that's just me. Making a huge financial commitment with someone who could break up with you terrifies me. Yeah, if you're married they could always divorce you, but at least then you have some kind of legal recourse.

SwordGuy

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Re: Taking on Debt with Marriage Advice
« Reply #4 on: April 14, 2017, 08:38:33 PM »
Most people do not buy a house on price, they buy it on the payment.

When interest rates go up, prices go down because the payment buyers can afford hasn't changed.

So, although housing prices may go up, I don't think they'll go up due to rising interest rates.

In fact, you might get more foreclosure choices due to all the financially illiterate who bought adjustable rate mortgages and couldn't afford the new, higher payments.

If you're interested in getting a house, learn how to buy one at wholesale prices instead of retail prices.   The same techniques that real estate investors use to find good properties to buy work for buying your own home, too.   

It takes some time to learn how, and to practice it, to learn your market, and to find one or more potential deals.   But the savings can be pretty big. 

Examples:

Rental #1:  bought for $38,400, repair costs got the total cost up to about $45,000.  House is worth $80,000.   44% savings.

Rental #2:  bought for $37,000, repair costs got the total cost up to about $50,000.  House is worth $80,000.   37.5% savings.

Rental #3:  bought for $33,000, repair costs expected to raise total cost to $48,000.  House is worth $90,000 when repaired.  47% savings.

Personal House:  bought for $227,500, repair costs of about $10,000.  Appraised at  about $320,000.   Had to wait 3 years for this to reach the price I wanted.  (This was one of 6 houses we were keeping our eye on as a potential replacement for our old home.)  26% savings.

Flip #1:  bought for $101,000.   Will take between $100,000 and $150,000 and a lot of work to get in awesome shape.   Will be worth about $350,000 when we're done.   And there are way better flipping deals out there, but we wanted to save this particular architectural gem.  Had to wait 4 years before this one hit our price.   We would have moved into this one if we hadn't gotten our new personal house first.  28% to 49% savings, depending on the costs and the tax credits (it should qualify as an historic restoration with some hefty tax credits).

That's a damn site better than buying at 100% (or higher!!) than retail.  Of course, in some markets that will be a whole lot harder.



chris316

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Re: Taking on Debt with Marriage Advice
« Reply #5 on: April 14, 2017, 09:14:16 PM »
I agree.
The thing about the roommate is as of lately he has been acting like an anchor in cleaning, chores, attitude, and things like that...
Eventually we would like to start a family, our lives, and be alone... our rent is cheap with our roommate for the HCOL area were in, but at what cost?... we could rent for 1 more year for sure and I guess take it day by day then.. we're on  month to month basis...

As for buying together I've heard that splitting up a house is more difficult than a divorce??
is this true?
I was planning on just buying the house and she would act as a renter, even if we married.

In a lot of way we already act as married... we take turns on groceries, share a car, and I'm even listed as "domestic partner" on her health insurance...

I've talked to a friend that is married and said there are no tax benefits or really any benefits to being married.
Is this true?

GizmoTX

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Re: Taking on Debt with Marriage Advice
« Reply #6 on: April 15, 2017, 07:08:31 AM »
Marriage is a contract & legal commitment. Without marriage you need a contract if singles buy property together, detailing what happens to ownership if they split. With marriage, neither spouse should be a renter, IMO. Lose the roommate. There can be a "marriage tax" so you wouldn't necessarily save money, but the advantages to the relationship & to children outweigh not being married.

maizefolk

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Re: Taking on Debt with Marriage Advice
« Reply #7 on: April 15, 2017, 07:31:18 AM »
Most people do not buy a house on price, they buy it on the payment.

When interest rates go up, prices go down because the payment buyers can afford hasn't changed.

So, although housing prices may go up, I don't think they'll go up due to rising interest rates.

Agreed. A lot of the conventional wisdom on housing prices comes from people who have lived their entire adult lives (or entire lives) in a world of falling mortgage rates. Mortgage rates have been falling pretty consistently since 1982, before I was even born.



If rates get back up around 6-7% a $1000/month payment that currently pays for a $200k mortgage at 4% would only support a $150,000 mortgage (7%).

