The Gray Area of Making Financial Decisions In a Marriage

doggies-have-weird-faces
The most opposite of faces…just like me & my hubby.

Balancing money and marriage is hard work. I think hubby and I have it figured out together pretty good. Even so, no marriage is airtight when it comes to money and squabbles. When we got married, we didn’t discuss in-depth finances. You know why? Because we didn’t know what investing or what any of that money stuff was. That’s how young and green we were. We agreed to budget with each other and tally everything but we made no verbal or written agreements on the details of the mortgage, emergency fund or investing in general.

It would be easier if the financial ‘offenses’ we’re going to dive into today was less hazy. It would have saved me a lot of time going back and forth from “Am I a pushover if I don’t get mad?” to “Oh, that’s nothing. He did it for the greater good.

I know the written words a person chooses is a lot more telling but I tried my best to construct this piece with a mild & level point of view of what happened. He’s not in trouble. There is no screaming in this post.

First Time

The first time hubby made a financial move behind my back was a few months after we had moved into our new house back in 2015. He wanted the mortgage pay off to be even at exactly XX years instead of XX years and 3 months.

Hubby took an extra paycheck or two and sent in a large payment of $20,000 to the mortgage company. He didn’t call in to tell the mortgage company that it was supposed to be a “lump sum payment” so most of it went to the interest on the home loan. D’oh! Plus our mortgage interest was 3.75% and the stock market in 2016 did much better than 3.75%.

I was grumpy with him because he didn’t give a simple whisper about the lump sum payment until 2 months later when I was looking at the remaining mortgage balance online and said: “wait, how did the mortgage loan number drop down so quick?” Then he told me he snuck in an extra payment because he wanted to even out the numbers and I was left going “hmm.”

Second Time

The second time hubby made a financial move behind my back was last month in February. Except I’m not that mad at him this time (not that I can say I’m over the moon about it either). We front loaded his 401k (all $27,500 of it) in January at the peak of the market so seeing 10% of it go bye-bye within 2 weeks probably didn’t vouch positively for his psyche.

When the market correction happened, he dipped into our emergency fund to the tune of $11,000 and threw it into my IRA for both the 2017 and 2018 year. He was planning to throw money into my IRA eventually but the dip seemed like a good buying opportunity. Unlike the mortgage where I sort of found out months down the road, he told me he’s transferring $11,000 out of our emergency fund the day after he did it. He just said it in passing after the deed.

Team Lily:

“I think I’m fairly sane when it comes to balancing control in a relationship. Usually, any financial transactions under $50 we make can slip by without an explanation from either party. A guy needs his own time and his own space just as much as a good steak once in a while. But you know…those money moves at $11,000 and $20,000 each isn’t chump change. That’s quite a bit of money to move without a whisper before the actual execution. And it’s not always about the money, it feels disrespectful to begin with when a big amount is moved without your knowledge.”

Team Jared:

“Although they were large sums the directed final goal was for a unified one that is for the whole of our family. It was not squandered on ‘hookers and blow’ but it was put to use on our mortgage and taking money set aside to stuff into your IRA at an opportune time. They appealed to me as universally good moves for both of us so why should I have to ask?”

Team Lily:

“That’s more of the point. For a unified financial goal, shouldn’t it be easier to communicate with me even if it was just a whisper? Even if you won’t count my opinion (which is fine, I’m no investment genius) still shouldn’t I at least know before the confirmation and execution of the action?”

Team Jared:

“The household I grew up in was financially controlled in totality by my father. My mother makes the dinner and raises the kids. In their 40 years of marriage, she has never made a splash or shown interest in any finance. She gets an allowance from my father and asks him for money when she needs to buy something.

Although that is not our relationship, the upbringing I had does set a precedence for my passivity in this matter. Plus, you don’t do the bookkeeping of where the money is exactly anyway.”

Team Lily:

“From observing the way you do laundry and other basic daily tasks, even unconsciously, I can tell upbringing and the closeness of your family has had profound effects on you. Also, I discounted that engineers are not the most communicative creatures in the first place. I also discounted that you are wrangling with work which makes your time limited – especially during open market hours.

A dangerous thought: you are the breadwinner by a long shot and although that slope is slippery, we both know the slope is there and the financial balance will never be equal. That’s why there was no screaming match.

