The Money Mustache Community
Learning, Sharing, and Teaching => Ask a Mustachian => Topic started by: Northern gal on August 14, 2016, 01:58:03 PM
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I would usually hesitate to talk about loved one's mistakes so openly but this situation has caused me lots of grief and I'd appreciate some feedback.
Prelude: when DH and I met two years ago, he was flat broke and starting his own business. I have no issues with that - i don't need a provider, but do draw the line at paying someone's debt.
We both live in Australia. About 8 months in, we decided to go to Europe. He had always wanted to go, I wanted to show him where I am from. It was a great trip and I'm so glad we went when we did BUT I had always made clear, if we go for 5 weeks it will have to be low budget and he needs to pay his share.
While travelling, we quarrelled a lot over his spending ways. For example, he packed too much luggage then always wanted to catch cabs. Or he'd go to restaurants and order beers each night - I'm like let's buy stuff and drink at the hotel. In the end, he had to randomly borrow money off me and when we came back he owed me $3,000.
It took a few months and some nagging to get that money off him and it really put a strain on our relationship. At one stage I broke up with him over it.
It is not even the money as such that bothered me, it is the lack of foresight and disregard for himself and me. The thought of "if I do x then negative consequence y will happen to me." Never seems to cross his mind. Neither does the thought "bad consequence z will impact my wife." Then again, this is partly what attracts me to him, I am a planner and a worrier so he balances me out in a way? Other than this he is the most amazing guy with a heart of gold.
Anyway the main event: a year ago, during said short breakup, he bought a car. At the time he was driving a beaten up work car that was admittedly causing safety concerns (leaking tank). for whatever reason he decided to buy an almost new car on 5 year finance. I think he wanted to make himself feel better after the breakup. He asked me what I think about it, I said it is a really, really, really bad idea and sent him some links to read. He went and asked his mum (who has made many poor choices and spent most of her life on welfare) and she said "what a nice shiny car". At some stage he told me it was a zero finance loan and that it would help him get a credit rating to one day buy a house. I told him I really don't believe either but at this stage I was the ex and he is an adult and his mother is telling him to just get it....
So a week later we get back together again and I'm fuming he went ahead with the car loan. I told him look we are thinking of having a baby, you would be the stay at home parent and the key to achieving that is to reduce our living costs. this loan is a step in the wrong direction and let me be clear: I will not pay for it. He is like not a problem, he will get ahead on the payments so they are dealt with before kids.
A few months forward, we are getting married and I ask for a prenup. In his bit, he states the car is worth 30k and loan 30k.
The result:
So we got married, I fell pregnant and baby is due soon. I get three months paid leave and then we wanted for him to stay home. I kept asking him so what allowance do you think you'll need? And he kept being evasive. Partly because he eats out a lot, like twice or three times each day, which is an expensive and unhealthy habit he knows I loathe, but then finally a week ago comes the bummer. The car loan of course.
It turns out he signed up for a total liability of 60k for a car worth (at the time) 30k. I made him show me the paper work and was a bit shocked. 5 years on 16.5%. The break fee is really high too. To get out of the arrangement, they now quoted 43k when the car is now worth 20k. 4 years left on it. And they made it a business loan, so he signed away his consumer rights. Argh.
He has been stressing (& hiding it from me) for a while and I hate to see him like this. I want him to be happy. But I also want to reach FIRE and a free spending dependent isn't helpful. Note: in Australia, I am not liable for his debt and likely never will be (take my word for it, I've triple checked).
So my options are:
0. Refinance. Break fee too high, not worth it.
1. Pay it out. Pro: peace of mind, family approach. Con: I said I wouldn't. what if he does it again? And flame it that's a lot of money. Ouch! Plus I'd have to then get another car and pay for that.
2. Pay the instalments while DH stays home. Pro: good for our soon to be born son? Con: as above. And more expensive in the end.
3. Put the kid in child care so DH can continue working. Pro: no precedent of bailing him out, quicker to FIRE. Con: is that the best for our son? Will DH be able to make enough?
4. Call my mum for help, make her retire early, move to Australia and child mind (she was going to retire and do that in about a year).
5. Let him file bankruptcy and stay home. Pro: no precedent, facing up to consequences of his actions. Con: is it worth the trouble and stress to him for that amount? What crazy thing might such a big blow to his self esteem make him do? It feels mean.
6. Kill his mother (kidding. Not really.)
I have made him set up an appointment with a financial counsellor for later in the month to discuss his rights (payment plan, insolvency, bankruptcy).
Any thoughts would be appreciated.
I do love the guy and this is the main thing we fight about.
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First off, I would say that the main red flag for me here isn't the spending - it's that he lied to you about the loan. You need to make it absolutely clear that he can never lie to you about that sort of thing ever again.
I was in a somewhat similar situation before, except that my husband (then boyfriend) didn't lie about anything - he was just in medical debt and couldn't afford to pay it off. I helped him through a bankruptcy because even though I could have afforded to pay it off myself, I didn't want to set that precedent. Having no consequence to a bad decision isn't going to help him learn anything from the experience, and unless his credit is going to tank something related to the both of you (a house mortgage, maybe?) then there's no reason for YOU to take on the stress of paying it off just so that he can avoid the stress of going through a bankruptcy.
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I would not pay it off and help him look at his options.
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Norgirl, I have big concerns. A few questions:
Has your DH ever been financially independent - ie. worked a job, lived independent of others and paid bills and etc. on time? Did he accumulate any money or did he just lose only as much as the next windfall would cover? So far you have not told the story of a competent adult. Rather, you have described someone that wants, and takes, and has no grip on the toxic nature of debt.
I hear that you love him, but I am not clear on how you will achieve FIRE without him undergoing significant make over. Women that enter into relationships expecting that they can change their man are often disappointed.
I guess my opinion is that YOU cannot change him. So make the choices that put him in the realm of external consequences - bankruptcy or child care and work. If you rescue him and then expect him to get better... uh, I do not want to contemplate it.
Best wishes, Ap.
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Thank you MissWhipple and cassis for your replies. I feel really mean contemplating sending him into bankruptcy so you made me feel better.
As for lying, I don't want to sound like I make excuses for him, but I don't think he lied as such. It seems obvious to *US on MMM* that he got a very bad deal. I don't think it is necessarily obvious to people who sign such agreements what they are doing.
I don't think he truly understood what he was doing until way down the line. But I agree he should not be hiding things from me. And I am getting increasingly vocal about keeping my in laws out of our lives. It is a time in his life when he feels vulnerable and looks for advice and he must not go to these m$$$$$.
I also had a look at the "how to convert your spouse" sticky and see a few things I could do better in the future.
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I guess my opinion is that YOU cannot change him. So make the choices that put him in the realm of external consequences - bankruptcy or child care and work.
That is always the danger of posts like this, I covered one side of him and it puts him in a bad light. He is usually very giving, he loves fixing things for people, I would not label him a selfish taker.
BUT he is terrible with money and the economy in Western Australia has been in a mining boom for 10 years so many people swam naked for a long time without realising. Sadly, my DH is one of those people.
I agree with you, I need to establish boundaries, keep our finances separate and assume that FIRE will be for me to achieve on one income. I'm mostly fine with that but some days are harder than others.
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What does he want to do to fix this situation?
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If he is a stay at home parent how will he pay it off? You made yourself the sole bread winner that was your choice it seems. Or will he eventually go back to work?
If he goes back to work later would you be willing to make payments in the meantime?
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Reading about this dude I would definitely endorse keeping finances separate, though I am strongly against that in most cases. I don't know how he's going to eat out three meals a day while taking care of the baby, but you two need to start working on communication to make it through the newborn months anyways so you might as well start now with very, very clear expectations on how he will handle money from this point forward. It's about your son now.
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It's easy to keep finances searate when both are working and both are reponsible. My SO and I do this, no kids though. This guy is no longer going to be working though. If thats the case pay it off or DTMFA.
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Early child care is not evil. Have two career girlfriends who put their babies in good quality child care at 3 months and 5 months old. Both girls thrived and now are well adjusted 5 years old. Mothers continued working full time. One thing that helped they kept working hours 7.5 a day with an early start. Dads would drop babies off in the morning around 8, mothers pick them up at 4.30-5pm. Accidentally, both girlfriends born in Europe (German and Russian) so had no family support.
The cost of child care is about $500 per week then you get $7500 a year from the government back. Your DH salary should cover child care AND the loan if he continues full time.
Can you ask the inlaws to watch your baby once a week? Makes the child care much cheaper as you still get full $7500 back from the government.
Look, don't panic too much about this car loan. I had exactly the same situation when I just arrived to Australia, my ex forced me to cosign a $45K car loan on 10% interest. I put up a good fight but eventually gave in. It was 13 years ago, my salary was 30K, he was making 40K. Car loan payment was higher than our mortgage. But it was not the end of the world. We kept making payments, eventually divorced after 5 years and he paid the loan off before the property settlement was finalised.
