Married Couples and Money

The bride counts the money. Wedding expenses. Bride with a piggy bank

When we think of marriage, we think of wedding bells and dresses, flower girls and ring bearers, and a couple expressing their everlasting love to one another.

No party is as fun as a wedding and very few life experiences can alter your life in such a meaningful way.

I’ve written a few posts on love and relationships but I don’t think I need to remind anyone that there is a financial consequence to marriage.   In fact, I think most of us consider FIRST the tangible benefits of being with a partner more than the intangible aspects like character, honesty, integrity etc.

A perfect relationship is a balance of the two. A perfect compromise of tangible and intangible benefits. I’m going to talk about the financial pitfalls and benefits that come from marriage.  In this post, I’ve discussed some of the more intangible benefits.  Sometimes money and relationships can mix like oil and water.

Benefits:

1. Sharing expenses in a relationship and couple finances:

Definitely something couples discuss when moving in together but when married you need to take it to the next level. It goes beyond utilities, rent and groceries. It’s time to talk about retirement and spending habits, saving and buying a house.

Two people are better than one in this type of division.

To give you an example, imagine this scenario:

Jim lives on his own, he rents a $1400 one bedroom right outside of NYC. He has one car. He pays $300 between payments and insurance. Groceries cost him about $200 a month but he orders out a lot so it adds up to an additional $200. His utilities for electric and internet cable are $150. On the weekends, he likes going out to dinner/drinks with friends. His entertainment spends are around $300-$400 a month.

Jim works as a IT tech earning 75K annually or $6250 monthly. After taxes he brings home $4275.

Take home income

$4275

Minus

Expenses

-$1400 apartment

-$300 Car

-$400 Food

-$150 Utilities

-$400 entertainment

-$600 Misc.

Net savings to go toward personal savings, 401K and Medical savings accounts.

$1175

*This is a very simplified budget but you get the picture.

Now let’s look at Jane and Sam.

They are newly married. Jane works as a teacher and makes 40K. Sam works in construction and makes 60K between hourly and overtime. They live in the same apartment building as Jim and pay 1400 for rent. Actually their spending is almost identical. They spend 600 on food, share a car for $400, $150 on utilities and spend 600 on entertainment and $600 on misc.

Together they bring in $8333, after taxes it’s an estimated $5,833.

Take home pay

$5833

Expenses

-$1400 apartment

-$400 Car

-$600 Food

-$150 Utilities

-$600 entertainment

-$600 Misc.

Net Savings for personal savings, retirement and medical savings:

$2083 or $1041 per person.

The point of this example is that even though Jane and Sam both make less then Jim, their still able to save roughly at the same rate each because they are pooling together for their major expenses and budgeting as a couple.  This is one of the best financial things to consider when either moving in or marrying.  The couples budget is everything and couples who are able to leverage their joint spending will come out on top in the long run.

2. Sharing Manpower.

They say two people are better than one.  And I would say that when it comes to domestic tasks, couples find that they are able to get more free time by splitting it up.

I’m not sure this is the biggest financial benefit to being married but it can definitely pinch a few pennies and save a lot of hours.  Having an extra pair of hands  for 1) laundry, 2) clean, 4) grocery shop, 5) cook meals for the week, 6) bargain shop can add up to a lot of savings.

A single person only has so many hours available them, they have to either do these tasks themselves and lose some free time or pay a 3rd party to handle these tasks like a housekeeper, or eating out/ordering in, wash/fold services, and food delivery like FreshDirect.  They can either keep their free time to themselves to do other endeavors or pay for these conveniences.

3. Spousal Employment Benefits.

One of the biggest is insurance.  You can’t really quantify how important insurance is until you don’t have a job that offers it to you.  Then you’re either paying hundreds out of pocket just to get simple blood work done or you’re paying $500+ premium for a private insurance for married couples that still has a large deductible or copay.