For reference, I would have definitely vetoed the way you paid the mortgage because 3.75% interest rate vs money invested during a bull run is a no-brainer. I would have also mumbled that the emergency fund was an emergency fund. Market corrections and IRA stuffings are not emergencies. What if you were let go from work and we only had half the amount we needed?”

Team Jared:

“From a working professional standpoint in my industry, it would be a hard fight to “get fired.” They would need to put me on a performance contingency for a year before even considering letting me go. The emergency fund that sits there is of no use because our money regenerates very fast as long as I am employed.

The emergency fund concept does not apply as drastically to us since we’ve already achieved a degree of hyperfrugality. And we have multiple sources of income from Airbnb, dividends, petting sitting, and lots of other littler things.

Once the emergency fund is loaded enough, I treat the extra like side cash for market dips like the one we just had. We didn’t have $11,000 worth of extra but we had some extra. The last time I told you about a money move when I sold some stock, you barely cared or had an opinion about that.”

Team Lily:

“You didn’t redefine the rules of the emergency fund last time…

In a way, I’m happy you are no longer reluctant to invest compare to when we first started where you took the sure fire 3.75% mortgage. Had you given me the above reasoning of “it’ll take a year of warnings before you’re even close to being fired” I would have agreed to throw $11k of the emergency fund and hoped for the best in terms of calling a bottom.”

Team Jared:

“Calling the bottom wasn’t the primary drive. It was one of the last few chances to toss in those pennies for your IRA. The extra “10%” discount was just the icing on top and it was at best only a little tempting.”

Team Lily:

“Mmhmm. Doesn’t discount that you could have just told me.”

Team Jared:

“I told you 1 day after, there was still time to reverse the transaction because it hasn’t technically gone through yet. You didn’t tell me to reverse it. When I sold AMZN, or BKE, or got rid of the VRX you didn’t care about hearing those.”

Team Lily:

“But when you make a money move without telling your spouse, to me, it just seemed like you were set on doing it. So it seems like I’m coming in looking for a battle if I disagreed.

It’s not even about the money, I just would have been liked to be told about it.

Selling those stocks is money gained to me. The 2 scenarios I’m talking about is categorized as spending because that’s cash leaving for something. In my mind, I frame one as a surefire gain and the other as a potential risk and loss. For potential risks in large sums of over $1,000, I want to know about it.

But I am really happy to see you are controlling the accounts compare to before. I love your determination for unflappable action and I like you don’t have to poke for reassurance on a money move constantly. You’re intelligent and a leveled investor like your father is. I have strong faith in you all the way through but I don’t accept blind faith in anyone. I want a notice and/or footnote in the process for any transaction larger than $1,000 even if it’s to tease my curiosity.”

Summary

Well, that was roughly our situation on the whole marriage and money topic. He did agree but it felt like scolding was what got me here rather than a total enlightenment.

I really had a hard time telling myself how to feel. I think we both won and lost something in the end. We won an understanding and lost a layer of ego. The communication (the entire thing you just read) was the most important outcome here. Which team do you side with? If you had to choose one: did I overreact or underreact?

Sidenote, I really want to steal Mrs. Groovy’s trophy case The Groovies scoreboard thingy. Seems quite useful at times like this. Perhaps they should look into production and sell them online.

I really liked this comment below because it highlights another slippery slope between non-communication in marriage. The big downside is it could snowball into things larger and more regrettable later on…

Also, just as a warning, you can be doing something “for the good of the family” and still have it be financial infidelity. My father made a lot of bad investment decisions behind my mother’s back which he thought were for our benefit. He lost e-v-e-r-y-t-h-i-n-g not just once but multiple times trying to regain his losses. And it’s not just his losing money that made it bad. Even if he had made a fortune, the lying / thinking he alone had the authority to make these big decisions for the family in itself was unconscionable. Take it from me, that sort of dynamic in a marriage is toxic. Avoid it if you can.