What I would do is to calm down. If you love your husband, be strong for him, and here I mean stop nagging, don't turn into his mother. Give him a chance to grow up and pay his debts as big boys do. Yes I know, the interest is high. Still don't rescue him. He can do it, 60K is not the end of the world.
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It is not even the money as such that bothered me, it is the lack of foresight and disregard for himself and me. The thought of "if I do x then negative consequence y will happen to me." Never seems to cross his mind. Neither does the thought "bad consequence z will impact my wife." Then again, this is partly what attracts me to him, I am a planner and a worrier so he balances me out in a way? Other than this he is the most amazing guy with a heart of gold.
This is my relationship exactly.
In the past I have paid my husband's debt. Laws are different here though, and his debt is my debt.
I think if he agrees to stay home you should pay his debt. Not sure how you can expect him to pay it off without a job.
In my relationship it would have made sense for DH to stay home. However he is not the SAH type, and I know if he stayed at home he would just shop more. Please don't make him SAH if he doesn't want to or isn't equipped to do so.
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When I met my DH we were both divorced for about a year. He was in debt and I was not. I said I would not even think of marrying him until his debt was paid off. He was putting his head in the sand so I made an appointment with consumer credit and went with him. They worked out a great plan and he stuck to it. We married 5 years later. People can change their financial ways. I think he should keep his job and you guys should use childcare for the 1st year until your Mom comes.
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People can change their financial ways. I think he should keep his job and you guys should use childcare for the 1st year until your Mom comes.
Agree. People do change, and I think it's important to give him a chance. Everyone can screw up once, and it is important to let him undo it all by himself. If he becomes a SAHD, you may find yourself in a situation with two babies on your hands forever.
One thing I want to mention is that Perth rental market is extremely favourable to tenants at the moment. The vacancy rate is 10%, rents are falling every month. If you can find a place that will be very close to your work and child care centre, you can be close to your baby and even visit at lunch time. With an early start for one of you, you can arrange your schedule so that the baby spends only 7 hours a day there.
Also, men usually can take 2 weeks paid parental leave as well. DH can use it to watch the baby after your 3 months expired. Then there is annual leave for both of you, you may want to take turns to take 1 annual leave day a week for several weeks so that the baby spends only 4 days a week in child care initially.
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Why would you "kill his mom"? I know you were joking, but what does she have to do with his lack of discipline?
Not to sound harsh but you walked right into this, you knew he was a financial mess long before you married him, then broke up a couple times over it, then you married him anyway.
Good luck, hope things get better.
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I would not knowingly marry such an over-aged child.
I doubt I would stay married to one either. Certainly wouldn't volunteer to have a child by an over-aged child.
I know that doesn't help you one damn bit. Sorry. I wish it would.
Maybe it will help someone else to understand that "I broke up with the person for several damn good reasons" means "Don't get back together again."
Sometimes it's just best to dodge the bullet instead of try to choose the best emergency room to rush to.
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I would usually hesitate to talk about loved one's mistakes so openly but this situation has caused me lots of grief and I'd appreciate some feedback.
Prelude: when DH and I met two years ago, he was flat broke and starting his own business. I have no issues with that - i don't need a provider, but do draw the line at paying someone's debt.
We both live in Australia. About 8 months in, we decided to go to Europe. He had always wanted to go, I wanted to show him where I am from. It was a great trip and I'm so glad we went when we did BUT I had always made clear, if we go for 5 weeks it will have to be low budget. I recommended him for jobs (renovations at work colleagues places) that would make enough profit for him to pay his share. While travelling, we quarrelled a lot over his spending ways. For example, he packed too much luggage then always wanted to catch cabs. Or he'd go to restaurants and order beers each night - I'm like let's buy stuff and drink at the hotel. In the end, he had to randomly borrow money off me and when we came back he owed me $3,000.
It took a few months and some nagging to get that money off him and it really put a strain on our relationship. At one stage I broke up with him over it.
It is not even the money as such that bothered me, it is the lack of foresight and disregard for himself and me. The thought of "if I do x then negative consequence y will happen to me." Never seems to cross his mind. Neither does the thought "bad consequence z will impact my wife." Then again, this is partly what attracts me to him, I am a planner and a worrier so he balances me out in a way? Other than this he is the most amazing guy with a heart of gold.
Anyway the main event: a year ago, I broke up with him and asked him to move out. At the time he was driving a beaten up work car that was admittedly causing safety concerns (leaking tank). for whatever reason he decided to buy an almost new car on 5 year finance. I think he wanted to make himself feel better after the breakup. He asked me what I think about it, I said it is a really, really, really bad idea and sent him some links to read. He went and asked his mum (who has made many poor choices and spent most of her life on welfare) and she said "what a nice shiny car". At some stage he told me it was a zero finance loan and that it would help him get a credit rating to one day buy a house. I told him I really don't believe either but at this stage I was the ex and he is an adult and his mother is telling him to just get it....
So a week later we get back together again and I'm fuming he went ahead with the car loan. I told him look we are thinking of having a baby, you would be the stay at home parent and the key to achieving that is to reduce our living costs. this loan is a step in the wrong direction and let me be clear: I will not pay for it. He is like not a problem, he will get ahead on the payments so they are dealt with before kids.
A few months forward, we are getting married and I ask for a prenup. In his bit, he states the car is worth 30k and loan 30k.
The result:
So we got married, I fell pregnant and baby is due soon. I get three months paid leave and then we wanted for him to stay home. I kept asking him so what allowance do you think you'll need? And he kept being evasive. Partly because he eats out a lot, like twice or three times each day, which is an expensive and unhealthy habit he knows I loathe, but then finally a week ago comes the bummer. The car loan of course.
It turns out he signed up for a total liability of 60k for a car worth (at the time) 30k. I made him show me the paper work and was a bit shocked. 5 years on 16.5%. The break fee is really high too. To get out of the arrangement, they now quoted 43k when the car is now worth 20k. 4 years left on it. And they made it a business loan, so he signed away his consumer rights. Argh.
He has been stressing (& hiding it from me) for a while and I hate to see him like this. I want him to be happy. But I also want to reach FIRE and a free spending dependent isn't helpful. Note: in Australia, I am not liable for his debt and likely never will be (take my word for it, I've triple checked).
So my options are:
0. Refinance. Break fee too high, not worth it.
1. Pay it out. Pro: peace of mind, family approach. Con: I said I wouldn't. what if he does it again? And flame it that's a lot of money. Ouch! Plus I'd have to then get another car and pay for that.
2. Pay the instalments while DH stays home. Pro: good for our soon to be born son? Con: as above. And more expensive in the end.
3. Put the kid in child care so DH can continue working. Pro: no precedent of bailing him out, quicker to FIRE. Con: is that the best for our son? Will DH be able to make enough?
4. Call my mum for help, make her retire early, move to Australia and child mind (she was going to retire and do that in about a year).
5. Let him file bankruptcy and stay home. Pro: no precedent, facing up to consequences of his actions. Con: is it worth the trouble and stress to him for that amount? What crazy thing might such a big blow to his self esteem make him do? It feels mean.
6. Kill his mother (kidding. Not really.)
I have made him set up an appointment with a financial counsellor for later in the month to discuss his rights (payment plan, insolvency, bankruptcy).
Any thoughts would be appreciated.
I do love the guy and this is the main thing we fight about.
My only advice is that, whatever you decide, you draw a line and start fresh. He has to commit to change (and by change, I mean that he cannot put you and your son in a situation like this again) and you have to commit to starting fresh. We all make mistakes, but unless you forgive him and he makes a commitment to your financially healthy future, you will be re-living this in different iterations throughout your life together.
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Holy crap, this guy seems like a dirtbag. I have to wonder what kind of redeeming qualities somebody like that could possibly have.
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I have no problem at all with two working parents. We did it and I wouldn't have it any other way. There is no compelling evidence that kids do better with a SAHP. So, in your situation I would be fine with telling him we need to change plans and he needs to keep working. If you aren't going to do that, if you are going to stay married to him, you don't really have a choice but to pay off the debt. You can't expect him to pay it off if he's home with the kid.
I think your problems go a lot deeper than this one loan, though. You clearly aren't on the same page in terms of FIRE. The vast majority of people have no interest in FIRE, which is something that often gets overlooked here. We're the odd ones, they aren't. I would be fine with a partner who wasn't interested in FIRE, so long as they were frugal and sensible about money--that is if they lived their means and saved for normal retirement. That doesn't seem to be the case with your husband.
If you pay off the loan and he stays home, it sounds like your life is going to be one long fight about every lunch he gets out and every other non-essential dime he spends. He's going to be hurt and resentful. Having a SAHP creates a power imbalance in most relationships as it is.
I find some of your narrative a little odd, tbh. Personally, I'd be making sure we were in a very solid place before "I fell pregnant."
I think you'd benefit from some relationship counseling because the issues are deeper than a car loan.
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Hi, Norgirl. Your situation as described in the OP in this thread was bad enough that I read your history of posts to better understand what's in the background.
