Trying to teach my fiancé about money and financials

[Hikergirl]

I mean I'm not going to break up with him just because we can't agree on this right now... We've been through worse together and as a couple we need to learn how to work through money issues like this. It's life and how being a couple works. We have a dog together too and I have to say since we met in high school, he has gotten 1,000% better with his impulsive irresponsibility. Face it, we're both young. It's kind of inevitable in some aspects to still be a little irresponsible at our age, but it is also obvious that I am the more responsible of us. Also, we're not getting married until we can move out together which will still be a while. I guess I just don't know how to break through when it feels like me and his parents are constantly pulling him in opposite directions...

Some aspects yes, but if you are at a point where you are engaged then being immature about finances should not be one of those aspects. It sounds like you are definitely more responsible than your fiance in that, and you may always be. He needs a wake up call about what living in the real world costs. I don't think you can teach him anything, he needs to learn for himself and that means moving out of mom and dad's house.

 

[Jen and Ashwin]

So I read all of the comments and I have to say that there are some pretty extreme ones. The OP was asking for advice on how to teach her fiance about finances. I totally believe that financial responsibility is a skill that can be developed and that people can change their relationship with money through learning and practice.

When I got married, my husband had never lived on his own before and so he did not have the same set of financial skills that I had developed over many years of living on my own. He wasn't really irresponsible with money, but he had never had the experience of truly budgeting out all of his real expenses and thinking more long term. It was a hard adjustment for both of us at first. Husband would whine that I never let us do anything fun and think of me as the bad guy. I would tell him that was just didn't have enough money to do X, Y and Z and then feel guilty. Eventually, I told him that he needed to get more involved with the finances because I felt like I was doing all of the heavy lifting and it was stressing me out a ton.

I think one of the best tools for teaching about finances is to set up a budget. DH and I started using a program called You Need a Budget (ynab.com). It has completely changed our relationship (not just financial relationship, but even in other areas too). DH now can see exactly how much money we have and where that money goes. We sit down and make financial decisions together, prioritizing our money based on our short and long term goals. We have a budget meeting every week (we just did that this morning) where we make sure that we are on track and discuss any changes we need to make as the month goes on. It has decreased my stress levels and made him much more understanding about the financial limits that exist for us.

So over the past year, we have paid off all of DHs student loans, saved for IVF costs, paid off all of our credit card debt and started making extra payments towards our mortgage and car loans. We agreed to each of these expenses together, which made each of us feel invested in these goals. And we now have more money to put towards those fun things that DH wants to do, which has made him happier and me feel less like the bad guy.

Now you aren't married yet, but that doesn't mean that you shouldn't be discussing short term finances or long term goals together. I would not combine any of your finances at this point, in case things don't work out long term. But you need to understand what you both want out of life and if those visions are compatible. So talk about those things together. If you need a struture for that, consider getting a book like
Smart Couples Finish Rich: 9 Steps to Creating a Rich Future for You and Your Partner and working through it together. Or consider pre-marital counseling. I would also consider getting YNAB or another good budget program (Mint sucks, in my opinion, but there are probably other good programs out there to consider). In YNAB, you can each set up a separate budget within the program that allows you to track your income, debt and expenses. Just seeing your financial picture all laid out makes a big impact, I think and may help to change your fiance's understanding about just how much he can afford to spend on a car.

And you can discuss ways to make his car purchase more reasonable. Maybe he can buy the same truck, just a few years old rather than new. Maybe he can sell his motorcycle to make the car purchase more affordable. Maybe he can cut other expenses somewhere else, etc. But he also needs to understand that most car loans last 4-6 years, so if he ever hopes to move out of his parents house, he can't be spending all of his money towards an auto loan. Honestly, DH and I make a really good salary and I would never consider paying $40k for a car. DH got a car last April and it was $24k out the door. That payment is $450 per month. So I can understand your concerns.

Now is the time to try and work with your fiance on his financial skills. If he is able to make smarter financial decisions and work with you towards a future you both want, then you will have a much stronger marriage some day. If he doesn't seem willing to make changes, then you should seriously consider what that might mean for your relationship over the long term. Best of luck to you both.