46 thoughts on “The Gray Area of Making Financial Decisions In a Marriage”

  • Team Jared, you are young and foolish. Yes, you are. I said it. How long would it have taken you to ask Lily about those big money moves? 2 seconds. You could even have told her, rather than asked. By talking to her BEFORE you made the moves, you would have been treating her as a partner. I, like you, was a jerk, and did financial stuff without telling my husband in the early years of our marriage (bought a $900 plane ticket because I got the travel day wrong, for example). I finally realized, after justifying my behavior for years, that it was indeed me, who was being the immature jerk by not telling him what I was doing with the money. I was making knee-jerk decisions (and justifying them as “something we’d talked about for a long time”). Don’t be like Young Me. Talk to Lily. If you get the urge to make another knee-jerk decision, remember your past mistakes and make a wiser decision.
    [email protected] recently posted…Ladies, Time to Figure Out Your Worth #WomenRockMoney

  • Wow to be honest, when I saw the dollar sign sparking around 20k and 11k, I did think about what I’d do if Mr. FAF did the same thing. I’d be livid. Yelling and shouting will be in order. It’s my money too! But after I read Jared’s side of the argument, it does make sense. He wasn’t throwing money on gambling or other women which are things lots of men do behind their wives’ back. It was for the family’s future.

    I’m glad you guys reached an agreement. We didn’t make lots of money, so it was easy for me to spot any large amounts of money going out of our joint accounts (in the hundreds or thousands). But I know through my interview with Mr. FAF he did go behind my back to go to Starbucks and eat out with his friends. I was not happy when I heard that.

    Communication is a problem we’re still working on in our marriage too. I have expectations that I don’t usually articulate to Mr. FAF. He also has plans that are great for both of us but don’t tell me and just does his own thing, which drives me crazy. We argued about money A LOT when we first got married, but now we’re almost on the same page. We argue more about parenting, household chores, and his passive aggressiveness now.
    Ms. Frugal Asian Finance recently posted…What To Do When Your Spouse Wants To Travel Alone

  • I think you guys did well. You talked it out and now he knows what to do. Good job to both of you. I make contributions whenever I can and Mrs. RB40 doesn’t really care. She trusts me now. As long as we have a good cash cushion, it’s not a big deal to her.

    We had our arguments early on too. One time she was out of town and I got a new convertible. I went to pick her up at the airport and it wasn’t a pleasant surprise like I imagined. 🙂
    Joe @ Retire by 40 recently posted…Screening Tenants in the Spring Is Like Online Dating

  • There is a big disparity between Ms. Blue Ribbon and my incomes, however, I try to go out of my way to include her in any changes to the finances. The only thing I don’t is when I need to make tweaks to the budget due to a bill going up a few bucks a month.

    Even when she fully doesn’t care about the decision I am trying to make I still want to bring it up just in case she has a different idea of how to execute the plan. HOLY CRAP I can’t imagine dropping that much on a mortgage or into an investment account without bringing it up.

    Bonkers.

    (PS…if you catch the issue soon enough my credit union is able to correct a standard overpayment over to a principle only payment without any issues. Surprised if yours wouldn’t be able to.)
    Budget On a Stick recently posted…Our Walk With Cash Budgeting

  • in our house we have our own “blow and hooker” accounts but i always run anything major by mrs. smidlap, because she’s nice. i have been directing the investment accounts for 10 years now and she trusts that. i do like to run stuff by her for any big transactions in those, still. that’s a nice looking black dog.
    freddy smidlap recently posted…We Do It Without The Buzzwords

  • I agree with your point of view, and $1000 sounds like a good threshold for talking about it. It doesn’t happen often to us since my partner’s usually blabbing on about what stocks he’s about to buy or how the market’s doing today 🙂 We are also using Ynab connected to all of our bank accounts, so I can quickly see money going out.
    Jess recently posted…Review: Everlane Mid-Rise Skinny Jeans

  • I don’t think you’re overreacting at all. You want to be involved in the financial decision making and have made a very specific, actionable request for your husband to keep you in the loop. If you weren’t interested in the finances and had given Jared the OK to make decisions without checking in then his actions would be totally justified (since he would have been following the protocol you two had already established). But it clearly irks you not to be notified of these larger transactions and your husband should respect that.

    Also, just as a warning, you can be doing something “for the good of the family” and still have it be financial infidelity. My father made a lot of bad investment decisions behind my mother’s back which he thought were for our benefit. He lost e-v-e-r-y-t-h-i-n-g not just once but multiple times trying to regain his losses. And it’s not just his losing money that made it bad. Even if he had made a fortune, the lying / thinking he alone had the authority to make these big decisions for the family in itself was unconscionable. Take it from me, that sort of dynamic in a marriage is toxic. Avoid it if you can.

