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I'm having marriage financial woes.
I come from a family of misers, my wife comes from a family which is nearing the bottom of the stairs with their silken slippers. Before we merged our finances, I was always wondering why she was never able to save, and introducing budgeting soon told me why. Our budgeting is virtual, which is to say we assign transactions to categories and there's nothing technically preventing one of us from overspending on a category. We still have our separate bank accounts.
Out combined income is about 175k (65% me). We each get a "personal" category which is funded by $1000 per month. This funds clothes, going out without the other person, gadgets, sports gear, whatever we want. To me, $1000 is overkill. I read other couples' budgets online and $250 is more typical. I save most of mine.
She managed to get into the negatives pretty quickly with hers. We kept on making exceptions for why we could recategorise her purchases, but soon she was -$1500. Eventually I agreed we would reset the balance, as long as she didn't overspend again. At half-way through July she was at $800 spent.
It's really having an impact on our marriage. She feels really bad about it, but can't seem to keep it under control. It's building resentment in me. We've still got a decent savings rate, but we're trying for kids at the moment, and we would go backwards financially if we had a child now. It's not just the personal fund, she consistently buys more expensive stuff in other categories. Even assuming perpetual DINK status, I'm pretty sure I would save more money being single.
She thinks she's doing well, and points out that her family would consider her a miser. I think even I'm doing poorly, and my family would consider me to be wasteful with my money.
I see frugality as a virtue, she sees it as a preference. She feels massive social pressure to not look poor. I'm quite happy to tell my colleagues that I can't afford to go to lunch with them.
She's not a feminist by any means, but does have a strong aversion to feeling controlled in any way, so I'm hesitant to suggest I have greater control over her finances.
Any ideas?
I used to have the same problem myself - I found it very hard to limit my spending to an appropriate amount when I was a student. What worked for me was having a literal pot of money on my desk. Every day, X amount went into the pot from the budget. I could spend whatever was in the pot but I couldn't spend anything else (literally, without going and getting some cash from the bank).
I think you can still set this up cashless. Make a little bank account (one each) with an attached debit card. This is your day-to-day spending and hobbies pot. When money comes in every month, all except 1000 gets automatically sent to a saving account with no attached card. So you can literally only spend what's in the pot. And you don't have to worry about sharing bank accounts this way, so no need for issues around being controlled.
On a different note, it's clear you have different intuitions and preferences so I recommend sitting down and discussing what you actually want to use this money for, in the long run. Early retirement? University fees? Cushion against misfortune? Having a more explicit long-term financial plan might help you both get on the same page.
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It will be much easier if you frame it terms of the percentage of her income she gets to ‘keep’. Whatever hers minus $1000 (assuming you’re handling taxes) is, she should transfer to you every month. The remainder (her $1000) she can do with what she wants. She will still ask you for money, but her having to do it every time will remind her of her profligacy.
I won’t be able to combine finances with my partner for tax / IRS reasons (one US citizen spouse, one foreign spouse, both living outside the US is a nightmare if you want joint finances), but I’m kind of glad about it anyway. It’s way too much drama, if one partner is much richer it’s better for them to either hand over their card (if enough trust is there) by doing the Amex secondary card thing, or to pay the other person a set amount each month (if the trust isn’t there).
I have a coworker who constantly gets notifications from his shared bank account whenever his wife spends their money. Seems like a recipe for relationship resentment if you’re hard at work and you’re getting pinged with every purchase on her $10,000 Harrods shopping trip, even if on some level you accept it/are fine with it.
Shouldn't it be more like "whatever's left after deducting shared expenses she can do with what she wants"? The 1K discretionary sounds a tad lower than that (depending on the magnitude of those expenses of course) if she's making 35% of $175K.
That's one way of doing it. Realistically what this will look like after 10 years is that I will have saved up a lot of money and she will have saved up almost none. Then when we go to buy a house, the deposit will primarily come from me, partly because I earned more and partly because I saved more.
The earned more part I don't have a problem with. That's what I signed up for by getting married. My money is our money. But the saved more part makes me feel like a schmuck. Why should I be sacrificing more for that goal than she?
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Sure, that's as good a way, it depends on how much room they want to give each other I suppose.
Just that considering the numbers here, it seems like part of what's going on may be OP imposing his taste for saving on the wife -- if she's making ~60K, that's probably something like 4K/month after tax in the US. If they live someplace expensive I guess they might be spending 6K on general living expenses, but given the 'frugality' aspect of OP's personality as described I'll bet he's got a fair chunk of the wife's money going into savings. If she doesn't want to save as much as him, and he wants to make her by imposing an artificial cap on discretionary spending, it's not clear to me that it's her (or her spending) that's the problem.