One benefit of being married is that health insurance for married couples is generally cheaper than paying health insurance for two single people.

Being able to add a spouse to your work insurance is amazing and something only allowed for immediate family members/dependents by most insurance carriers.

For K and I, we’ve always had insurance that covered us through work.  But there was this one year that we had to go without and that was the sketchiest year I ever went through.  We never went to see the doctor because it was too expensive and we prayed neither of us were ever involved in an accident because how could we ever pay?

My job also has some married life insurance benefits that if I die, K get’s X amount and if K dies I can get X amount.  It’s comforting to know that we’ll have some fall back if (God Forbid) either of us ever pass away.

Pittfalls

1) Spending habits

Sometimes people can get so caught up in the love and the connection they have for the other person, that looking at habits like spending can seem like a non-issue.

You might look at someone who never seems to wear the same piece of clothing twice and never wonder how they can afford to such a large wardrobe.

You might see someone drive an Audi and not realize that their car payments are near $500 a month and it’s a squeeze with all their other expenses.

It’s not until YOUR money is commingled with your partner’s that you start to realize how small spending habits can add up to big expenditures.

For a long time my husband liked to play poker with his friends. He became so good his friends stopped playing with him. It was always, “maybe next time.” They were scared to lose money to him.  Eventually he joined some poker clubs in the city and played there once or twice a year. Then he found some casinos near us that offered poker comps and he would go occasionally there too. He loved the game of poker but it was bleeding us $500-$1000 every time he lost.

Thankfully he doesn’t play anymore, we had a pretty serious conversation about his gambling and now I have complete control over the cash. But it just goes to show how a small insignificant habit can turn into a ravenous expense.

The same story could be told with shopping addicts or forever entrepreneurs who can never seem to get their business off the ground.

The solution is to think long range about how your finances with your partner would work and weeding out financially incompatible partners out. In my case, I nipped out early what was potentially a serious gambling addiction.

I would recommend financial planning for couples before getting married.  Sometimes when things feel out of control, it’s great to consider a financial planner for financial help with married couples.

Expensive Wedding and Even More Expensive Divorces

“My husband and I, fight over money.”

People spend an average of $27,000 on a wedding.  Those are pretty expensive parties.  I don’t have anything against big fancy parties to celebrate the joining of a couple but when we start to look at divorce rates, those big weddings start to look like a waste.  It’s estimated that nearly 40%-50% of marriages end in divorce.  According to an article written by CNN, couples that spent more than $20K had a divorce rate of 1.6X more than those who spent only $5K-$10K.

In some ways marriage is a crapshoot, you can never know if some devastating skeleton is going to come out of your partner’s closet and change your whole relationship with them.

It’s when you consider that the average divorce costs $15K, marriages have a risk of being a financial hole once everything is said and done.

Then Add Children and Divorce

If your divorce included children, then there will likely be one party that pays child support.  There will still be an increase in housing costs because the divorced couple will need separate places for themselves and for their children.

It can be very costly and difficult to manage your time and finances when expenses increase and resources are nearly cut in half.

Unfortunately in some cases, divorce is the only option for two people who turn out to be incompatible to stay sane and happy.  But children can definitely make divorce messier and more expensive.

I’m not writing this section to make children sound like a burden but for the most part, nobody has children to make a profit.  They have children for the generational and personal wealth that it bring to a family.  We grow our family to keep tradition and create memories.

Nothing brings a family together like children, but nothing makes it harder to separate and divorce cheaply than children.


 

I would say marriage comes with a lot of different types of benefits but something we should never take our eye off of is the financial outcomes that can result from saying “I Do.”  Ignoring that important fact can lead to marriage troubles over money.

On the other hand, marriage can be a blessing that can pay itself back in ways that can’t even be accounted for.  For many, the risk is worth taking.

I hope you read this with hope in your heart and practicality in your mind.