    • This is SO insightful and I will read him your comment tonight. I mean, you basically kicked my ass in terms of making an argument. I’ll put your comment into the post (with credit) if you don’t mind.

  • Man, marriage is tough!

    I would be hurt too but I think Jared did it not purposefully to hide it from you, just more that he forgets to tell you (similar to how he forgot to tell you something previously- like the neighbourhood block party and left you that card on the table). $10,000+ is no chump change and it is definitely something to talk to each other about.
    GYM recently posted…Alternative Travel Hacking: How We Got 4 Nights in Mexico for $50 and 2 Nights in San Diego for $20

    • That’s what I think was part of the reason. He forgets and delays it and then go…whoop, well I’m already here so and she’s gonna be grumpy either way.

  • I think it’s important to talk about it first. I’m totally Team Lily. My dad managed investments exclusively. He gambled a few times and lost really big, and I don’t think my mom ever forgave him for not consulting her on that last time. So it’s really a slippery slope. Anything in the thousands deserve at least a mention.
    Jeannie recently posted…Top 7 Personal Finance Analysis Posts and Tools

  • It’s really good that you two communicated about it and made a point to your husband that you should be involved in any big money move that affects the both of you guys. The key here is talking it out so the both of you know how you feel about money transactions.

    • Great point Kris! What tripped him was those two moves were financially universally “good” – like pay your mortgage early, put money into your spouses retirement etc. and he didn’t see it as “bad” because the overall intention was good.

  • The fact that you both are thinking along the same line, which is to save as much as you can so you can to be financially independence is a BIG win in a marriage. Many marriages have opposite thinking when it comes to finances. What would you suggest for those who are in a relationship where it is spender vs. saver type?

    The deal between you and Jared seems very fair to me – $1000 is a lot of money.
    Mr. MFC | Morning Fresh Cent recently posted…College Education Cost Expected to Increase to $88,823 Per Year

    • Ohh I’m not the best at that question. I didn’t last long with a spender because…well I’m hard on saving. But it really depends on much the spender vs saver differ too. Sometimes spending a little is good, loosen up etc. I use to do the 50/50 rule when I went makeup shopping with friends. I say no to a purchase this time and the next time if I wanted something then I’ll get it because I resisted the last time. So yes, no, yes, no, no no, yes yes etc.

  • Yikes,

    Pulling moves like those of team Jared would definitely not fly in my house! You took the situation with a lot of grace and poise from the sounds of it.

    Marriage is tough, and it’s hard to remember sometimes that we’re not just individuals anymore, but on a team…team Frugal Gene.

    Like any great team, when individual priorities trump the team’s mission, people get upset and it suck energy away from their ultimate goals!!

    Thanks for sharing so transparently Lily!!

    • Omg I love this Matt! Yes team FG!!! I really wasn’t mad, a little hurt, it’s good that I have this blog as an outlet (and I won LOL)

  • I can understand where Jared is coming from. I’ve been handling the investment side of the house for pretty much our married life and my wife probably couldn’t tell you the difference between a stock and a mutual fund. She just isn’t interested and figures I’ve got it covered. About the only time she asks questions is when there is big market news, and then it’s usually a question like, “should we have any stocks at all?” or “should we buy some of that?” that is really hard to give a short answer to. In general I give her a yearly update entitled “What the Hell do I do if He Croaks?” that puts things in perspective and should I actually pass has advice and rationale about what I’ve done and why and where to go for help. That said, you have now made it clear you want more information and inclusion in the decisions, which should be respected. So IMHO your point should be less about the past and more about what you would like in the future in that you would like to weigh in both to understand the reasoning behind his action and so you can learn should you ever need to act on your own either temporarily or permanently.

    • I literally just read this aloud to my husband (we’re having dinner right now.) This is EXCELLENT advice. I totally agree especially with your last paragraph too.

      I don’t like numbers/stocks as much as he does. He wraps around the concept of taxes and numbers a lot faster than my mind as well. A lot of his interests puts me to sleep and my interests (writing) puts him to sleep/stress.

  • Everyone’s all put down the good points, and Ms. YAPFB outlines it succinctly.