Well, yes and no. Yes, because 90% of all the bills come from my account, but no, because if she'd paid "her share" she'd have almost nothing left. I think this is part of the problem. Because all the bills are coming from my account, she has quite a lot of money left in her account, and this makes her feel like she hasn't spent much. In fact, she "saved" $10000 in her account over the last 9 months or so, and was quite proud of it. Pointing out that this number wasn't very meaningful because only 10% of the bills came from her account didn't land very well.
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Man I feel your pain, my girlfriend is certainly a spendthrift, even if both of our finances are in the red, it's really not a big deal for me since my family is like 1 or 2 OOM richer.
At least she's self-aware about it, and has already committed to giving me control of the purse-strings when we're making actually reasonable salaries abroad or getting married.
Is there some way to automatically shift the money you're budgeted to spend to a different account, so that it can't be mixed up with the discretionary spend? You can frame it as a way for her to control herself better, if you guys can both agree that dipping into the joint savings account should require both your approvals.
Your family is up to 100 times richer than your girlfriend's? India is an unequal place, but that still seems pretty large, especially since you've noted you're far from very rich (at least by Western standards).
Sure, now that I think about it, two OOM is probably an exaggeration, it's closer to like 10-30 times.
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This is what I see as the next step, but getting there without her feeling like I'm controlling her is going to be difficult.
Also, she's going to need a new phone soon (she's somewhat locked into iPhone out of habit). Realistically that would mean saving up now. What am I going to do, tell her she has to be phoneless until she saves up the money?
I see phones as being so important both as an essential and for QOL that I wouldn't begrudge the additional expense, but I'm sure you have your own priorities, at least if her current phone is in working condition.
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This makes me feel maybe you are overdoing it a bit. Unless your colleagues regularly lunch in Michelin star restaurants, you should be able to afford a lunch. You may choose not to go, still - though I always found it's good for team relationships - but you should be able to do it without having your budget ruined.
I think there are two issues at hand here. First is "keeping up with the Joneses", with the Joneses being your wife's family. I think it may be a good thing to talk about how comparing their lifestyle with yours is not a good idea - they do their thing, and your family does yours, and the only two persons that should have a say in it is yourself and your wife. If you both think something is ok, the others should not have a voice to call her a "miser" and she should not feel obliged to live by their standards.
The second question is what your wife wants. You should come to agreement about what are your goals, and you should talk about how wasteful spending makes it harder for your to achieve these goals. Don't make it "you bad, me good" conversation, make it "how we can make it happen" conversation. And yes, it may create some resentment, at least initially, and if it proves hard for your wife to follow through with what you agree - there might be a moment where you have to choose - either you risk a conflict by taking more control over it, or you find means to increase the budget so you don't have to do it. Only you can make this choice.
Lunch costs $40 here. I can afford it with my $1000 budget, but I prefer to spend on my hobby, when I do spend.
We're actually on the same page in principle, pretty much. It's just that she feels like she's already denying herself a lot, but somehow the numbers at the end of the month say otherwise, and she gets defensive about it.
This is a recurring theme. My upbringing shaped me, of course, but I don't care that much what my family thinks of my lifestyle. She was recently in her home country for her sister's wedding, and the amount spent on gifts and clothing was mind-boggling to me. She describes the lives of her sisters and mother as vicious social status seeking, but she can't help but be sucked into it to a milder extent on occasion.
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It sounds like, while doing quite well yourselves financially, she's surrounded by even wealthier family and friends. She feels a bit self conscious about this.
Do you as a couple have any less wealthy friends you could spend more time with? Or at least friends and relatives who aren't exerting social pressure on her to overspend?
This is especially important when/if you have kids. Are these friends/family going to be making her feel bad about only putting her kids in an ordinary charter or private or decent public school when theirs are in boarding schools where they each have their own horse or something?
Personally, I have two little kids, and am a working mom. Several of my friends are stay at home moms who like to organize activities on weekday mornings, and like to talk about aesthetic mothering and homeschooling and "morning baskets" or things like that. This is not something I can participate in very often, or I'll feel angry and jealous. Why are they making aesthetically pleasing morning baskets with their friends on Wednesday mornings, and I'm working a regular job?
The solution is, honestly, to focus on different friends, or at least in different contexts. In my case, it's important to me to talk with different people, who are not all raising goats and looking orderly. In your wife's case, if she's serious about her family, it might look like emphasizing some friendships with people who wear clothing from chain stores, pack their own lunches, and send their kids to public school. Does she have any friends like that?
We moved here relatively recently and are both struggling to fit in socially. I'm less affected because I just go and do my hobbies; she has suggested that the isolation is contributing to her spending. We have a few friends now who also don't seem to be spending large, and that helps. However, she spends time with some girls in the city occasionally. A lot of these are single and waiting for a man with a house and a car to sweep them off their feet, and in the meantime not too concerned about saving money.