Feel free to read my other relationship posts:

The Biggest Red Flags In A Relationship

Why Dating Culture Doesn’t Work Towards Marriage

Dear Single Friends, This Is Why You Are Still Single. Love, Your Married Friend.

Flashpass to Retirement: FiRE and LeanFiRe Strategies

Early retirement concept

“If only I didn’t have to go back to work.” I think this WAYY to often, especially on my Sundays before I have to clock back in for my work week.

My friends say, “Alex, I think it’s time for a new job. You’re burnt out. There’s another company that can be the right fit for you.”

But I think it’s much more than that. I think I just don’t like work. I don’t like feeling obligated to go and be somewhere at a certain time.  I don’t like commuting. I don’t like being on teams I didn’t choose for myself. I don’t like not being able to spend my time as I choose. And at the bottom of all those things I don’t like is the basis for a job. In college, I didn’t like not having money either so I went into the world and made a career for myself.

Sometimes I have to remind myself to grow up.  Like, having a job is just part of life. An absolute majority of our society NEEDS to work in order to put food on the table or clothes on their back. But then I started to wonder about an alternative. What if, I didn’t have to work? What would it take to live like that? Is it possible for me?

That’s when I came across FiRe or Financial Independence and Retire Early. I’ve been following Personal Finance on Reddit for a while and stumbled across the subreddit. It’s not just people retiring early at 50 instead of 63. It’s people retiring earlier and young at 35 and 40! I honestly can’t look through this subreddit without feeling a tinge of jealousy. I really want to be those people.  I want to know how to retire early. I also want to know how much I need to retire early.

The concept of FiRe goes beyond Personal Finance-which discusses getting out of debt, buying a house and paying for college.  As well as other difficult financial choices that neither high school or college ever prepared us for. FiRe is just specifically about retiring early and what it will take to get there and the kind of sacrifices you need to be willing to make.

Looking through the subreddit, I can’t help but feel…what’s the word for it? Ah yes, INADEQUATE. I feel inadequate because here are these 19 year old kids that are planning their hustle for the next 10-15 years to be totally independent off a job! At 19, I was buying Frappachino this and coach shoes that.  I was twiddling away my hard earned money because, at the time, I didn’t consider my minimum wage slave money to be……real money.  It was just money I was earning before I had a career; before I made a real salary.  Talk about regret over missed opportunity. Regardless, now that I’m aware this is possible maybe there’s time for me to turn things around.  I’m making 3-4X what I was making on minimum wage, so hopefully I didn’t miss too much of an opportunity.

Personal Finance and FiRe pretty much go hand in hand but FiRe is a long term game. Once you pay all of your debts and start really gaining wealth, FiRe commits to continuing to live a modest lifestyle until you reach your FiRe goal date. For people that are successful at FiRe, this means living at your parents home until you’re 30 or putting a $10K pay increase towards a portfolio option instead of taking a much needed vacation. It means couponing; living on a cash basis and giving up the convenience of the credit card.  It sounds so simple, “Just don’t spend money? I hate spending money, I only spend money when I need to!” But DO you? Do you REALLY??  Credit cards/subscriptions, Venmo are super convenient. For credit cards, any points you earn on the card are already spent on the overspending you did due to the “convenience.”  And we all like convenience. Retiring early means less convenience and less money spent on pleasures that we usually indulge in as a reward for hard work.

It takes an incredible amount of self control to retire early. Year after year, you’ll need to make sacrifices in your own indulgence, spending habits and choices. Vacation to Miami with friends? Nix that. Those really nice designer shoes? Nope. Weekly happy hour bar tabs with coworkers?  Um, no. Forget about the new car lease and living without roommates.  What you’re sacrificing in quality of life now, you’re planning to get back later when you’re able to retire 15-20 years early.

You’ll also need to be somewhat knowledgeable on tax laws. Should I invest in a 401K or IRA or both? What should I do after I max on my contributions? I’m about to surpass my income tax bracket, what can I do to minimize this years taxes? These are decisions you can’t just leave to the wind when planning an early retirement. Because year after year the wrong decision will cost you.

