My Fiance and I Crunch Our Numbers
by Heidi Frounkeiler
Armed with detailed spreadsheets and statements—I recently had the “let’s combine our finances” talk with my new fiancé.
Despite past conversations about our income levels—I earn more—and some other issues, we’d never really bared our financial souls. But we wanted to get our finances in sync before the wedding next August.
I was so nervous my palms were sweaty. My own parents fought constantly about money, and eventually divorced. I wanted us to be a team, even if (just for now) I’m supplying more on the cash front.
Guess what? There were some surprises, a little negotiating, and ultimately a plan.
He was surprised by my $20,000 in student loans, just as I was shocked by his $20,000 in credit-card debt (mostly from an over-budget home reno).
While $40,000 is no bouquet of roses, we agreed that paying back as much debt as we can before the wedding was our top priority. At the same time, we plan to save. Here’s the breakdown:
- Pay off the $20,000 in credit-card debt completely at a rate of $2,000 per month. My student loans have a much lower interest rate, so we can pay the minimum for now.
- Save $500 a month to boost one savings account from $3,000 to $10,000 to cover our contribution to the cost of our wedding.
- Prep my home to become a vacation rental, since we’d take a hit if we tried to sell in this market. (We’re moving in together now, but we’d like to keep my house, if we can.)
It’s an aggressive plan, and it means no Monique Lhuillier wedding gown for me. But having a strong, unified fiscal start to our new life is worth a lot more to both of us.
May 22, 2011
By MP Dunleavey, Dailyworth.com
One overlooked item in the Schwarzenegger scandal is how easily his wife, Maria Shriver, was able to cut ties and move out.
Wealth and family connections can do that for a gal. But what about the rest of us?
Divorce lawyer Violet Woodhouse, author of Divorce & Money, gave me the following tips:
- Stay on top of documents. Know where bank and investment statements are kept, and get copies of your last few tax returns. “You need to know all the assets and liabilities on the marital balance sheet,” says Woodhouse.
- Be ready to come clean. If you faced a divorce, you’d have to disclose all your finances or risk losing your assets. Square things away now.
- Make a post-divorce budget. Could you support yourself and your family if you had to leave? How much would you need to earn? How much of an emergency fund do you need?
- Get credit reports. Check his, check yours, says Woodhouse. This gives you a window into his debts, planned purchases—and your own credit health, which is critical to rebuilding your life. Go to www.annualcreditreport.com.
- Get yours. If your spouse’s name is the only one on the title of the house, get it amended immediately or it might not be considered a joint asset. Find DIY forms at legalzoom.com.
Put it in writing. Is it silly or cynical to “prep” for a possible divorce? Send Canuworktomorrow your comments and join the discussion.