As for lying, I don't want to sound like I make excuses for him, but I don't think he lied as such. It seems obvious to *US on MMM* that he got a very bad deal. I don't think it is necessarily obvious to people who sign such agreements what they are doing.
I don't think he truly understood what he was doing until way down the line. But I agree he should not be hiding things from me. And I am getting increasingly vocal about keeping my in laws out of our lives. It is a time in his life when he feels vulnerable and looks for advice and he must not go to these m$$$$$.
You have serious marital problems. Your husband giving a series of evasive answers and secretly stressing out about a debt that's he's misrepresented to you then hidden from you ("he will get ahead on the payments so they are dealt with before kids" - sounds like the debt was supposed to be gone by now) - this is dishonesty and has nothing to do with his financial acumen or susceptibility to poor spending urges. It is lying.
In Australia, living together for two years makes you de facto and essentially makes it all like a marriage. So I figured we might as well. It made zero difference really.
I did ask him for a prenup which will be worth little in court once kids come along but at least it's a snapshot of where we came from.
Your comment above from another thread makes it sound like you "fell" into marriage because the government imposes a certain status and set of responsibilities when a couple shacks up for long enough. It doesn't blare "I choose you! I trust you, I have faith in your abilities, I want to mesh our entire physical, social, emotional, and financial lives together!"
Are you completely meshed? Yes, because you're having a child together and you've indicated that the pre-nup isn't going to hold up once you've procreated together. Whether that level of life-integration was intentional, you've both chosen to marry each other so that's where you are, now.
You need marital counselling (for real - your husband has a history of not following through on financial promises he has made). You both need to commit to mutual goals, commit to honesty and communication, and commit to a plan. Pick the option regarding the car loan that fits these goals and your plan.
Posts like these end up with a lot of commenters piling onto the spouse and turning the issue into a referendum on the relationship. I acknowledge that you see lots of good things in your husband and want to make the relationship better. You can do that and get off this merry-go-round of broken promises, conflicts, and break ups if you both face up to the seriousness of your problems and make changes.
Best wishes to you both and to your upcoming baby!
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Thank you MissWhipple and cassis for your replies. I feel really mean contemplating sending him into bankruptcy so you made me feel better.
You are not sending him into bankruptcy. His poor decision making is sending him into bankruptcy. I hope that he is not making you feel guilty or stressed over it; if anything he should be grateful that he has a financially literate partner who can help him make the right decisions from here on out. And I do mean help - you should be partners in this relationship, not the mom giving her husband an allowance and fixing all his mistakes for him.
I also don't see how you can possibly say that he didn't lie - "I ask for a prenup. In his bit, he states the car is worth 30k and loan 30k."
That is a lie. In writing, in a legal document starting your marriage off, for pete's sake. It's not like he hemmed and hawed and didn't want to tell you - he straight up lied about how much he owed. That's the part that worries me. Not the poor decision making - lord knows we all make stupid decisions - but the deceit.
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Holy crap, this guy seems like a dirtbag. I have to wonder what kind of redeeming qualities somebody like that could possibly have.
Huuuuuge... tracts of land?
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Thank you MissWhipple and cassis for your replies. I feel really mean contemplating sending him into bankruptcy so you made me feel better.
You are not sending him into bankruptcy. His poor decision making is sending him into bankruptcy. I hope that he is not making you feel guilty or stressed over it; if anything he should be grateful that he has a financially literate partner who can help him make the right decisions from here on out. And I do mean help - you should be partners in this relationship, not the mom giving her husband an allowance and fixing all his mistakes for him.
I also don't see how you can possibly say that he didn't lie - "I ask for a prenup. In his bit, he states the car is worth 30k and loan 30k."
That is a lie. In writing, in a legal document starting your marriage off, for pete's sake. It's not like he hemmed and hawed and didn't want to tell you - he straight up lied about how much he owed. That's the part that worries me. Not the poor decision making - lord knows we all make stupid decisions - but the deceit.
Well it's important whether it was a willful lie or an ignorant one.
It's possible the OP's husband didn't realize it was for that much when he signed the prenup. A surprising number of people have absolutely no clue about the state of their finances, debt, or otherwise have no ability to talk about their finances. If he did realize this after the fact, a fairly normal reaction is shame - and hiding from Norgirl as it's hard to bring that sort of subject up. Still not great relationally, but at least a starting place for working together.
Or maybe he did know and blatantly lied.
If he is a stay at home parent how will he pay it off? You made yourself the sole bread winner that was your choice it seems. Or will he eventually go back to work?
+1
I think Norgirl and MrNorGirl need to talk through expectations for their marriage and life. I get the feeling that neither is communicating that great on this sort of subject - it kind of sounds like Norgirl approached it like, "so you're going to be doing childcare and I'm working. How much money will I need to give you to keep you alive as the child's cartaker?" rather than them looking at it as a couple.
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Norgirl. Sounds like me 13 years ago. DH was trying to start his own business, had run up $30k in credit card debt on our joint accounts. I was committed to the marriage, kids were 7 and 3. So we got a second mortgage on the house, I got some low interest credit cards to transfer the debt to. Blah blah blah. Didn't work. I ended up paying the credit cards off myself and second mortgage down myself. Then DH ran up the second mortgage again. So I separated our finances. Then paid off the second mortgage and closed the account.
I would suggest finding out just exactly what you are responsible for. In my state (in the US), I'm not responsible for the credit card debts of my spouse. However, a creditor did put a lien on our house for a revolving credit line DH forgot to add to his debt consolidation agreement. He has paid off all of his most recent debt, but can't seem to save any of his own money. Protect yourself and your baby.
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I can relate to what attracted you to him. When I met DH it was like I was seeing the world for the first time. I had spent my life being a worrier and for the first time I could let go a little and just trust that things would work out.
We've had our own challenges some financial some in other areas. I would suggest separating the financial from the emotional/relationship issues. For the financial I think you can look at it fairly rationally. Assuming you decide to stay--you look at the big picture together and see how this 16.5% loan fits in. I would guess it doesn't. I think it's lucky that he can declare bankruptcy and get rid of the car without affecting your credit. Keep your credit separate because at least one of you needs to have good credit.
please protect yourself. don't trust that he won't do something like this again. He flat out lied to you. He very likely *will* do something like this again.
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Honey, listen to every wise word from okits.
Plus this: never, ever forget that you chose to marry him AND chose to make a baby with him, clearly before he, as an individual, and you, as a couple, were ready. The likelihood of your marriage being a success is as dependent on you taking responsibility for your actions as it is on him for his.
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I tried to post a response but all my comments were super judgemental and not helpful.
There is no such thing as "bad with money". It's bad decision-making. It's refusing to act like an adult. It's refusing to educate yourself and act with discipline. Children play Monopoly and can grasp how basic money works.
He needs to start taking responsibility for himself.
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I tried to post a response but all my comments were super judgemental and not helpful.
There is no such thing as "bad with money". It's bad decision-making. It's refusing to act like an adult. It's refusing to educate yourself and act with discipline. Children play Monopoly and can grasp how basic money works.
He needs to start taking responsibility for himself.
I was just about to say that some people are naturally "shit with money" and you just debunked it :D
There are a few red flags in the OP's post as others have pointed out.
If I could offer something constructive I would ask you to look into unfair contracts law (there are different rules that apply to small businesses as opposed to consumers). IANAL but a legal professional *may* be able to find something in the case law that might resemble a car dealer taking advantage of someone who didn't really understand what they were signing.
I get the sense your husband didn't lie about the $30k car/$30k loan.... I reckon he genuinely thought "if the car is worth $30k, then the loan couldn't possibly be higher than that".
Ignorance can be more dangerous than deception sometimes.
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This is a really difficult situation.
I used to be married to a spender but thankfully current DP is more frugal than I am. Makes a huge difference. I remember when ex husband and I were surviving on $100 a week and he would still buy beer and cigarettes. wtf! I knew I could never have kids with this man and left.
However, I am sure your husband has good qualities otherwise you would never have stuck with him. But you have to protect yourself and your son primarily and then protect your husband from himself and his poor decision making.
I have to disagree with other posters who say early childcare is fine. There is good evidence that childcare under age 3 does disadvantage kids. Sure there will be some who are largely unaffected but if you are a vulnerable child who may be profoundly affected. There is a dose response relationship where the more childcare the worse it is. The younger the child is the worse it is. For a while researchers thought it was just that the quality of the childcare was insufficient but evidence from Scandinavia where childcare is top notch still shows detriment for children under 3. What these kids need is care from people that love them - parents, family members, close friends. They just don't get the same bonding and emotional encouragement from people who don't love them.