Once you start saving all this additional money, how do you optimize it to allow an early retirement? Well that’s entirely up to you. Some people invest in individual stocks, mutual funds or rental properties, or a mix of diversified options. The choice is yours depending on the skill set you have. Some people like to park their money and not think about it again until they need it, some like to be more involved in the trades, others like the idea of home equity. Some enjoy high risk, others low risk. To make FiRe truly effective you’ll need to take some risk to optimize your hard earned money.

Now let’s talk Lean FiRe. What is that? How could FiRe get any leaner, you’re already cutting out the pleasures of life! Oh it can get leaner.  Way leaner. Some of you may have read this article rolling your eyes, like “I don’t make that kind of money, Alex. I’m not overspending and there’s nowhere to cut.” Lean FiRe is early retirement for those who make an average or below average earnings. I swear, the Lean FiRe Reddit is no joke! They will make feel shame for your current lack of retirement plans. These are people making 40K -70k a year (or less!), and killing it with their retirement goals.

How do they do it? Incredible sacrifice and resourcefulness. These are people who really hate their job and are like, “Oh hell no! I can’t be doing this forever!”

I read about this one guy that ditched his car even though it was a 40 minute bike ride each way. Luckily he lived in a place where the weather was nice nearly all year round. He was saving money off of the weather! Other people are gardening and living off the literal fruits of their labor and land, thus cutting down food costs.

Then there are the people who are extreme in their housing solutions. One guy was homeless for a year! You heard that, homeless! Like, living in his car and showering at the gym while going to work every day and pretending he had a home. The moral of that story is that he really saved a lot at the time since housing is probably our largest expense. A lot of Lean FiRe people take to frugality and minimalistic living. There was one couple that bought a Tiny Home and lived in a trailer park. Their Tiny Home cost 15k and they bought it outright, then parked their home for a couple hundred dollars a month at a trailer park. They really didn’t need to earn so much money after that.

Theres also strategy to increase their income and put that money aside for retirement purposes only. These people were resourceful with their talents and skills.  They started blogging, and you-tubing to earn some extra cash. It’s a slow income stream but it’s cheap and easy to get into. Some opened etsy shops, making homemade soaps, balms, greeting cards, ornaments and whatnot. Some just did the good old fashioned way of getting a second job and driving Uber on the side.

Those Reddit subreddits really put me to shame. When I hear real life stories like that, I wonder WHY CAN’T I BE LIKE THAT?

Because I don’t want it enough. I’m not willing to sacrifice my daily pleasures or I do, and then I can’t stick with it long term. But practice makes perfect, and I’ll keep at it until I’m finally willing to make the sacrifice long term. In the meantime, I’m going to keep reading the inspirational stories FiRe and LeanFiRe have to share with me. Because with a little inspiration, who knows, maybe I’ll be able to retire early too.

Feel free to like, share and follow this post if you found it interesting.

Check out my other similar posts:

Why I Budget and How to Budget: Personal Finance In A Nutshell

and

Motivational Book Club: The Total Money Makeover by Dave Ramsey

 

Top 6 Ways To Maintain A Work Life Balance When Your Job Is Stressing You Out

Not many people can honestly say they have a good work life balance. I feel like I’m always chasing  paper or time. Time back from my commute, time for my family, time back from my overtime. There have been moments I’ve worked less and made less money. There have also been times I’ve worked more and made more money. But I’ve never worked less and made more money. And yet I keep finding myself chasing that elusive unicorn job.  The one where we have enough time during the day to get things done. Where we get an hour lunch break, where there some light politics but no animosity.   But while we are chasing for the perfect job we have to try to make the most of the job we have now.  Here are some ideas

1. Time Management: Is probably the best but hardest thing to master. Determining what can wait until the next day and what you need to do now based on priority. You don’t want to take care of all the non essentials and then at the end of the day scramble to take care of what you are now realizing is a must on the to do list. The best time management tip is this: take a few moments to collect your thoughts and make a list of what you need to do for the day.

