Her Money Not Ours

[disneysteve]

Maat, in debt there isn't necessarily one person who "gets" into debt.

The partner has to go along with it. I see a lot of people try and blame on the person spending. But they never say anything. They never discuss family finances and lay it on the line.

I happened to be flipping channels the other nite and came across Dr. Phil. A husband and wife were on and were talking about financial trouble and their home being foreclosed. I stopped to watch, being a finance junkie. Turns out, the wife managed the finances for the couple and had "secretly" gotten into trouble. She confessed to her husband on the show that she had spent all of their money on gambling and her prescription drug addiction.

Now maybe I'm wrong, but how could I not notice if my wife had a drug addiction and gambling problem so severe that she spent enough on it that we lost our house? That doesn't happen overnight.

[maat55]

Call me nuts in this group, but, if I won a million dollars, I would gladly give my wife half. I would expect her to do the same. Nest eggs are ours not ones, IMO. Same goes for debts.

[moneybags]

One other note that I haven't seen come up quite yet.... I don't know how this works, but remember that you'll have to pay inheritance taxes on what your wife has recieved. Just make sure to take that into account.

There may or may not be taxes due. It depends on if the money has ever been taxed before. For example, money in a 401K or traditional IRA has never been taxed by the IRS. If you inherit money in this form, you owe the taxes. Money held in a savings account has already been taxed to the original owner, so no tax is due to the inheritor.

[kork13]

There may or may not be taxes due. It depends on if the money has ever been taxed before. For example, money in a 401K or traditional IRA has never been taxed by the IRS. If you inherit money in this form, you owe the taxes. Money held in a savings account has already been taxed to the original owner, so no tax is due to the inheritor.

really............ cool, i thought no matter what you'll owe taxes on inheritances.... sick deal.

So glad there are people here who can correct us when we're being stupid.

[scfr]

maat55 - Let me ask you this (with apologies to OP because your thread has gotten rather off-track): Suppose you live to a ripe old age, which hopefully you will. You leave a substantial amount of money to your granddaughter. Your granddaughter places the money in a joint account with her husband. Soon thereafter, the husband divorces your granddaughter and runs off with a drug-addicted hooker, taking half of what used to be your money with him (it's now his legally, after all). How would you feel?

I realize this is an extreme example, but I pose this question in a "let's look at the big picture" way.

Also, I remember you saying something about doing a Letter of Instructions for your wife, with some suggestions about what she might want to do with assets if she were to remarry. Wouldn't you want her to protect those assets for the eventual benefit of your children? What if she placed the assets in joint ownership with her second husband, who then divorced her and took half of everything? That would stink, right?

I just don't think we know enough about the entire situation to say with certainty that the wife is in the wrong.

I do not think an inheritance is the same thing as winning the lottery. If I won the lottery, half would go to my husband, and not only because we live in a community property state, but because I would think it's the right thing to do. With an inheritance, I think the wishes of the person leaving the money ought to at least be considered.

[maat55]

maat55 - Let me ask you this (with apologies to OP because your thread has gotten rather off-track): Suppose you live to a ripe old age, which hopefully you will. You leave a substantial amount of money to your granddaughter. Your granddaughter places the money in a joint account with her husband. Soon thereafter, the husband divorces your granddaughter and runs off with a drug-addicted hooker, taking half of what used to be your money with him (it's now his legally, after all). How would you feel?

Your example has merit and I questioned this possibility in my second post. I also questioned whether the money is just a trust for the benefit of the grandma. I'm basing my oppinion on the info provided.

Also, I remember you saying something about doing a Letter of Instructions for your wife, with some suggestions about what she might want to do with assets if she were to remarry. Wouldn't you want her to protect those assets for the eventual benefit of your children? What if she placed the assets in joint ownership with her second husband, who then divorced her and took half of everything? That would stink, right?

Based on the info provided, this is a 16 year marriage, of which she has equal responsibility to the debt. I do agree that Grandpa's wishes should be honored.

I just don't think we know enough about the entire situation to say with certainty that the wife is in the wrong.

Yes, we need more info to make a full decission. Mine again, is based on info provided.

I do not think an inheritance is the same thing as winning the lottery. If I won the lottery, half would go to my husband, and not only because we live in a community property state, but because I would think it's the right thing to do. With an inheritance, I think the wishes of the person leaving the money ought to at least be considered.

I'm not going to agree or dissagree with you on this. If the money had no exemptions by the grandfather, I would say it is hers/theirs to use for their benefit.

We don't know if OP is being forthcoming with us, we can only give our oppinion based on the information we have and offer suggestions for possible senarios not presented. I've stated many times that there are exemptions to my oppinion.(Drugs, gambling, wife is only trustee for grandma)

[Seeker]

http://finance.yahoo.com/family-home/article/105742/The-Key-to-Wedded-Bliss?-Money-Matters

... a client who complained that his wife spent a thousand dollars a month on her wardrobe....(mediator) contacted the wife, who said her husband spent just as much on dinner with his buddies. So the husband asked (mediator) to show how much they would save if they invested the $12,000 she spent each year. (Mediator) — careful to title the report "Clothing, Dinner or Invested?" — ran an analysis and found that the couple would have $1.6 million after 28 years, assuming a 9 percent rate of return. "They are going to try and compromise," he said.