I'm not sure what running the numbers would indicate, but taken in isolation* I think I'd rather buy a cheap house with a higher interest mortgage than an expensive house with a low interest rate mortgage. If nothing else, it'd mean I'd need to liquidat less of my stocks to pay off the mortgage if I ever needed to.

OP, I'm not familiar with the the law in whatever state you live in, but I suspect "I was planning on just buying the house and she would act as a renter, even if we married" will not fly if and when you (plural) buy a house. By which I mean you can do that if you like, but it would be extremely unlikely that in the event of a divorce the house wouldn't be regarded as a joint asset anyway. Maybe I misunderstood your point.

*High interest rates have other effects I'm not so thrilled about, like increasing how much of government budgets at the local, state, and federal level are diverted to debt service, but that is extremely off topic for this thread.

milliemchi

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Re: Taking on Debt with Marriage Advice
« Reply #8 on: April 15, 2017, 07:36:25 AM »
Just to point out... As interest rates go up, the prices trend down, as people can only afford so much to pay each month. Ideally, you buy when the rates are really high. Then, as the rates go down, you can refinance to a lower payment while your home increases in value. If you buy when the rates are low, the opposite holds.

If you buy a house in your name before you marry, you can likely keep it in case of divorce, as it was property brought into marriage (or as much as you had in equity). If you buy it after you marry, it will be shared, unless you keep your finances separate, and can show that you paid all the bills and your spouse contributed nothing or almost nothing. (My friend actually lived through the second scenario, this is part of why they're divorced now, and kept the house.)

Bracken_Joy

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Re: Taking on Debt with Marriage Advice
« Reply #9 on: April 15, 2017, 08:00:56 AM »
I agree.
The thing about the roommate is as of lately he has been acting like an anchor in cleaning, chores, attitude, and things like that...
Eventually we would like to start a family, our lives, and be alone... our rent is cheap with our roommate for the HCOL area were in, but at what cost?... we could rent for 1 more year for sure and I guess take it day by day then.. we're on  month to month basis...

As for buying together I've heard that splitting up a house is more difficult than a divorce??
is this true?
I was planning on just buying the house and she would act as a renter, even if we married.

In a lot of way we already act as married... we take turns on groceries, share a car, and I'm even listed as "domestic partner" on her health insurance...

I've talked to a friend that is married and said there are no tax benefits or really any benefits to being married.
Is this true?

This is a little bit "alarm bells" for me. You would make your WIFE rent from you? Even for people with separate finances, that's really extreme. You're then essentially forcing her to choose between being with you and the opportunity to build her own equity in a home.

I've read all your posts on both threads, and to be honest, it really feels like you do not get the concept of a TEAM.
Will you force your children to rent from you?
Will you pay your wife rent for using her womb, and endangering her health to carry your children?

I get that there are a lot of ways to do finances, but the degree to which you see your lives as separate doesn't bode well.

chris316

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Re: Taking on Debt with Marriage Advice
« Reply #10 on: April 15, 2017, 08:06:40 AM »
Interesting graph!!!

I assume that buying a house pre-marriage could be included in a pre-nup????

So say we get a prenup, and marry and then I pay off her student loans....
then the unthinkable happens and we divorce....
at that point could she be on the hook for paying me back the amount I payed off her student loans??

I'm just thinking about protecting myself. I understand I'll get a lot of "punches in the face" or people saying "you shouldn't even marry her if you think like that."

does anybody have any advice on a prenups??

maizefolk

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Re: Taking on Debt with Marriage Advice
« Reply #11 on: April 15, 2017, 08:17:05 AM »
So say we get a prenup, and marry and then I pay off her student loans....
then the unthinkable happens and we divorce....
at that point could she be on the hook for paying me back the amount I payed off her student loans??

I am not a lawyer, but my best guess would be: nope.

Assets get divided. Debts get divided. A student loan is a debt without a corresponding asset so once you pay it off it would just be gone.

Bracken_Joy

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Re: Taking on Debt with Marriage Advice
« Reply #12 on: April 15, 2017, 08:24:45 AM »
So let's talk certain risk vs theoretical risk.