    I would side with you mainly on this. Working as a team, you play to each of your strengths. One may play great offense, the other defense. One may be able to execute finer details, the other orchestrates the wider vision.

    Having another person to consult decisions is highly advised, even if it is time sensitive.

    For now, I discuss things with my Dad. Right now, I’m still involved in high risk stocks, where the value can now fluctuate ±100k’s in a week. My Dad being more conservative in nature questions my motives, and whether it is emotional gambling or decisions based on a logical framework.

    For now it’s cut down retirement by half, but it wouldn’t take that much to go back down to zero.

    • Great idea Will, I think usually I’m the wider vision person and hubby is much better at the details. Which is why I’m not too angry, I think despite the dollar amount they are sort of detail decisions anyways.

  • OK not to be mean, Team Jared, but not only did you make big money moves behind Lily’s back, you made foolish big moves. Even if you could justify it (and I’m not saying you can) with the excuse that you grew up in a culture where men made the decisions, you’re not even making smart decisions. Please don’t do it again or I’m going to have to hire our secret artist to come up with a special Fight-O-Meter just for you two. (Thanks for the shout-out Lily.)

    Lily, you’re not overreacting. Jared will soon realize he can’t hide anything from you if his life depended on it. The funniest thing Mr. G thought he got away with was when he took a flight with his brother, and for once, I didn’t arrange the travel alert on his credit card. He told me he’d take care of it. The next time we saw his brother he needed to cough up some cash to pay back his brother because the credit card company locked down Mr. G’s account. He never placed the travel alert because he thought I was exaggerating about the need for it. Of course the man can’t figure out how to make a phone call to the number on the back of his card to straighten it out, but that’s another story.

    P.S. our threshold for not talking about it is $100. But we are so open it’s ridiculous. Like if I’m buying a Christmas gift basket for Mr. Groovy’s 94 year old great aunt, I’ll ask him if he’s comfortable with what I’m spending. And he doesn’t even buy a book on Amazon without mentioning it.
    Mrs. Groovy recently posted…Tito, Three Horsemen, and Talking Trash

    • Haha I’m almost afraid to read this out loud! Did you send Mr. Groovy here?? It’s funny that Jared doesn’t mind sharing about small purchases sometimes but when he does, it’s something over $1000+ kind of news that just makes you wonder…geez…what’s going in your head?

  • Oof. I’m #teamlily 100% on this one. I can’t imagine this sort of thing EVER happening in our household. We do keep separate sums of money for personal expenses, but I can’t think of a single example of more than a couple hundred dollars where it wasn’t discussed beforehand even if it was from our personal accounts. Good for the two of you for fully hashing it out instead of letting it just continue to simmer.
    Angela @ Tread Lightly Retire Early recently posted…Friday’s Frugal Five (2018 Week 10)

  • I’m not a male feminist. In fact, I despise male feminists (such virtue signaling is so unseemly). But Jared is dead wrong in these matters. He’s got to realize that this is your marriage too, and all decisions for Team Frugal Gene have to be made by the two captains of Team Frugal Gene. Jared, I love ya, man. But you got to get your mind right. Financial infidelity ain’t cool.
    Mr. Groovy recently posted…Tito, Three Horsemen, and Talking Trash

  • Communication is huge in a relationship, and I agree that if you expressed specifically that you wanted to know about large sums of money moving around then he should respect that and communicate with you.

    On a similar note though, I am a competitive person and keeping track of “winning” or “losing” arguments would really put me off of wanting to have the discussion in the first place. My husband and I discuss everything but we try to keep it on a “same team” basis with no winners or losers. Just throwing it out there : )

  • I’ve only just come across this post. I don’t think there is a ‘Team Lily’ or a ‘Team Jared’. You are husband and wife; there is only one team.

    I think you’ve done the right thing, you’ve communicated, said what you each think / feel about the movement of the funds and have come to an agreement on how you’ll handle things in future. As you whether you should be more angry, anger simply begets anger. Empathy and communication are far better building blocks for your relationship over the long term.

    One other point is that maybe you should both have a chat about your emergency fund. Given your multiple income streams maybe you don’t need to keep such a large amount set aside and you could be making investment returns on part of it instead.

    As always, thanks for posting.

    HH

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