So he stays home or you do a part time each thing. But you have to behave like a 1950s husband. He gets an allowance and no credit card. He pays his car loan out of the allowance. And eating out 3 times a day. I think you said you live in WA - this is unsustainable. We have eaten out I think 10 times in the 6 years we have been in Perth. We used to eat out once a week in lower cost of living areas. I cannot believe people think this is worth it. If he wants you to help him this has to be the terms of engagement. Are you sure you have explored getting rid of the loan adequately? We drive a $1000 hail damaged car (remember the storm of 2010) and could afford to buy 10 shiny new cars but we don't. It still goes from a to b. Your dh is a spending emergency.
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What does he want to do to fix this situation?
This x100. Every solution you list seems to require you to fix the situation. I think the only hope for your relationship and for him to stop being an irresponsible lying dirtbag is that your quit fixing for him. If he can't (won't) fix it then you decide if you want to continue to be in a relationship with someone who behaves this way.
I think the chances of him changing his behavior is extremely low and you should assess how he is now, assume he will always be this way, and if this is the life you want.
What did he do with the extra 30k in the loan that he took over the value of the car? He got a 30k car and a 60k loan - where is the money?
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You pay off the debt, and you get to drive the car; make sure the title is transferred to you. There's the built in punishment for lying about the "0 finance loan".
Ricksun
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Your post is very concerning. Despite repeated red flags regarding his poor financial management, you have chosen to just stick around and accept the current situation. Now you want to know if you should bail him out. The problem isn’t the money, as others have pointed out. The problem is that this man seems to be struggling with learning how to manage money, and bailing him out will not fix that underlying issue.
Here is what will happen if you do not help HIM to learn how to manage his money. The following is the true story of my parents…
Mom and dad have been married for a very long time.Both work. My dad is an overspender, carries cc debt month to month, leases new cars every few years, and generally is very mediocre at these sorts of things. However, they were able to stay afloat due to their high income over the years. My mom is a vastly better money manager than my dad. She never carries cc debt on her cards, saves diligently for her retirement in her employer plan, etc. Not a financial whiz, but she knows the basics and sticks to them. However, her fundamental money mistake was burying her head in the sand and letting my dad continue to mismanage his money and their joint assets. My mom would talk to him about issues and problems, debts, back taxes, etc, but never really took a hard line stance. She had her concerns every now and then...like you...but ultimately, she let them slide.
Now they are in their mid 60s and set to retire in a few years. My mom just found out my dad has been drawing off the equity in their home (a key piece in their retirement plan) to pay monthly bills. He has racked up huge amounts of cc debt on his cards and is often short on cash despite making good money. The mortgage has been late a few times over the past year, and when confronted, my dad says “he didn’t have the money” to pay it on time. My mom had no idea until she found his cc statements showing the debt load, and got calls from the mortgage company asking for payment. He HID these things from her, and probably has been hiding them for years. When confronted, my dad gets extremely defensive and blows her off. It is a veritable financial nightmare and makes me sick to my stomach. All she can do now (other than divorce him) is protect her credit and her own assets, and try to stonewall any attempts he makes at harming the home equity. It is devastating for her, and also really scary for the adult kids too because we seem to have a parent who is slowly bankrupting himself going into old age.
THESE PROBLEMS WILL NOT GO AWAY UNLESS YOU TAKE A HARD LINE STANCE. Enroll in a money management class together. Offer to take over all of the home accounting. Go to marriage counseling. Do something. Do not just pay it off and then hope it won’t happen any more. My dad is also a great guy, very loving/supportive/etc. But that doesn’t mean that his crap financial skills aren’t seriously harming his wife, his marriage, and possibly even his adult kids. Personally, if I were married to a man like your husband or my father, I would INSIST that I manage the family finances, and that I have access to his cc statements online. I would absolutely not trust them to pay bills and manage accounts totally independently. And yes, as hard as it would be, I would try to start coming to terms with the fact that one day, you might have to leave him over this. You can't be caring for a family with someone who is financially sabotaging you at every turn.
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I'd ask him what he plans to do to fix the situation, and as him to put together a plan and run it by me.
Also, unless you husband is very not-smart, there's no way he mistook a 16% loans for a 0% loan. I don't see how that's anything but a lie. Not a misunderstanding, a lie.
Although I'd ask him for his plan, I can't imagine a scenario where I'd be willing to put up my money. Frankly, I can't imagine a scenario where I would have married him. If I was butting up against a common law marriage deadline, instead of doubling down with marriage, I would have moved out rather than marry (either formally or common-law) a man who had proven himself untrustworthy with money and who didn't share met values. But that ship as sailed, so it seems like damage control is really all you can do, and in this case, that means creating a barrier so you are protected as much as possible from his spendypants-itis.
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Seems like you can't change him-please do not bail him out of anything, unless it hurts you and the baby enormously.
He has to see it.
Work on yourself and baby situation.
It sounds like enabling.
Put some time learning about that and breathe.
It could get a lot worse, so work on self first.
Best to you and your family.
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Holy crap, I will say I read the OP and didn't read the subsequent responses.
I can't even imagine why someone would enter a legally binding arrangement such as marriage with someone who is as far away from having their shit together as your husband.
One of the #1 relationship strainers/enders are disputes over $$ in a couple. I would strongly consider an annulment/divorce. There are more red flags in your post then I care to point out.
I wish you luck, but think long and hard about this relationship. DO NOT PAY HIS DEBT.
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Just one thing to think about:
Your husband sounds very much like my BIL. Makes poor financial choices, chooses not to work enough to cover what he wants to buy but buys it anyway, eats out (too lazy to cook).
His plan was always to be SAHP, because he doesn't like to work, was always the lower earner, chose repeatedly to cut his hours.
At one point he was babysitting for a friend's infant. Friend came home to find BIL playing on computer and baby sticking fingers into the electric socket in a soiled nappy that was hours old. It turns out BIL wanted to be a SAHP because he reckoned it was easier than working.
From what you've said I'd question whether he would be the best carer for your baby. The lack of responsibility that he's shown over this car situation and the time you were travelling would bother me.
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I say either daycare or your mom.
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I am so sorry! This is red flag city and you have to find a way out of it. I know it's an awful time because the baby is coming and that's stressful too.
Whatever you do, it CAN'T be rescuing him from the natural consequences of his decisions and it CAN'T sacrifice your own solid future.
Top priority is you and the baby have to be OK
I don't know AU law about debts or divorce but I hope you very quickly become an expert on it!
this is a little unconventional now but hear me out... Perhaps the best move to protect yourself, the baby, and teach him to get his act together, would be to set a very firm standard that you will NOT be married to a person whose financial life is a trainwreck. You love him but you will not sacrifice your own security, short and long term, for him. Therefore, you legally separate until he gets his act together and is ready to be a full adult partner and support in your life. Say, "I love you, I cannot be married to you, I hope we can reunite". Get a lawyer and file the divorce/separation papers, no matter what he says next, because this is about a long period of action proving he is ready, it is not about the car or whatever he says when he promises to change.
Don't solve this problem for him. It will never end. He needs to demonstrate honesty. He needs to feel the financial consequences and learn to make better decisions. He needs to show respect and love for you and the baby by not allowing you to suffer for his decisions.
Good luck!
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Don't bail him out and don't have him be a SAHP.
If it's really all just a misunderstanding/lack of knowledge then he needs to see the results of his mistakes by working to pay it off. You swooping in and paying it off gives him a different lesson - he spends, you pay.
Having him be a SAHP has another downside. When you get divorced as the SAHP he could get custody of the child and you could pay him child support...and possibly spousal support. Even if you get custody, he'll be set up to pay little child support. Is there any reason to even believe that he would be a good SAHP? Some men are, of course, but most weren't raised to do it.
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Don't bail him out and don't have him be a SAHP.
If it's really all just a misunderstanding/lack of knowledge then he needs to see the results of his mistakes by working to pay it off. You swooping in and paying it off gives him a different lesson - he spends, you pay.
Having him be a SAHP has another downside. When you get divorced as the SAHP he could get custody of the child and you could pay him child support...and possibly spousal support. Even if you get custody, he'll be set up to pay little child support. Is there any reason to even believe that he would be a good SAHP? Some men are, of course, but most weren't raised to do it.
100% agree. Love quickly goes away when you can no longer respect a person. And respect quickly goes away when you see the person you love and respect act selfish, especially after having a baby.
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This is quite the bandwagon. And I'm sorry you are going through this, but people are speaking the cold hard truth.
What is your best case scenario here? That he (1) lied to you about the terms of the loan or (2) was too lazy, unintelligent, or willfully ignorant to notice the interest rate? If it is the latter, do you trust the daily safety of your child with such an individual?
I'm going to guess that it is a combination of both, and suggest that you run to marriage counseling, or for the hills.
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7. Let him declare bankruptcy AND go back to work.
My kid loves day care.
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This is quite the bandwagon. And I'm sorry you are going through this, but people are speaking the cold hard truth.
What is your best case scenario here? That he (1) lied to you about the terms of the loan or (2) was too lazy, unintelligent, or willfully ignorant to notice the interest rate? If it is the latter, do you trust the daily safety of your child with such an individual?
I'm going to guess that it is a combination of both, and suggest that you run to marriage counseling, or for the hills.