If you get married, and you do NOT pay off her loans, but stay married long term, this is the cost:
-Higher stress on her part because of the cloud over her head
-You pay more money in interest
-Under your 'protect myself' system, you MUST keep all assets and numbers separate- I'm not positive, someone can correct me on this, but I believe that can require filing separately? So potential for tax inefficiencies there, particularly since it sounds like there is an income disparity.
-If you're dead set on separate finances, then there is no option for a stay at home parent, since both of you have to have your own earnings
-Similar to above, what opportunities are you giving up? I took a lower paying, more flexible job for quality of life, and put most of it in my 401k. This works, since it makes our taxes waaaaay nicer looking. If Future Wife has to bring her own money to the table every month, she can't optimize for the team

Whereas the gain is a POSSIBLE risk that you will lose some money you put into better the team, that benefits her more than you.

I'm sorry, but I really am not sure marriage is a good plan for you yet. I'm not anti-prenup, but I AM worried about the psychology that is leading you there.

chris316

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Re: Taking on Debt with Marriage Advice
« Reply #13 on: April 15, 2017, 08:32:22 AM »
I agree.
The thing about the roommate is as of lately he has been acting like an anchor in cleaning, chores, attitude, and things like that...
Eventually we would like to start a family, our lives, and be alone... our rent is cheap with our roommate for the HCOL area were in, but at what cost?... we could rent for 1 more year for sure and I guess take it day by day then.. we're on  month to month basis...

As for buying together I've heard that splitting up a house is more difficult than a divorce??
is this true?
I was planning on just buying the house and she would act as a renter, even if we married.

In a lot of way we already act as married... we take turns on groceries, share a car, and I'm even listed as "domestic partner" on her health insurance...

I've talked to a friend that is married and said there are no tax benefits or really any benefits to being married.
Is this true?

This is a little bit "alarm bells" for me. You would make your WIFE rent from you? Even for people with separate finances, that's really extreme. You're then essentially forcing her to choose between being with you and the opportunity to build her own equity in a home.

I've read all your posts on both threads, and to be honest, it really feels like you do not get the concept of a TEAM.
Will you force your children to rent from you?
Will you pay your wife rent for using her womb, and endangering her health to carry your children?

I get that there are a lot of ways to do finances, but the degree to which you see your lives as separate doesn't bode well.

opps!!! sorry, I made an error... I didn't mean it like that...

Pretty much I'm new to the whole marriage thing and want to make sure I'm prepared for everything when and if I decide to pull the trigger in the  near future....
I want to protect myself
and also want to be a team...
but I also feel marriage is not only about equity but more about equality... and pretty much just have to accept that certain things will not be equal...
I think EnglishteacherAlex hit the nail on the head with her posts...

Also Bracken_joy - I understand what you're saying
so what do you think is the best way to do finances as a couple in my/our situation?
or any other advice would be greatly appriciated

Bracken_Joy

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Re: Taking on Debt with Marriage Advice
« Reply #14 on: April 15, 2017, 08:38:27 AM »
I agree.
The thing about the roommate is as of lately he has been acting like an anchor in cleaning, chores, attitude, and things like that...
Eventually we would like to start a family, our lives, and be alone... our rent is cheap with our roommate for the HCOL area were in, but at what cost?... we could rent for 1 more year for sure and I guess take it day by day then.. we're on  month to month basis...

As for buying together I've heard that splitting up a house is more difficult than a divorce??
is this true?
I was planning on just buying the house and she would act as a renter, even if we married.

In a lot of way we already act as married... we take turns on groceries, share a car, and I'm even listed as "domestic partner" on her health insurance...

I've talked to a friend that is married and said there are no tax benefits or really any benefits to being married.
Is this true?

This is a little bit "alarm bells" for me. You would make your WIFE rent from you? Even for people with separate finances, that's really extreme. You're then essentially forcing her to choose between being with you and the opportunity to build her own equity in a home.

I've read all your posts on both threads, and to be honest, it really feels like you do not get the concept of a TEAM.
Will you force your children to rent from you?
Will you pay your wife rent for using her womb, and endangering her health to carry your children?

I get that there are a lot of ways to do finances, but the degree to which you see your lives as separate doesn't bode well.

opps!!! sorry, I made an error... I didn't mean it like that...