The law essentially defines the money as hers. But if I were the "he" in this situation and the spending-paycheck-to-paycheck is because of choices made by "her" then I'd be pretty angry too.

On the other hand, if the paycheck-to-paycheck condition were "their" problem, I'd advise her to keep the money separate. Part of the reason is because she may not feel that she has much say in financial matters because she's a SAHM and he's the income earner. So in the "their" situation, she may be a passive party.

If the current financial condition were due to his "x", then I'd recommend that the $'s stay in her name.

LAL is correct. Almost always in marriage "$'s are collaborated" but there's that "almost always" quantifier. Some people are financially passive and some are financially agressive.

My Mom was a SAHM pretty much all her married life (financially passive); when Dad retired, and she hit retirement age too, she got a portion of Social Security (a much much smaller amount than he). She kept it separate... and sill does to this day. My Dad does not understand why; but it represents her share... something she gets to decide how to spend without answering to him or asking and explaining what she needs money for. They've never had a CC or expenses outside of the mortgage and his auto. Growing up, there sometimes was money and sometimes not; mostly not.

100k is a very good chunk of $'s.... but we don't know the situation. And everyone's needs are different.

I agree that finance and marriage should be a collaboration.... but I've seen many many instances where it is not. The problem arises when one of the two feels taken advantage of (unfair).... and that's where the converstation needs to head toward.

[m3racer]

Is divorce a possible option? Personally, I would freak out if I was in your shoes. This sounds like a classic case of, "What's mine is mine and what's your's is mine." Total BS IMO.

[Broken Arrow]

Woah. Woah. Maybe you didn't mean that literally, but divorce should never be an option. Only thing I believe in is to be prepared if such a storm is brewing in the horizon.

Nobody should willingly choose their own personal Hurricane Katrina. However, if we may be in such a danger, we should only what we can to minimize the damage.

[DebbieL]

Divorce would be an option to me if I had supported someone for 16 years, let her grandparents live in my home, she inherited $100K from Grandpa and refused to put it in the communal pot. That would definitely make me blow my stack. She also proceeded to max out 3 credit cards after getting this inheritance (from the way I read the original post). She sounds very spoiled, selfish and greedy to me (and yes, I realize we have only heard one side, etc, etc, etc). Not qualities I look for in a mate.

[tripods68]

Maybe she plans to live him one day which would explain why she is keeping the money for herself. I can't think of any reason why wouldn't share her money towards paying the bills. I apologize in advance if I offend you in some way for even mentioning this. For the record, I just don't say this very "loosely" without merit. I'd know friends that did this in the past.

[cschin4]

Wow! I only read the first post so I am responding to that. You have been married for 16 years and yet your wife still feels like "mine/yours"? That is a bit surprising and perhaps money is not the real issue but it sounds like there is a lack of unity in your marriage. I think you could both agree if you discuss it to apply some money toward the bills and then perhaps bank the rest for your retirement/future and put it into an untouchable account such as long term CD, etc.
Then, I do think you should perhaps get some marriage counseling and work on your marriage and improving that. Her having CC's unbeknownst to you is not a good thing either.

[GoodBuyGirl]

With you being the sole bread winner for the past 16 years did you include her in all financial matters?
I am a SAHM and my DH will tell me were sitting pretty financially but as soon as I bring in any type of money all of a sudden he changes his tune and says we are struggling.
So of course the money ends up going towards bills. So I get resentful because things are always great until I get money then the bottom falls out. So my ideas of putting the money in savings or bettering our quality of life are dashed.
I would be ok with it all going towards bills if my husband was honest in the 1st place rather than candy coating the situation by saying everything is fine then waiting until some money crosses my hands and say were in the hole.
I don't know your whole situation but if you have not sat down with your wife and told her of your financial crisis before she got the money I can see how she would be resentful of you bringing up debt as soon as she has some money in her hands.
On the other hand if she was already aware of your money problems I would think she would want to do her part in helping pay down the debt.
I can also see your point that the burden of debt has been on your shoulders for 16 years and you feel she should take some of the weight off your shoulders now that she has the means to do so. For the sake of your marriage I would think that she would want to so long as you told her of the debt before she got the money. Otherwise if she has had no say in the last 16 years you really have no right to include her now.

[moneybags]

With you being the sole bread winner for the past 16 years did you include her in all financial matters?
I am a SAHM and my DH will tell me were sitting pretty financially but as soon as I bring in any type of money all of a sudden he changes his tune and says we are struggling.

On a side note, each partner should always have a clear picture of their financial situation.

[Well Spent]

Tbone,
based on what you've told us, she should be using the windfall to support your family.

Why after 16 years of marriage does she think you're out to get her family's money?

Why have you been the sole breadwinner for 16 years? It's uncommon for a family to require a stay at home parent for that long. It seems she should have joined the paid workforce years ago.

Why is she sabotaging your's family future by not working, maxing out credit cards, and hiding $100,000 that should be used to secure her family's finances?

It seems to me that she doesn't want to be in this marriage anymore. You have a lot of talking to do with her and a lot of soulsearching to do with yourself. Are you better off with her or without her?

Counseling alone or with her would be beneficial. Good luck.