Hold up a second here.
Everyone seems to be assuming that the husband here intentionally and deliberately lied. This might be the case, but a page of people writing "this guy is a complete loser/jerk get out!" is in response to something that no one knows for certain.
Willful vs accidental ignorance here is a HUGE difference and one which Norgirl hasn't really clarified yet, though this suggests it was not intentional:
Thank you MissWhipple and cassis for your replies. I feel really mean contemplating sending him into bankruptcy so you made me feel better.
As for lying, I don't want to sound like I make excuses for him, but I don't think he lied as such. It seems obvious to *US on MMM* that he got a very bad deal. I don't think it is necessarily obvious to people who sign such agreements what they are doing.
I don't think he truly understood what he was doing until way down the line. But I agree he should not be hiding things from me. And I am getting increasingly vocal about keeping my in laws out of our lives. It is a time in his life when he feels vulnerable and looks for advice and he must not go to these m$$$$$.
I also had a look at the "how to convert your spouse" sticky and see a few things I could do better in the future.
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There are so many red flags here. You need to protect your child and yourself ahead of your husband.
So a week later we get back together again and I'm fuming he went ahead with the car loan. I told him look we are thinking of having a baby, you would be the stay at home parent and the key to achieving that is to reduce our living costs. this loan is a step in the wrong direction and let me be clear: I will not pay for it. He is like not a problem, he will get ahead on the payments so they are dealt with before kids.
You are about to teach your husband something VERY important about your relationship dynamic -- either he will learn that you mean what you say and will enforce your clearly-stated boundaries, or he will learn that your notice of consequences is meaningless and he should continue to do whatever he wants because you will just be a pushover and will rescue him anyway. Which lesson do you want him to come away with? You already have a pattern with him (see the $3,000 Europe loan), and I'm afraid that you will acquiesce to living it over and over again (and attempt to drag in innocent bystanders like your child and your mom).
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I have to disagree with other posters who say early childcare is fine. There is good evidence that childcare under age 3 does disadvantage kids.
Citation please? Because every study I've ever read has shown no difference.
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At the same time you are also reinforcing that what you say goes no matter what. And he may be interpreting it as when he needs help you will throw him under the bus.... Maybe I'm an enabler but if she is saying she really loves him and wants to be together they should be working together not drawing lines in the sand of mine vs yours. Let's think about it from the other side. He may just be completely overwhelmed by it and ignoring it because he doesn't know what to do. You've obviously made it known he's made a big mistake but now he's ashamed. He knows if he brings it up, even under the context of asking for help, that you may just start a fight about how irresponsible he is and how it is HIS problem to deal with. Then he goes and asks anyone else for their help (his mom) and you flip again when he is just trying to figure out what to do. See how none of this is helping?? Is there anything he do right now about the loan that would make you happy?
So he made a mistake and got roped in to new car and bad loan. Most people fall into this trap. I mean there's like 3 posts today alone about people realizing their new car was a bad idea. Maybe not to this extreme (we still need to figure out where that 20k difference went). I like to think I'm smart and practical but I bought a brand new luxury car with my first job and got a stellar 9% loan. I didn't think twice about the interest rate until a year or two later. It was 10k+ underwater for so long. I didn't get rid of that money pit for 5 years! Looking at your age this happened at 24/25 so I don't see how everyone is writing this guy off as a total degenerate because he got a bad car loan and buys fast food...
Only you know if this is isolated or repeated events that will actually affect your financial stability. Past this one big thing, the car, are his spending habits really that bad that they will significantly hinder your stability and life? Us planners are drawn towards partners that can throw caution to the wind. Some "excess" spending in our frugal eyes comes along with the territory. I think if these are isolated incidents then you should talk it through, teach him, do some financial counseling, and help dig your family out of the hole. If you aren't willing to do that than you may want to seriously think about calling it quits right now.
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I have to disagree with other posters who say early childcare is fine. There is good evidence that childcare under age 3 does disadvantage kids. Sure there will be some who are largely unaffected but if you are a vulnerable child who may be profoundly affected. There is a dose response relationship where the more childcare the worse it is. The younger the child is the worse it is. For a while researchers thought it was just that the quality of the childcare was insufficient but evidence from Scandinavia where childcare is top notch still shows detriment for children under 3. What these kids need is care from people that love them - parents, family members, close friends. They just don't get the same bonding and emotional encouragement from people who don't love them.
Could you, please, share the link to this research with us?
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I have to disagree with other posters who say early childcare is fine. There is good evidence that childcare under age 3 does disadvantage kids.
Citation please? Because every study I've ever read has shown no difference.
Could you, please, share the link to this research with us?
Same question for kiwiozearlyretirement as posed by mm1970 and urbanista.
Anecdotally, my mom ran a family daycare business in our home for like 20 years, and she is still in touch with almost every family who was ever a customer. She treated all of the children extremely well and with genuine love to foster their sense of security, learning, and development. Most of those families ended up having additional children who then went to my mom, and they stayed with her long-term. Many of the kids and their parents have now "friended" my mom on facebook (a few years ago, she moved far away, so she doesn't get to see them as much), and they invite her milestones like graduations and weddings. By many measures, these kids are very "successful," and I simply don't believe that they are worse off for having been in her care rather than the parents' care during that time. (And if you're going to say that not all daycares are as nice as that, I'm sure that is true, but in that case, the causal factors may be neglect or mistreatment, not the fact of daycare in and of itself.)
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I don't think there is any credible source showing that daycare is detrimental to child development, unless it is also paired with absentee parents outside of daycare hours. Anyhoo, to re-rail the thread, I do think many of you are piling on a bit hard. While there do seem to be a number of red flags, I can speak from personal experience (e.g. DW is my second marriage) that your "advice" along those lines is likely not helpful and probably making it hard for OP to appreciate other less judgmental comments that have been made.
I totally believe all of your hearts are in the right place, but let's just leave it at the fact that many of you have concerns for the future of the relationship and suggest counseling. OP can choose to agree or disagree, but if this thread is to continue, I think it's best we refocus on other avenues of discussion.
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I have to disagree with other posters who say early childcare is fine. There is good evidence that childcare under age 3 does disadvantage kids. Sure there will be some who are largely unaffected but if you are a vulnerable child who may be profoundly affected. There is a dose response relationship where the more childcare the worse it is. The younger the child is the worse it is. For a while researchers thought it was just that the quality of the childcare was insufficient but evidence from Scandinavia where childcare is top notch still shows detriment for children under 3. What these kids need is care from people that love them - parents, family members, close friends. They just don't get the same bonding and emotional encouragement from people who don't love them.
Could you, please, share the link to this research with us?
If I recall, several years ago there was a big ado about research (I think from a study in Britain) showing that kids put childcare under age 3 are more likely to have mild behavioral issues in junior high and high school. The impact was slight and didn't show up in any long term impact, but there was concern that in aggregate, there might be a negative impact on primary and secondary classrooms with a large percentage of children that were put in daycare as an infant. Not sure if any follow up research confirmed or disproved the effect they found.
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I'm confused, you said this is a business loan, right?
Does he actually have a business (and if so, does he plan to continue it?)
Is he personally liable for the debt?
I don't understand what is stopping him from just walking away.
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I have to disagree with other posters who say early childcare is fine. There is good evidence that childcare under age 3 does disadvantage kids. Sure there will be some who are largely unaffected but if you are a vulnerable child who may be profoundly affected. There is a dose response relationship where the more childcare the worse it is. The younger the child is the worse it is. For a while researchers thought it was just that the quality of the childcare was insufficient but evidence from Scandinavia where childcare is top notch still shows detriment for children under 3. What these kids need is care from people that love them - parents, family members, close friends. They just don't get the same bonding and emotional encouragement from people who don't love them.
Could you, please, share the link to this research with us?
If I recall, several years ago there was a big ado about research (I think from a study in Britain) showing that kids put childcare under age 3 are more likely to have mild behavioral issues in junior high and high school. The impact was slight and didn't show up in any long term impact, but there was concern that in aggregate, there might be a negative impact on primary and secondary classrooms with a large percentage of children that were put in daycare as an infant. Not sure if any follow up research confirmed or disproved the effect they found.
If it's the one I'm thinking of they didn't control for household income or single parents.
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Is there any reason to even believe that he would be a good SAHP? Some men are, of course, but most weren't raised to do it.
I need to call bullshit on this. There are some people that would be great SAHPs and some that would be awful. There is no need to bring gender into it.
I 100% share your concerns about this person, but let's not tar other men with his issues.
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If I recall, several years ago there was a big ado about research...
An anecdote about data. God I love the internet.
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I would usually hesitate to talk about loved one's mistakes so openly but this situation has caused me lots of grief and I'd appreciate some feedback.
Prelude: when DH and I met two years ago, he was flat broke and starting his own business. I have no issues with that - i don't need a provider, but do draw the line at paying someone's debt.