Pretty much I'm new to the whole marriage thing and want to make sure I'm prepared for everything when and if I decide to pull the trigger in the  near future....
I want to protect myself
and also want to be a team...
but I also feel marriage is not only about equity but more about equality... and pretty much just have to accept that certain things will not be equal...
I think EnglishteacherAlex hit the nail on the head with her posts...

Also Bracken_joy - I understand what you're saying
so what do you think is the best way to do finances as a couple in my/our situation?
or any other advice would be greatly appriciated

I think you need to give up some of your fear. On the deepest levels, you CANNOT protect yourself. Yes, maybe you can protect some of your assets (although pre-nups count for very little within many courts, so even that is debatable). But you cannot protect yourself in the deepest ways. Marriage is about vulnerability, and unity, and trust. Divorce, therefore, will involve broken trust, disunity, and that terrible feeling when you have been vulnerable and it has gone awry. No pre-nup will protect you from that. If you are not ready to be that vulnerable, then you should not get married yet.

Here is a book I send every single one of my friends when they get engaged. I highly recommend going through this with your prospective spouse: https://www.amazon.com/Hard-Questions-100-Ask-Before/dp/1585426210

There are similar lists you can find online, but I do really like the book in particular.

chris316

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Re: Taking on Debt with Marriage Advice
« Reply #15 on: April 15, 2017, 09:06:44 AM »
Sounds good!
Thanks Bracken_Joy

Also what do think about this one?

https://www.amazon.com/101-Questions-Ask-Before-Engaged/dp/0736913947/ref=pd_bxgy_14_img_3?_encoding=UTF8&pd_rd_i=0736913947&pd_rd_r=A9X8D2MDZ28ZHYGXS11Z&pd_rd_w=d545d&pd_rd_wg=1GXgw&psc=1&refRID=A9X8D2MDZ28ZHYGXS11Z

Since technically we aren't even engaged yet?

I've thought a lot about it and have figured that we will become stronger financially as a team... I'm just trying to see if there has been anyone out there that might have had similar situations to input some encouraging advice to help me feel better and such.

Bracken_Joy

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Re: Taking on Debt with Marriage Advice
« Reply #16 on: April 15, 2017, 09:17:43 AM »
Sounds good!
Thanks Bracken_Joy

Also what do think about this one?

https://www.amazon.com/101-Questions-Ask-Before-Engaged/dp/0736913947/ref=pd_bxgy_14_img_3?_encoding=UTF8&pd_rd_i=0736913947&pd_rd_r=A9X8D2MDZ28ZHYGXS11Z&pd_rd_w=d545d&pd_rd_wg=1GXgw&psc=1&refRID=A9X8D2MDZ28ZHYGXS11Z

Since technically we aren't even engaged yet?

I've thought a lot about it and have figured that we will become stronger financially as a team... I'm just trying to see if there has been anyone out there that might have had similar situations to input some encouraging advice to help me feel better and such.

Well, the one I linked definitely applies before engagement too. It's about values, and lifestyle, not about the wedding at all. So really, it would benefit any stage of a serious relationship. My husband and I have gone back through a couple times on road trips since getting married, to do a check in and see if any answers have changed =)

As for the question, there have been some awesome threads on this before. I'll link some.
https://forum.mrmoneymustache.com/ask-a-mustachian/why-do-married-couples-have-separate-bank-accounts-andor-'split'-costs/
https://forum.mrmoneymustache.com/ask-a-mustachian/combining-finances-after-marriage/
https://forum.mrmoneymustache.com/ask-a-mustachian/best-way-to-structure-finances-once-married/
https://forum.mrmoneymustache.com/ask-a-mustachian/separate-finances-and-marriage-vows/
https://forum.mrmoneymustache.com/welcome-to-the-forum/how-does-seperate-financial-account-save-your-marriage/

Even if you don't get many answers here, you can hopefully glean some help from those in the meantime =)

chris316

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Re: Taking on Debt with Marriage Advice
« Reply #17 on: April 15, 2017, 09:53:24 AM »
Sounds good!
Thanks Bracken_Joy

Also what do think about this one?

https://www.amazon.com/101-Questions-Ask-Before-Engaged/dp/0736913947/ref=pd_bxgy_14_img_3?_encoding=UTF8&pd_rd_i=0736913947&pd_rd_r=A9X8D2MDZ28ZHYGXS11Z&pd_rd_w=d545d&pd_rd_wg=1GXgw&psc=1&refRID=A9X8D2MDZ28ZHYGXS11Z

Since technically we aren't even engaged yet?

