I am a retired 62-year-old girl. I was widowed in 2006 on the age of 46 and raised my two youngsters (now 24 and 27) on my personal. I used my husband’s life insurance coverage cash (about $500,000) to keep our home, present youngster care, and get each youngsters by way of faculty with out scholar loans.
I did some investing as nicely. I saved by way of my 401(okay) at work, maxing out yearly. Now retired due to some well being points, I have a small pension (about $24,000 a 12 months), an funding account valued at $2.5 million (from which I’m drawing about 2% a 12 months for living bills), a home valued at about $400,000 and no debt.
I remarried 6 years in the past. My husband is a fantastic man with many nice qualities, although he’s not been nice at managing cash. He was divorced — his spouse left him and their 3 youngsters, and he raised them alone. (They’re all grown, ages 29 to 35.) He is 65, now retired, was an engineer and had a well-paying job.
I absolutely acknowledge that his monetary place was completely different from mine — he by no means obtained any youngster help from his ex, and, in reality, had to pay her spousal help for 4 years, whereas I had Social Security and insurance coverage to assist my funds. He saved some when he labored, however for a few years didn’t make investments in his 401(okay). He has a pension that is about 2.5 occasions the scale of mine, and he is beginning to acquire Social Security subsequent month. He additionally has about $500,000 in retirement financial savings.
“‘My home is in trust for my children and the prenup gives him a life interest in the house, should I pre-decease him.’”
When I married my husband, he bought his house, which was valued at $100,000 greater than mine, however he had no fairness in it (due to borrowing in opposition to it for home upkeep, vehicles and faculty tuition). He had to take cash to closing, repaying the financial institution for the rest of the mortgage.
I lent him that cash and loaned him $20,000 for portray, mildew remediation and flooring restore that wanted to be accomplished earlier than he moved in. His first and second mortgage and living bills ate up his whole revenue, and he was living on credit score. He owed about $50,000 on bank cards and $40,000 for his third youngster’s faculty prices (she had a mortgage as nicely).
After we bought his house and we married, he paid off every thing. He paid me again every thing he had borrowed, paid off his bank cards and paid down the coed mortgage (which he lastly absolutely paid off this 12 months).
We signed a prenup earlier than we married. My home is in belief for my youngsters and the prenup offers him a life curiosity in the house, ought to I pre-decease him. We split living bills. During the primary 4 years of our marriage, that split included cash for the mortgage (we paid about $550 a month every). The prenup states that if I promote the house, I would owe him the $550 for every month that he paid half the mortgage; that’s about $25,000 complete. I’m effective with all that.
“‘He is very handy and does a lot of small repairs and maintenance himself, which I greatly appreciate.’”
We’re nonetheless splitting bills, however we not pay $550 per thirty days because the mortgage is paid off. However, we’ve been doing a lot of enhancements to the house. Some are enhancements we each wished (e.g., changing the worn, warped deck with a new bluestone patio) and others have been requirements (e.g., eradicating the den ceiling due to leaking ductwork and repairing the ducts, changing the ceiling and flooring).
I’m spending a fortune on home upkeep. I realize that my second husband is essentially living in my house for free. He is very helpful and does a lot of small repairs and upkeep himself, which I tremendously admire.
Any repairs and enhancements profit me greater than they do him, as I will realize the elevated worth in my home when I promote it. But I am rising resentful that I am masking so many giant bills and am questioning if there is a fair way for him to pay a few of these prices.
I additionally realize that my internet price is larger than his. What is fair? Should he pay hire or another prices related to the upkeep? Or ought to I suck it up and pay for something house-related and simply admire the upkeep work he does for me?
What is your recommendation for an equitable association?
Thanks a lot.
Second Wife in Virginia
Dear Second Wife,
Before I reply your query, I need to congratulate you for getting this far. First as a spouse, widow and single mom and once more as a second spouse, navigating and — for probably the most half — avoiding these treacherous monetary pitfalls that tens of millions of individuals fall prey to day-after-day.
You are additionally a fantastic instance of taking part in the lengthy sport. You invested, paid off your mortgage, put your youngsters by way of faculty and have a sizable nest egg to assist compensate for your extra modest pension. You not solely survived, however you thrived. You led a good and, it appears, blissful life.
This column is about cash, primarily, for those who take the title actually, however for those who don’t have peace of thoughts and take a second probability at happiness with a new relationship — as you probably did together with your second husband — what’s all of it for, anyhow? Money alone received’t make anybody content material.
Not solely did you keep in the black, however you helped your second husband get out of debt, you supplied him with a secure home life, and also you protected your self with a fairly sensible prenuptial settlement that additionally generously agrees to repay him for contributions he made to your mortgage for those who promote. Brava!
From the romantic to the semantic
And now I would really like to transfer from the romantic to the semantic. Apologies in advance. You write that you simply really feel resentful as a result of your husband doesn’t pay for any of the renovations, which I think about are including up in the hundreds of {dollars}, but he’ll profit from them for his lifetime.
You say you might be resentful since you are paying for the renovations — not as a result of he has refused to pay. You are essentially and objectively irritated with your self, fairly than blaming your husband. (He might have volunteered to pay half. Rightly or wrongly, he believes his monetary obligations to your house are full.)
Your resolution is barely much less simple, so it’s going to assist to be trustworthy with him. Tell him that you simply didn’t anticipate the renovations to price a lot, and begin by asking him what he believes could be a fair contribution. You might replace your prenup to agree to reimburse capital enhancements must you promote or split.
Take into consideration that you simply embarked on these renovations with out the understanding or intention that he would pay for them too. Perhaps it’s fair to pay 50% of the newest important renovations, however lower than 50% for the costlier bluestone patio.
An Eleventh-hour shock
However, he might nicely agree to pay 50% of all of them. It’s simply tougher to ask him to pay you for 50% retroactively, particularly in case you are going again a number of years. He has a mounted revenue too, however no one likes to be shocked with a invoice on the Eleventh hour, and at such a late stage after the unique expenditure.
For that motive, I would additionally advise in opposition to asking him to pay hire. That appears an excessive amount of like a rug pull and — greater than that — a covert way of masking the bills that you simply didn’t ask him or anticipate him to pay in the primary occasion. You are each retired now, in any case.
It doesn’t have to be 50/50. It’s your house. You each benefit from living there for your lifetime, assuming you stay married, and it’ll in the end go to your youngsters. He is investing in your home as a place to reside, however not as an asset that he can cross down to his personal youngsters.
You have navigated your monetary and marital negotiations with consideration, openness and respect. There’s no motive why this ought to be any completely different. It will probably be simpler for him to acquiesce for those who don’t come to him with an ironclad, rigid proposal that is a fait accompli.
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