We both live in Australia. About 8 months in, we decided to go to Europe. He had always wanted to go, I wanted to show him where I am from. It was a great trip and I'm so glad we went when we did BUT I had always made clear, if we go for 5 weeks it will have to be low budget. I recommended him for jobs (renovations at work colleagues places) that would make enough profit for him to pay his share. While travelling, we quarrelled a lot over his spending ways. For example, he packed too much luggage then always wanted to catch cabs. Or he'd go to restaurants and order beers each night - I'm like let's buy stuff and drink at the hotel. In the end, he had to randomly borrow money off me and when we came back he owed me $3,000.
It took a few months and some nagging to get that money off him and it really put a strain on our relationship. At one stage I broke up with him over it.
It is not even the money as such that bothered me, it is the lack of foresight and disregard for himself and me. The thought of "if I do x then negative consequence y will happen to me." Never seems to cross his mind. Neither does the thought "bad consequence z will impact my wife." Then again, this is partly what attracts me to him, I am a planner and a worrier so he balances me out in a way? Other than this he is the most amazing guy with a heart of gold.
Anyway the main event: a year ago, I broke up with him and asked him to move out. At the time he was driving a beaten up work car that was admittedly causing safety concerns (leaking tank). for whatever reason he decided to buy an almost new car on 5 year finance. I think he wanted to make himself feel better after the breakup. He asked me what I think about it, I said it is a really, really, really bad idea and sent him some links to read. He went and asked his mum (who has made many poor choices and spent most of her life on welfare) and she said "what a nice shiny car". At some stage he told me it was a zero finance loan and that it would help him get a credit rating to one day buy a house. I told him I really don't believe either but at this stage I was the ex and he is an adult and his mother is telling him to just get it....
So a week later we get back together again and I'm fuming he went ahead with the car loan. I told him look we are thinking of having a baby, you would be the stay at home parent and the key to achieving that is to reduce our living costs. this loan is a step in the wrong direction and let me be clear: I will not pay for it. He is like not a problem, he will get ahead on the payments so they are dealt with before kids.
A few months forward, we are getting married and I ask for a prenup. In his bit, he states the car is worth 30k and loan 30k.
The result:
So we got married, I fell pregnant and baby is due soon. I get three months paid leave and then we wanted for him to stay home. I kept asking him so what allowance do you think you'll need? And he kept being evasive. Partly because he eats out a lot, like twice or three times each day, which is an expensive and unhealthy habit he knows I loathe, but then finally a week ago comes the bummer. The car loan of course.
It turns out he signed up for a total liability of 60k for a car worth (at the time) 30k. I made him show me the paper work and was a bit shocked. 5 years on 16.5%. The break fee is really high too. To get out of the arrangement, they now quoted 43k when the car is now worth 20k. 4 years left on it. And they made it a business loan, so he signed away his consumer rights. Argh.
He has been stressing (& hiding it from me) for a while and I hate to see him like this. I want him to be happy. But I also want to reach FIRE and a free spending dependent isn't helpful. Note: in Australia, I am not liable for his debt and likely never will be (take my word for it, I've triple checked).
So my options are:
0. Refinance. Break fee too high, not worth it.
1. Pay it out. Pro: peace of mind, family approach. Con: I said I wouldn't. what if he does it again? And flame it that's a lot of money. Ouch! Plus I'd have to then get another car and pay for that.
2. Pay the instalments while DH stays home. Pro: good for our soon to be born son? Con: as above. And more expensive in the end.
3. Put the kid in child care so DH can continue working. Pro: no precedent of bailing him out, quicker to FIRE. Con: is that the best for our son? Will DH be able to make enough?
4. Call my mum for help, make her retire early, move to Australia and child mind (she was going to retire and do that in about a year).
5. Let him file bankruptcy and stay home. Pro: no precedent, facing up to consequences of his actions. Con: is it worth the trouble and stress to him for that amount? What crazy thing might such a big blow to his self esteem make him do? It feels mean.
6. Kill his mother (kidding. Not really.)
I have made him set up an appointment with a financial counsellor for later in the month to discuss his rights (payment plan, insolvency, bankruptcy).
Any thoughts would be appreciated.
I do love the guy and this is the main thing we fight about.
I have a different view from most of the posters here. The first decision point is do you want to be married to this guy. And not, are you in a legal contractual relationship, but are you wanting to be in a traditional, til death do us part, marriage. If the answer is yes, then your financial options become much simpler. The is no his debt. There is just debt. You figure out your goals as a couple, and then you figure out the best way to get there. You still have the issue of him lying to you, and you have the issue of whether he is going to be a responsible adult going forward, but those don't really have an impact on your plan for your debt, except that maybe taking his decision making and work ethic into account when deciding between two close options.
If you don't want to be married to the guy in a death til you part type marriage, then you need to think not in terms of what to do with your debt, but how to protect your interests. Not sure about Australian law, but in teh U.S., marriage is typically a bad legal vehicle for people that are not strongly committed to it being a forever thing. That's not to say that divorce is the route to go if you're already married (I assume it isn't, at least not now); it just means you have to keep an eye towards the fact that it isn't likely to be a permanent arrangement and therefore you have to proceed in a way that doesn't make it unreasonably difficult to unwind your finances later on. If this is the route you want to go, I would say you owe your husband an honest discussion about it, although that could potentially be tricky. I know plenty of people who think of marriage as just something you do until it's not something you want to do anymore, and they would think of it as a no duh type conversation. I know plenty of other people (including people who have been through a divorce already) who think of marriage as something intended to be permanent, and they would be horrified to hear their spouse openly talk about contingency plans for when they are no longer married.
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I just wanted to say to everyone questioning why she married him - back off.
My husband and I went to a marriage counselor when my son was 6 months old, to help us adjust to the new money and other relationship issues with a new kid. The counselor said that is his most common issue - woman drastically upgrades her expectations of her husband after a baby. Man feels like the agreement has changed and resists. It's one of the most fundamental challenges of a couple once they procreate. She's hardly alone.
A great ethnography of this is Doing the Best I Can (http://"https://www.amazon.com/Doing-Best-Can-Fatherhood-Inner/dp/0520274067"). It focuses on inner-city poor fathers in the US, but the dynamic is the same. The difference is, these fathers don't often have the ability to step up in the way they are needed, so they fade out of their kid's lives.
Norgirl's man isn't in that situation - it sounds like he has the ability to contribute in a lot of ways. The heartbreaking thing and the hardest thing for her to accept is that it really isn't her decision. It's his. He needs to decide whether to accept the responsibility and figure out a solution, and follow through. Then she gets to make her decision to stay or go.
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You are not going to change him, you know. He is who he is.
That being said, is there a legal way so that you would not be responsible for his debts? It might reduce the tension between the two of you.
As for him being a househusband, well that is totally up to the two of you. But, I STRONGLY suggest you pay the joint bills. And have an account for the household and an account for him. That means a bit more wok for you as you take the shopping list he gives you and shop on your way home, but I strongly suggest that there will be much less friction between you if you do not worry about what he is buying.
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Thanks for everyone's responses. These sorts of threads are always difficult as everyone necessarily makes assumptions about context, character etc. still, no need to label him quite so harshly please.
some of this comes down to values - what is this whole FIRE thing for? For me, money is there to allow me and mine a happy, stress free life. Money is an enabler for family, not the other way around. I don't want to sit home alone counting my stash. If your ideal life is to play the dating game and cut anyone loose as soon as they show they are imperfect, go for it. But know most people will want to settle down one day and for most of us imperfect humans that will be with another imperfect human.
I also can't help but sense a bit of underlying sexism in some of the responses. It seems financial troubles are sometimes judged more harshly in a male. I wonder if a guy posting about his wife's consumer debt would have received similar responses ("cut her loose she is clearly incapable of looking after kids?"). And to automatically assume because none of the options I stated include me staying at home with baby we must be "in a hole", that is kind of sexist too.
For context, we are not "in a hole", I am in a pretty good place with eight years to FIRE and if I wanted to stay home for the next 18 years I could - but would burn through my net wealth and it is not what I want. I have a savings rate of 75%, 18 months left on the mortgage and no I'm not looking to sell up and rent. We did not break up repeatedly, just that once for one week. I did not "fall" pregnant, we did IVF and are both over the moon. He clearly tried very hard to get ahead on the car payments but couldn't as business is bad. And he is really good with kids.
Thank you MissWhipple and cassis for your replies. I feel really mean contemplating sending him into bankruptcy so you made me feel better.
You are not sending him into bankruptcy. His poor decision making is sending him into bankruptcy. I hope that he is not making you feel guilty or stressed over it; if anything he should be grateful that he has a financially literate partner who can help him make the right decisions from here on out. And I do mean help - you should be partners in this relationship, not the mom giving her husband an allowance and fixing all his mistakes for him.
I also don't see how you can possibly say that he didn't lie - "I ask for a prenup. In his bit, he states the car is worth 30k and loan 30k."