I've thought a lot about it and have figured that we will become stronger financially as a team... I'm just trying to see if there has been anyone out there that might have had similar situations to input some encouraging advice to help me feel better and such.

Well, the one I linked definitely applies before engagement too. It's about values, and lifestyle, not about the wedding at all. So really, it would benefit any stage of a serious relationship. My husband and I have gone back through a couple times on road trips since getting married, to do a check in and see if any answers have changed =)

As for the question, there have been some awesome threads on this before. I'll link some.
https://forum.mrmoneymustache.com/ask-a-mustachian/why-do-married-couples-have-separate-bank-accounts-andor-'split'-costs/
https://forum.mrmoneymustache.com/ask-a-mustachian/combining-finances-after-marriage/
https://forum.mrmoneymustache.com/ask-a-mustachian/best-way-to-structure-finances-once-married/
https://forum.mrmoneymustache.com/ask-a-mustachian/separate-finances-and-marriage-vows/
https://forum.mrmoneymustache.com/welcome-to-the-forum/how-does-seperate-financial-account-save-your-marriage/

Even if you don't get many answers here, you can hopefully glean some help from those in the meantime =)

Whoa.
awesome resource list.

between all of that Info included with this...

https://forum.mrmoneymustache.com/ask-a-mustachian/how-to-convert-your-so-to-mmm-in-50-awesome-steps/

that should be plenty to read and prepare...

I have an extremely difficult time making an affirmative decision on everything I do.... even if its chicken or beef for dinner or product A or product B... Its good but not good because I feel like being on the fence for some things im really able to dissect, investigate, research and make the best possible informed decision, but also I feel like I've lost good opportunities, usually I get over it quickly though and move forward with what I decided.

So for me Marriage and a House are the biggest decisions ever...

Bracken_Joy

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Re: Taking on Debt with Marriage Advice
« Reply #18 on: April 15, 2017, 09:58:32 AM »
Sounds good!
Thanks Bracken_Joy

Also what do think about this one?

https://www.amazon.com/101-Questions-Ask-Before-Engaged/dp/0736913947/ref=pd_bxgy_14_img_3?_encoding=UTF8&pd_rd_i=0736913947&pd_rd_r=A9X8D2MDZ28ZHYGXS11Z&pd_rd_w=d545d&pd_rd_wg=1GXgw&psc=1&refRID=A9X8D2MDZ28ZHYGXS11Z

Since technically we aren't even engaged yet?

I've thought a lot about it and have figured that we will become stronger financially as a team... I'm just trying to see if there has been anyone out there that might have had similar situations to input some encouraging advice to help me feel better and such.

Well, the one I linked definitely applies before engagement too. It's about values, and lifestyle, not about the wedding at all. So really, it would benefit any stage of a serious relationship. My husband and I have gone back through a couple times on road trips since getting married, to do a check in and see if any answers have changed =)

As for the question, there have been some awesome threads on this before. I'll link some.
https://forum.mrmoneymustache.com/ask-a-mustachian/why-do-married-couples-have-separate-bank-accounts-andor-'split'-costs/
https://forum.mrmoneymustache.com/ask-a-mustachian/combining-finances-after-marriage/
https://forum.mrmoneymustache.com/ask-a-mustachian/best-way-to-structure-finances-once-married/
https://forum.mrmoneymustache.com/ask-a-mustachian/separate-finances-and-marriage-vows/
https://forum.mrmoneymustache.com/welcome-to-the-forum/how-does-seperate-financial-account-save-your-marriage/

Even if you don't get many answers here, you can hopefully glean some help from those in the meantime =)

Whoa.
awesome resource list.

between all of that Info included with this...

https://forum.mrmoneymustache.com/ask-a-mustachian/how-to-convert-your-so-to-mmm-in-50-awesome-steps/

that should be plenty to read and prepare...