2. Cutting BS activities: sometimes we engage in non essential work habits that we “think” are productive but are really a waste of time and causing your hours to be longer. Things like engaging in office gossip, constant bathroom and smoke breaks, the lunch hour that over extended result in reduced employee productivity. It’s ok to engage in these activities here and there but constant and daily disruptions to work will be noticed by higher ups and will extend your work day and make you less productive at work.

3. Delegate: I really struggle with this one. I really think I’m the best person to do the work so I’ll take on all the work I can, then I’ll burn out badly. Taking work off your shoulders and giving it to someone else might seem like you’re passing off your responsibilities but it’s really not. In a Corporate environment usually the workhorse takes on everything, sacrifices personal time and energy to get everything done. Do you want to be the workhorse? Everyone should do their share and if you feel overwhelmed don’t be afraid to speak up and give work off to others who are less busy, and then hold them accountable for their work.

4. Take Time Off: Take all your PTO, especially if it doesn’t roll over. Take personal days and sick days if your not feeling great. I usually take a mental day after a long project.

5. Don’t Be The Workhorse: Learn how to say “No I’m not going to do this. Not because I don’t want to but because I can’t.” Learn to say no if you think something might be unfair to you. The workplace is cold-hearted and everyone is vying for their own interests. My experience in the corporate world is that these companies can take the best intentioned employees, the ones that are passionate about their work, and turn them into human capital to be exploited for productivity.  Saying no sometimes allows you to create boundaries that are needed.

6. Live Closer To Work-Commuting sucks. I have a 2 hour commute round trip and If I could shorten it I would. Often we have to consider work life balance in the sense of, am I willing to spend more on rent to get time back for my commute? Right now I’m not in a position to move but do try to take into account heavy traffic times so I can try to minimize time lost in traffic.

7. Change Careers: I decided I wanted to be in real estate. I wanted the big money.  And after 5 years I finally have all the money needed to pay off my student loans. I’m also working 50-70 hours and work Saturdays. Even if I changed jobs the hours would likely still include weekends and evenings. I need a career that is more flexible, work from home, or I need to save more so I can eventually scale back the hours. Changing careers is not always feasible, definitely not at the drop of a hat, but I’m making serious moves to change that and free up some time, even if it means a pay cut.

Quality of life VS Cost of living. That’s always the underlying question when it comes to acheiving work life balance. I hope these tips helped Feel free to comment below your tricks to balancing it all.

Please subscribe, like and share if you find my posts helpful! 🙂

Check out my other posts Build An Eye Catching Resume And Get More Interviews and 5 Amazing Ways to Alternative Living. Live Outside the Box. and My Job is Killing Me….

Never Believe The Propaganda, Create Your Own Purpose

Corporate America is a necessary EVIL.    I’ve never made more money than when I worked in a corporate environment.  So I need this job to make money but why am I at this job?  Can your career give you inspiration to live the best life?

Propaganda: information, especially of a biased or misleading nature, used to promote or publicize a particular political cause or point of view.

I’ve been searching for the past few years for a job that can give me meaning.  A purpose.

I envision being part of a group that is warm, friendly and a team environment.   Surrounded by positive people, positive thinking and inspiration. We’ll go out for drinks once in a while.  I’ll also get an hour lunch.  The workload will be totally manageable with time to spare.  I’ll be able to take initiatives over everyone else and be recognized as a performer.  I’ll be well-liked and have good benefits/salary.

I would say 97% of the population does not have a job like the above.

Most corporate environments do not offer that kind of environment.

Why?

Bottom line.