That is a lie. In writing, in a legal document starting your marriage off, for pete's sake. It's not like he hemmed and hawed and didn't want to tell you - he straight up lied about how much he owed. That's the part that worries me. Not the poor decision making - lord knows we all make stupid decisions - but the deceit.
Well it's important whether it was a willful lie or an ignorant one.
It's possible the OP's husband didn't realize it was for that much when he signed the prenup. A surprising number of people have absolutely no clue about the state of their finances, debt, or otherwise have no ability to talk about their finances. If he did realize this after the fact, a fairly normal reaction is shame - and hiding from Norgirl as it's hard to bring that sort of subject up. Still not great relationally, but at least a starting place for working together.
Or maybe he did know and blatantly lied.
Exactly. It is hard for us on here to contemplate but there is a reason these consumer finance places are in business. There are tons of people who just don't understand what they are signing. Again, save the labels. Let's just accept the fact there are lots of people who sign financial agreements they don't fully understand (but think they do) and once they have an inkling something is off they'd rather not know how bad exactly it is. Shame, guilt, etc. and head in the sand kind of thing.
If I'd have to label my husband for this, I'd say naive and overly trusting - certainly not cunning or malicious. And there is nowhere else the money could have gone to. They just tell them you pay $1,000 dollars a month for sixty months and hope you never do the maths to realise you are signing up to pay 60k for something worth 30k.
Anyways, I am not contemplating divorce and I am glad I married him. If he was to be hit by a car tomorrow and in a wheel chair I'd look after him for the rest of my days and I think he would do the same for me. These were the vows we made.
BUT the point here is he did not get hit by a car, he made a mistake. Ideally, there would be a way for him to work it out himself without an impact on me (through a stressed and ashamed husband or a financial setback) or our son (through suboptimal Childcare). But this ideal choice does not seem to exist and the question is which other choice is second best.
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At the same time you are also reinforcing that what you say goes no matter what. And he may be interpreting it as when he needs help you will throw him under the bus.... Maybe I'm an enabler but if she is saying she really loves him and wants to be together they should be working together not drawing lines in the sand of mine vs yours. Let's think about it from the other side. He may just be completely overwhelmed by it and ignoring it because he doesn't know what to do. You've obviously made it known he's made a big mistake but now he's ashamed. He knows if he brings it up, even under the context of asking for help, that you may just start a fight about how irresponsible he is and how it is HIS problem to deal with. Then he goes and asks anyone else for their help (his mom) and you flip again when he is just trying to figure out what to do. See how none of this is helping?? Is there anything he do right now about the loan that would make you happy?
So he made a mistake and got roped in to new car and bad loan. Most people fall into this trap. I mean there's like 3 posts today alone about people realizing their new car was a bad idea. Maybe not to this extreme (we still need to figure out where that 20k difference went). I like to think I'm smart and practical but I bought a brand new luxury car with my first job and got a stellar 9% loan. I didn't think twice about the interest rate until a year or two later. It was 10k+ underwater for so long. I didn't get rid of that money pit for 5 years! Looking at your age this happened at 24/25 so I don't see how everyone is writing this guy off as a total degenerate because he got a bad car loan and buys fast food...
Only you know if this is isolated or repeated events that will actually affect your financial stability. Past this one big thing, the car, are his spending habits really that bad that they will significantly hinder your stability and life? Us planners are drawn towards partners that can throw caution to the wind. Some "excess" spending in our frugal eyes comes along with the territory. I think if these are isolated incidents then you should talk it through, teach him, do some financial counseling, and help dig your family out of the hole. If you aren't willing to do that than you may want to seriously think about calling it quits right now.
Spot on. And the answer is the amount on the car loan is irrelevant to my family's financial future UNLESS it becomes a pattern and he does it again.
My savings rate is now 75%. If I pay the loan and an allowance that allows him to eat out daily, that would bring it to 63%.
It is not "can I" but "should I"?
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It is not "can I" but "should I"?
No.
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It sounds like the issue is that you've agreed that he should be responsible for paying back the loan but he won't be able to earn while being a SAHP, and that is on a fixed timetable. The issue is timing only(?)
I think that you should make the loan payments for him while he is a SAHP with an agreement that he will pay you back for the payments when he starts work when your (youngest) child starts (pre)school [get the year fixed, written and agreed]. I'd make the payments directly rather than as a part of his living expenses.
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OK a few clarifications please, need to check this:
Loan is $30k at 16%.
That means, due to the repayment timeframe he'll pay $60k, NOT that he borrowed $60k and the $30k went missing.
Maths time: What is the remaining principal, the remaining interest, and what is the fees for breaking the loan/lease? is this actually a lease situation where they pay for servicing or what-have-you as well?
He was naive, didn't read the lawyer-speak of the car financer and was possibly some combination of: upset, ashamed, and disappointed in himself. Perhaps he wanted to fix the thing without explaining his mistake because he hoped it would be done easily enough.
Glad to hear the SAHP was chosen due to aptitude and not income. So, your finances:
-Are they currently separate?
-What exactly was the plan once he was a SAHP? You'd pay for everything? I would guess yes, from the "allowance" question?
-How transparent are your finances? My DH and I took a couple of years to go from separate to combined finances, and both of us can see via our finance software (we use an old version of YNAB, lots of options though) how much money we have, where it's allocated, and when we've run out of, say, takeaway money.
-FIRE. You're 8 years away, how far away is he? It's your family now, so make choices as one. Your work might even pay for a few sessions with a couples counsellor or psychologist. Him being SAHP but not FI means things get sticky if he becomes SAHP to save you money/emotions about childcare and then has to go back to work and watch you be free.
I reckon the two of you can do this, but getting a third party involved (a professional)so he feels comfortable bringing the stuff he mucked up or is ashamed about to you will help. He might be hiding from the fact that no matter how you look at it, his actions hurt your family already, but as a family, you can both make it better. Both of you need to be a stable, honest, safe place for the other. No parenting him, and no "bailing out" - those aren't the right phrases for this.
Maybe start the conversation with:
"Honey, I love you and I take full responsibility for my decision to marry you and make a baby with you. I'm still glad I did."
Then explain it:
"You didn't realise how the loan worked, and that's fine. But when you worked it out, you didn't come see me straight away, and that's hurting our family now. We need a plan for our finances from now on that we both agree to, to get out of this together".
Then talk about your family's finances and what that will look like offer the next 1, 5 and 10 years. Listen to him a lot. A cash-envelope system might be the way to go. Do it with him, and that partnership is like having a gym buddy- motivation to show the other how well you've been doing and feel like an equal instead of a child/parent.
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Exactly. It is hard for us on here to contemplate but there is a reason these consumer finance places are in business. There are tons of people who just don't understand what they are signing. Again, save the labels. Let's just accept the fact there are lots of people who sign financial agreements they don't fully understand (but think they do) and once they have an inkling something is off they'd rather not know how bad exactly it is. Shame, guilt, etc. and head in the sand kind of thing.
If I'd have to label my husband for this, I'd say naive and overly trusting - certainly not cunning or malicious. And there is nowhere else the money could have gone to. They just tell them you pay $1,000 dollars a month for sixty months and hope you never do the maths to realise you are signing up to pay 60k for something worth 30k.
I have seen personally how repeat financial incompetence can destroy savings, trust, and a marriage just as easily as blatant dishonesty. Trust me, while lying SEEMS like it would be far worse, a nice guy who is completely clueless about finances can destroy your relationship and trust in him just as easily as a liar can. Ask my mom. My dad sounds alot like your husband - not malicious, more like naive or incompetent. She buried her head in the sand, and didn't take control. Oh sure, over the years they collaborated to knock down certain debts or talk about his issues with his business and back taxes, but they never really addressed the fact that my dad is really bad at managing money. Inevitably, they'd pay off one bad decision only to find more mistakes and oopsies a couple years later. Now she is about to retire and found out her husband has massive debts and has been squandering their home equity to pay for bills because he didn't want to tell her he didn't have the money. Again, he didn't do it on purpose, but his good intentions didn't really change the outcome. Their retirement is now in jeopardy. Please do not be so naive to think that repeat incompetence/inability to manage finances is somehow okay. Poor money management skills can be just as pathological as dishonesty. My mom also thought my dad would learn and he never did. You certainly don't have to break up, but a few quick lessons and a payment plan from you will not fix this. I really, really recommend you pull out the big guns on this and go to a marriage counselor who specializes in financial issues.
Either way, I feel for you. It is really hard watching a loved one make questionable financial decisions and worry about their financial skills when you know they are a great, loving person. In many ways, it makes it that much harder because you can't just abandon them or treat them harshly. I have been losing sleep over my parents' situation for the last week.
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Ideally, there would be a way for him to work it out himself without an impact on me (through a stressed and ashamed husband or a financial setback) or our son (through suboptimal Childcare). But this ideal choice does not seem to exist and the question is which other choice is second best.