I have an extremely difficult time making an affirmative decision on everything I do.... even if its chicken or beef for dinner or product A or product B... Its good but not good because I feel like being on the fence for some things im really able to dissect, investigate, research and make the best possible informed decision, but also I feel like I've lost good opportunities, usually I get over it quickly though and move forward with what I decided.

So for me Marriage and a House are the biggest decisions ever...

Well, paralysis by analysis on daily things is not good, but common. But I think seeing a home and marriage as Big is a good thing. They are Big. I would voucher more people get in trouble leaping before looking than over-analyzing on these things.

Have you considered counseling? This is exactly the sort of thing it can be fantastic for. Help you analyze your views, hangups, assumptions underlying all of it.

chris316

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Re: Taking on Debt with Marriage Advice
« Reply #19 on: April 15, 2017, 10:23:05 AM »

I think marriage works best when you see yourself as a team working together towards shared goals and values. Money is a reflection of goals and values, so it makes sense to share money...all of it; assets, debts, income, everything. If you don't feel comfortable with total transparency and a total feeling of OURS instead of HIS/HERS, marriage is going to be a lot more challenging.

So if you see a potential spouse who is saddled with debt, you have to be prepared for that debt to become your problem as well as theirs. It's going to become "OUR debt" not "His/Her debt". And that can either be a big red flag, or it can be an opportunity to realize you have your own issues that the person will have to take on as your teammate, and nobody's perfect, yourself included.

The dollar amount on the debt is less important than the character of the person. 


^^^^^^^
Right here.

All of this above seems like the answers to my question...

Just a question though...
does your S/O ever feel like they're in debt to you now? like there is an overwhelming cloud over their head that they owe you forever?

Bracken_Joy

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Re: Taking on Debt with Marriage Advice
« Reply #20 on: April 15, 2017, 11:15:08 AM »

I think marriage works best when you see yourself as a team working together towards shared goals and values. Money is a reflection of goals and values, so it makes sense to share money...all of it; assets, debts, income, everything. If you don't feel comfortable with total transparency and a total feeling of OURS instead of HIS/HERS, marriage is going to be a lot more challenging.

So if you see a potential spouse who is saddled with debt, you have to be prepared for that debt to become your problem as well as theirs. It's going to become "OUR debt" not "His/Her debt". And that can either be a big red flag, or it can be an opportunity to realize you have your own issues that the person will have to take on as your teammate, and nobody's perfect, yourself included.

The dollar amount on the debt is less important than the character of the person. 


^^^^^^^
Right here.

All of this above seems like the answers to my question...

Just a question though...
does your S/O ever feel like they're in debt to you now? like there is an overwhelming cloud over their head that they owe you forever?

Oh! I can answer this one for us. When I finished nursing school, it was with $55k in debt. Which we have since busted ass, and paid down until there's ~$22k left, but it's all sub- 4.5% interest rate, so we're letting it ride (paying minimums).

Initially, I felt some guilt. But my husband is awesome, and he constantly thanks me for bringing him into frugality and introducing him to MMM and managing costs. He earnestly, and I believe honestly, insists that in spite of my debt and 'only' working part time, I contribute as much or more to our NW as he does. Because without me, he would spend a lot more, and wouldn't have pushed himself so much professionally, and certainly would not have bought a house at 28.

In short, no. I do not feel guilty. He does not feel resentful. BUT, we talk openly and often, do weekly check-ins, that sort of thing. I could see how it could be problematic for people who keep score. The type of people that know how many they vs their spouse has unloaded the dishwasher in the past week, that sort of thing. NO ONE wins at that game. We do not keep score.

englishteacheralex

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Re: Taking on Debt with Marriage Advice
« Reply #21 on: April 15, 2017, 11:19:56 AM »
Nope. His debt enabled him to make a pretty good salary. He needed a master's degree in order to get a well-paying job in his field; hence, the debt. One mental trick we do is just figure his salary as what it is minus the yearly debt payments. We mentally count it as sort of a business expense.

Another thing that makes me not feel like he owes me is the overwhelming evidence that he has all kinds of things to put up with from my end. I may not have come into the marriage with monetary debt, but I have plenty of other baggage and problems and he never holds them against me.