Corporations generally are in the business of making money. Making money means squeezing all your resources for what they are worth, including human resources.  As soon as money is involved, individuals tend to get crafty, shysty and overall unfair to others in order to get a leg up.  And then big bosses and companies will turn a blind eye, because it’s not effecting bottom line or rocking the boat will effect a bottom line. Financial decisions don’t take into account emotions, personal development, or personal growth.  It’s only about company and business gains.

Still, many companies have mantras, company values, and goals.  Many of them include excellence, honesty, integrity, teamwork.  Of course you can try to buy into this.  I did. And every time I was disappointment when I was overlooked for a promotion or someone who totally lacked these values received a better review.  The reality is that these values are a stick and carrot method of propaganda, meant to keep employees motivated and drive revenue.

In reality, company culture/values is nothing more than clever branding.  A way to keep people motivated as well as sugar coat any negative culture the company has.

So how do you stay motivated? Especially once you realize that the company values is a load of BULL*****.  How do you keep the inspirational thoughts and inspirational quotes alive in your head?

Well, take a moment to think about your own values and financial goals.   “If I work here X amount of years, what can I accomplish?” “What’s my next step, If I find this company isn’t working for me anymore? Can I go and do my own thing?”  “Does the work itself give me happiness?”  “Will this help me get to retirement/financial stability?”

Having a reason in your mind will help you get through the hardest of days and the darkest of nights.  Patience and time will always be on your side, so keep at it.  But don’t believe the propaganda because truth always has a way of coming to light. And motivation built on false propaganda is like a house made of sticks.

One Of The Biggest Financial Decisions You’ll Ever Make

 

From about age 16 we hear this question over and over. “What do you want to do with your life?” “What degree are you getting?”

It’s difficult, what you choose at 18 or 20 decides a lot about your lifestyle. Maybe you’ll aim to be a traveling DJ with partying lifestyle. It’s flashy and fun but involves all your weekends and most evenings. You’re your own boss but have to hustle hard in the beginning to bring in clients. Or maybe you decide you want to be an attorney, you’ll need 3 years of law school and a lot of debt. You graduate in the middle of your class and struggle to get a job that will cover your living expenses and your debt. Or maybe you decide to go into banking, it was great money at first but now is going automated or overseas.

You get the picture, your career needs to last 30-40 years! That’s a huge commitment! You need to think longevity. Can your industry last 40+ years? Is your career mostly age/appearance related? What is the growth opportunity?  How will you grow and find jobs in your industry?  Are you going to enjoy your work enough to do this for decades? These plus many more questions have to be carefully thought out for your future!

The timeline goes something like this:

20s: finish college, flail around trying to figure out what works then find a niche. Start at the bottom.
30s:grind out security in your field/job. Maybe do other adult things like marriage/family.
40s: Some progression/growth opportunity may have occurred at this point, but still trucking along.
50s: start really preparing for retirement and sending kids off to college.

The point is that for most of us, delaying choosing a career or even frequently changing careers past your 20s is detrimental for financial/personal stability.

You can’t spend your 20s and 30s working in odd n end jobs and expect the same return as someone who settled in a career at 25.

This post is not to offend those living alternative lifestyles that appreciate freedom over security. I just want to encourage and inspire everyone to be very conscious in their choices. It’s easy to start off in a job with you thought will be temporary but end up with 6 years in the hole with little advancement. It’s easy to keep changing directions and then end up really nowhere but at scratch again.  There’s a lot of inspiration in life, you just need to find your niche.

What you choose as your career matters. You can switch your major a few times or change a few jobs but eventually….you choose a career or your career chooses you.  If you want to find a job, your dream job, then you have to start now.

I went to my 10 year high school reunion and it just a bunch of adults standing around saying where did the time go? As a follow up, I’m going to go over goal setting and achieving in another post. Hopefully more of us will be able to tackle our goals and be able to be proud of how our time was spent.  This post is about nothing else but love, good thoughts, positive thinking and motivation to inspire..