You keep mentioning that you think childcare is suboptimal. I can only offer my experience - I thought the same thing and agonized about it until I actually had to send my son to one. Most days he loves it so much, he's disappointed if he has to stay home. He gets a great little play group, educated carers, everything I would work to provide for him if I were home with me, and probably better than I could manage on a daily basis. Don't be discouraged if that is the decision your family makes! It can be a really good experience.
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I do know people can change their finances. Many on this forum are good examples.
You should let him make the change himself and pay it himself. However, since you are the more financial savvy I think you should maybe look into getting a Line of Credit, preferably an unsecured LoC just for him but maybe even a HELOC. If your mortgage is almost paid you should be easily able to do this.
I am not sure how you get the 60K total at 16.5% unless there are a bunch of hidden signing fees, or maybe he was underwater on a trade-in.
Please share your real math details and we will try to help.
I am assuming, and rounding, a few numbers here:
CURRENT SCENARIO: 30K 16.5% 5y = $738/month = $44280 total = $14280 interest
BETTER INTEREST SCENARIO: 30K 6% 5y = $580/month = $34080 total = $4080 interest
Get that bank LoC and save yourself $10,000
LOWER TERM SCENARIO: Even better, keep the payment high and lower the term to 4y
30K 6% 4y = $705/month = $33840 = $3840 interest
If he can make a $1000 payment that will cut the loan to 2.7 years.
30K 6% 2.7y = $1000/month = $32400 = $2400 interest
If you can save him, and your family, over $10,000 why wouldn't you?
It is completely foolish to punish him by taking care of this debt, at a horrible rate, all on his own. The "Your problem you deal with it" attitude is not good for a marriage. I don't think you should pay it, but you two sound solid enough that you can co-sign or help transfer his debt to a better rate. Talk to him about it. "I think we can save $10,000 if we do this... I still want you to pay for it but I want to help find the best way to help you get rid of this debt as easy as possible. After the debt is gone in x years what long term goal should we focus on? (Vacation, college fund, house reno, FIRE etc.)." Maybe sign a little deal on paper between you two that even though the debt is now in both of your names it is his responsibility. Even better, if you can just educate him enough to get his own LoC in his name. Let him shop around at the banks, he should be able to find a better deal then he will no longer be so "ashamed" about this financial mistake. In a few years he can say "I once had this horrible car loan, 16.5%, but I found a better deal of xx% and saved myself thousands."
How do you share day to day expenses? 50:50? Are you making advanced payments on the house mortgage? Who makes more? Is he accumulating consumer debt on toys? The eating out daily is a real problem for a families' finances. Eating out constantly also doesn't sound like a great trait for a SAHP. What is the kid going to eat, fast food every day? I try to impose an eat out cash allowance only rule on myself. Date nights together are different. Does he realize he could probably pay the truck off twice as fast, and save thousands, if he ate out only once a week?
More baby talk, first congrats on being "over the moon" IVF is a big financial and emotional commitment.
As for child care, as others have mentioned, daycare is not the end of the world for baby.
Both my SO and I are highly educated, and good with kids, but we gladly send the little one to daycare for just under 8h per day. All this week they are doing a mini Olympics with a field trip to a local gymnastics club. Stuff I just couldn't do by myself. I do feel sorry for the kids there for 10-11 hours. But with the right schedule with your TWO jobs daycare is probably the best financial decision. Once your mom moves she can pick the child up even earlier or have one day a week be Grandma day. Asking grand parents to look after children full time is quite onerous unless it is really the only cultural option. Visit a few Daycares, some will make you want to run crying, but others will make you smile and feel good about the opportunities.
And I know it is far from your mind, but the comment above about the SAHP getting custody, child support and alimony would be a true concern if you are not 50:50 parents and roughly 50:50 earners.
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This post is mostly concerning your suggestion of asking your mother to retire early and babysit for you. I think that is not a good option as you would be jeopardizing your mother's goals for retirement and asking a lot from her. I'm sure my daughter would just love for me to babysit full-time as I am now retired, but I limit it to one day a week if I'm not travelling or being a snowbird down in Florida for a few months. Your mother has her life to live as well as you do, and she raised her kids (you) and it is up to you to raise your own children. My husband and I worked different shifts because we didn't want our kids in daycare, and believe me, it was a lot of work for each of us. My mother-in-law babysat one day a week for us and we so appreciated that and I would have never expected it from her, but she offered.
I would say most grandparents do not want to be fulltime caregivers in their retirement years. We want a relationship with our grandchildren, but we also want to enjoy what is left of our lives on our own terms.
Miss Prim
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This post is mostly concerning your suggestion of asking your mother to retire early and babysit for you. I think that is not a good option as you would be jeopardizing your mother's goals for retirement and asking a lot from her. I'm sure my daughter would just love for me to babysit full-time as I am now retired, but I limit it to one day a week if I'm not travelling or being a snowbird down in Florida for a few months. Your mother has her life to live as well as you do, and she raised her kids (you) and it is up to you to raise your own children. My husband and I worked different shifts because we didn't want our kids in daycare, and believe me, it was a lot of work for each of us. My mother-in-law babysat one day a week for us and we so appreciated that and I would have never expected it from her, but she offered.
I would say most grandparents do not want to be fulltime caregivers in their retirement years. We want a relationship with our grandchildren, but we also want to enjoy what is left of our lives on our own terms.
Miss Prim
This.
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This post is mostly concerning your suggestion of asking your mother to retire early and babysit for you. I think that is not a good option as you would be jeopardizing your mother's goals for retirement and asking a lot from her.
I hear you but my mum hasn't saved or made plans for retirement and lives in the bad end of town of a European city. She is chomping at the bits to move to a nice house in Australia, half an hours walk from world class beaches, enjoying her first grandchild...
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I am not sure how you get the 60K total at 16.5% unless there are a bunch of hidden signing fees, or maybe he was underwater on a trade-in.
Please share your real math details and we will try to help.
The car at the time was worth roughly 30k, then came taxes, admin fees, a special gap insurance and so on and so forth. 40k all up. That they apply a fixed interest rate on over five years and make it an annuity of equal payments.
My mortgage is at 4.2% but because the break fee is so high, breaking the consumer loans and refinancing at 4.2 instead of 16.5 work out literally the same. Because he got it as a business loan for his business (sole trader, which is not going well) he has no right to make early repayments etc. i.e he is even worse off than if it had been consumer finance
. Visit a few Daycares, some will make you want to run crying, but others will make you smile and feel good about the opportunities.
And I know it is far from your mind, but the comment above about the SAHP getting custody, child support and alimony would be a true concern if you are not 50:50 parents and roughly 50:50 earners.
As for daycare, if it was 3 days at 8 hours I'd be fine with it but 8 hours on 5 days seems like a lot for a three month old...
As for custody etc yes I have thought about that...
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This post is mostly concerning your suggestion of asking your mother to retire early and babysit for you. I think that is not a good option as you would be jeopardizing your mother's goals for retirement and asking a lot from her.
I hear you but my mum hasn't saved or made plans for retirement and lives in the bad end of town of a European city. She is chomping at the bits to move to a nice house in Australia, half an hours walk from world class beaches, enjoying her first grandchild...
In that case, it may be win-win to have her move down sooner rather than later. I thought from your original post that your mom was opposed to this because you characterized it as, "Call my mum for help, make her retire early, move to Australia and child mind." But you'd also need to buy into the idea that you may be called to support her more than you otherwise would have. Watching a child full-time is no piece of cake!
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-FIRE. You're 8 years away, how far away is he? It's your family now, so make choices as one. Your work might even pay for a few sessions with a couples counsellor or psychologist. Him being SAHP but not FI means things get sticky if he becomes SAHP to save you money/emotions about childcare and then has to go back to work and watch you be free.
Spot on. You have hit the nail on the head in terms of timing. Say he stays home now, then we would another baby if we can, it would be eight years before the youngest starts primary school. In other words, by the time the stay at home parent question is no longer a thing, neither would working.
In terms of costs, most of my costs are fixed and non-scalable. Ie I wouldn't move to a smaller house if I was by myself, I'd still have broadband internet etc. our joint groceries are really low because I buy bulk, freeze portion sized meals etc. So whether or not he financially contributes to us achieving FIRE has way more to do with the expense side (I.e. Not blowing my money) than with his income (which is low)
However, he is not aiming for FIRE.
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7. Let him declare bankruptcy AND go back to work.
My kid loves day care.
Tough love is real love!!
He'll never learn unless you stand firm.
(That means if you fold, he WILL learn... to take advantage of you instead of learning responsible finance. Not saying it's a conscious thing, just that the effect on you will be the same as if were. Both of you have to face emotional pain - him the pain of learning better finance, you of holding the line - or you will never reach a satisfactory balance. Since you've got to invest the pain anyway, be the leader and set wise financial lines in the sand and defend them without fail.)
A friend of mine had a grandma who ran the finances and gave hubby an allowance. He brought his paycheck home and gave it to her. He worked a modest job but they were happily married with multiple children. He died of old age and she outlived him many years, died with almost $2 million US in property and stock, not a penny of debt.