Lastly, there's more to life than money. I don't see our net worth as the be-all/end-all of our life together. He's a great partner and he works hard at his career and at home. He's making us breakfast right now; just got our son up and dressed while I was writing a comment on an internet stranger's thread, played with our four month old, and is singing in the kitchen. How could I hold a silly little student loan against this guy?

Finances_With_Purpose

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Re: Taking on Debt with Marriage Advice
« Reply #22 on: April 18, 2017, 05:51:19 PM »
Here Is my case study...

https://forum.mrmoneymustache.com/case-studies/case-study-wild-card-situation/

My gal pal and I have been together for over 3 years.
I'm 29 and she's 31.
She has about 38k of student debt.
And is at a solid job at about 43k a year gross.
We want to retire at 60

she understands our goals and is doing $700 a month for 5 years at about 3.4%
I have enough savings to pay off a massive chunk of that debt.
but we live in a 1000ft2 place with a roommate.... not ideal...

Buy house to get away from roommate? or pay off student debt??.....

I know we'll get more ROI on paying off the student debt... but from everything I'm hearing about the housing market, the time is now to buy cause in the next 1-2 years interest rates are predicted to rise... if you buy now your home value could trend upwards with the market... and we definitely do not want to rent for 2 more years! maybe 1 more year...

We want to live independent and alone and pay off student loans but cant do both at the same time.

With all of this said it sounds a lot like your situation Alex. thanks

Please tell me more about this federal student loan forgiveness.....???

I'm impressed by how much great input is already on this forum, and will pause here to second almost all of it, especially these parts: you must trust her, or don't marry her; deal w/your fear.  And, buy houses when prices are lower.  You can always refi.  Also, I wouldn't buy before marriage.  (I'm married now.)  You'll learn a ton about her from living with her the first year or two: maybe you need a separate space for yourself/home office, or maybe you two can live much more condensed than you imagine.  You'll have enough going on the first year w/o adding to it by also stacking on a huge, hard-to-change financial obligation with all the upkeep that comes along with it. 

Sounds like you two may want to have some big discussions with each other about these things, and you may want to really look into some of those resources and whether you truly trust this person (or are having difficulty trusting in general).  Your best way to be safe is to trust your wife - invest in her. 

If you try to do things separately, it'll ultimately hurt your unity and could lead down bad roads.  You two will be a team.  It's especially key to make sure you're working towards shared values/beliefs. 

There's no way to safeguard.  Even with pre-nups, the lawyers win.  She'll have ways to eat up your entire net worth in attorneys' fees out of spite if she wants.  There's not a lot you can do, especially at the level you're talking about.  Especially if you live in a community property state. 

Plus, pre-nups (I believe) are foundationally wrong: it's one spouse saying "I don't trust you with money" before you enter the marriage.  I get why some people do it, but I would want to trust someone with more than money before making the leap into marriage, so if it's that big of an issue, maybe take some time (and see the last paragraph below). 

For what it's worth, I worked like mad to pay off my student loans, then met a wife who still had some.  But her heart was in the right place, and she tried hard to pay them off long before we were married (even though I didn't care whether she did; she just thought it was a good plan).  The month we were married, we paid them off; it was a great investment for us.  And we've never looked back.  I care 1,000% more that she's financially responsible than whether or not I paid off some loan of hers. 

Once we're married, we realized (though we're still learning it!) that everything is now "ours" rather than hers or mine.  We're comfortable with that.  That view has helped immensely with eradicating conflict and selfishness (which is the root of many conflicts). 

Finally, some churches have great premarital counseling.  I strongly recommend doing that, and getting into it.  We did it and it was invaluable - and we didn't think it would be, as we had already asked a lot of tough questions.  There's a lot of that available (at least here) and worth looking into. 

Bottom line: you're doing the right thing, vetting your fears and concerns here and thinking things through first before leaping into a huge commitment.  Though, like others said, marriage is great and I highly recommend it before you get that financially intertwined, even though it's sometimes challenging.  The key is making sure you're working from the same values/beliefs and towards the same goals (or figure out/compromise on them!).  Best of luck to you!