But on the whole it's her family and upbringing. She comes from old money that is on its last legs.
I take your point on the whole though. I think it's something we/I can focus on, finding friends who are also more future-focused and frugal.
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Bruh. A better way to put it would be to characterise your family as savers and/or investors.
Consoomers.
It appears she doesn’t actually feel that bad about it, by her revealed preferences.
Yes, a pressure that is readily absolved by spending money that’s 2/3s earned by your husband.
Ugh. Stupid husband, how dare you be so controlling over our money, much less my money?
Perhaps you can make a simple Excel model to show her how your household net worth can grow using a given spending/savings rate, and a given rate of return on investment.
The takeaway for her being: more savings/less spending now, more money with which to flex later upon the Jones’s, other randos, and social media.
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This is a category where the conventional wisdom fits really well in that opposite spending styles cause a lot of marriage woes.
My experience with this across quite a few friends and their partners is that with this sort of coupling is that it invariably ends in one of roughly three (I'll outline four but two are variations on a theme) stable ways.
The first is the end of the relationship - there's not too much to be said here. I don't think this is a huge risk for you personally, as this is a more lower-income sort of end. If she's not outspending your actual income then the chances are much-reduced.
The second is that she gets what she wants, which is license to spend what she wants. For some spenders this has an inherent limit and will be satisfied, at which point this largely resolves itself. If her spending is more social - lunch with the girls, keeping with fashions with her friends, etc, etc, this isn't too uncommon. Lots of people feel the urge to spend more to keep up with the Joneses, but many simply want to keep up and don't feel the need to spend incessantly. Lunch, dinners, hairdos, makeup - a lot of women just need these things covered for social reasons which to me is very fair. If she has a compulsion to spend her money no matter how much she has... well, GOTO 1 or 4.
The next two are very similar and differ mainly by degrees but because they play out so differently psychologically I've listed them separately.
The third is when you have auto-payments deducted out of your accounts into non-spending accounts that are hard to access. Savings accounts with no cards attached, 401ks, etc. These automatic debits come out on payday. Once that's done, what remains is spending money. Usually this means the two of you separate out, say, grocery money (a buddy of mine used store gift cards to manage his grocery budget with his girlfriend which meant any further spending had to happen from her spending money) and such, and potentially have a third account for other automated spending like bills and such. In short, making as much of the process as automatic as possible so any spending blowouts are constrained.
The fourth is very similar - money goes into a central bank account under the control of the 'saver' spouse and the 'spender' is given their allowance automatically once a month/fortnight/week. They can still log into it and transfer money, but there's an understanding nobody is going to do that. This is more extreme than 3 and is more when someone has a spending problem, can't control it and needs just to have a card with limits. I have seen this work well with my grandparents - my grandfather always spent money like it was going out of style so my grandmother would always give him a cash allowance for the week to spend and managed the household herself with the rest.
The theoretical fifth is that she just starts budgeting well by herself, falls in line with your spending philosophy and all is well. I have never seen this happen but have included for completeness' sake.
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Maybe use prepaid cards that you load up at the start of the month for spending money? You could get one too so you're both in the same boat and it comes off as less controlling.
Was she on board with the $1000 limit when you started it? If so I think you need to drill down into where it's going and discuss specific ways to reduce it. Maybe stop hanging around the mall as much if it's impulse purchases (for example) and walk around a park instead. Or meal prep together on Sundays if it's eating expensive lunches at work.
My wife and I have a rule that we check with each other if we're spending over $100 and I've found that helps quite a bit. We very rarely disagree but just the fact that we have the conversation has made me reconsider a few quite a few impulse buys.
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Perhaps therapy for her? Especially if she is spending for social reasons to fit in.
Does she have a specific category where she spends the most? Eating out? Fancy clothes? Etc? Possibly find a way to cut down on specific categories of spending, by not being a miser in the category and spending to be a little fancier, but avoiding the most expensive options. For example rent the runway for clothes, or blue apron for fancier meals. Both are more expensive than the miserly options, but both are cheaper than careless spending.
I probably spend 500-1k a month. My wife probably spends 1k a month. But she also tends to buy all the kids stuff. Our dual incomes are higher than yours so that is still a net positive income. Would it be possible for y'all to earn more money while keeping the spending stable?
Depending on which category of spending your wife is engaged in having kids might actually lower her spending. If it's going out ... She won't be able to for a while. If it's shopping ... Then it might get worse.
She is in therapy. Not specifially about that, but she talks about this too.
It's mostly online shopping, so clothes and handbags. Makeup and getting nails and hair done as well. Coffee and going out with friends.
We've both received small pay increases recently. I've been keeping my eyes out for new jobs, but I'm not finding anything that pays more so far.
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