 

[kymom99]

He needs to live on his own for a while, for the financial experience. Note that when I say "alone", I don't necessarily mean completely by himself--roommates would be fine. In fact, they would help keep his costs down. But, he needs to live away from Mom and Dad, and not really with thyou. He needs to start acting like an adult, financially.

My husband never lived alone. And he should have. All the financial burden has been mine for 21 years. I know it's my fault but if OP can learn from me, then that would be great. The best way for him to learn is to do it on his own, by himself.

 

[ceecee]

Do not get married (or live together) until you both agree on finances! Unless he is making big bucks he shouldn't be buying a $40k truck even then what a waste of $ when you don't yet own a home (nice down payment). I wouldn't even spend $40 on any car and we have no debt. He really does need to live on his own and see what paying bills feels like. Living at home is a great way to save for your future but it doesn't seem like you are on the same page (or even in the same book!) I was engaged to a guy living with his parents with a large truck payment (the best truck was a very important thing to him) he had no sense of money what so ever and neither did his parents, it was a constant argument in their home...thankfully after living on my own for 7 years I met someone with "like" money sense, so we have never had issues with a budget, etc. During pre-marital classes at our church money issues were a top reason for divorce (that was almost 30 years ago, it may not be the case now). Get some Dave Ramsey books and try and get him involved now not later.

 

[tcufrog]

My husband made a lot more than me but he was much more irresponsible with money than I was. Luckily he realized that he was overspending before we moved in together when we were around your age. We committed to righting the ship and made a huge amount of progress before we got married. The key though is that we were equally committed to solving the problem.

If you move forward with him and you are not on the same page regarding such an important issue you risk two outcomes that are detrimental to a marriage:

1. You keep pushing and become resentful and he thinks you're a nag.

2. You give up and y'all have trouble getting on firm financial footing.

I highly recommend you dial back on the relationship until y'all have worked through this in a way that makes both of you comfortable.

It takes much more than love to make a marriage work. I hate to sound patronizing but you think y'all have been through hard stuff together. It only gets more complicated and harder. Look at this as a major relationship test because it is.

 

[runwad]

Yep I second everything tcufrog said!! Does he have student loans and I missed that??? I say keep doing what you're doing, paying down your loans and moving forward to having financial freedom in your life!!

When DH and I got married I was like you, always looking for a secure future, made sure I didn't bring any debt into the marriage. I was very resentful of DH not having his student loan paid off ($2500 back in the day,ha!) nor his car. It made for a rocky start. Luckily DH always went along with me handling the finances because he had no clue. He never even had a checking account, he'd give his money to his mom and she'd pay his bills.

Anywho, 25 years later and we are FINALLY on the same page! It was a lot of hard work to get here and neither one of us ever gave up, but money was always the bone of contention between us.

I'd keep doing what you are doing getting your financial house in order and try to get him to look at making other choices but honestly it won't be anything that will happen overnight. I think time and maturity are the two things that really help.

 

[tvguy]

I was raised that you have to decide if something is a need, a want, or or "would be nice"
My wife was raised differently. But it didn't take too long after we started dating that she learned first hand that skipping many of the "would be nice" things, meant there was money in the bank for needs, and many times for wants.

 

[kymom99]

I will say I have a friend whose family didn't teach much fiscal responsibility. I think her parents tried to show their love with money. She married a man who was very money conscious. She found out very quickly that his way brought security and not the chaos that her younger years brought. Hopefully this can happen for OP

 

[DLgal]

Frankly, both of you have an unhealthy relationship with money. Ideally, you will each compromise and meet in the middle. Living with your parents is a crutch. Get out of there! You are not living as an independent adult. You have a very unrealistic idea of financial obligations. You need to get used to supporting yourself 100% and learning how to manage a household budget. Both of you. I would actually suggest finding separate apartments if you don't want to live together before marriage. Do the roommate thing with friends or strangers and figure out how to be financially smart (which does not necessarily translate to paying off ALL your student loans immediately, or buying a $40k truck). Dear God...a $40k truck at age 23? That is over indulgent unless your fiance is raking in a six figure income on his own. We make well north of $100k and would not dream of spending $40k on a car.

You can't always have what you want. You need to learn that debt is OK and manageable. Don't be so scared of it. Your fiance needs to learn the concept of "can I afford that." You both could use some financial counseling.

And, I tend to agree that these vastly different attitudes towards money may be a bad omen for a marriage.

 

[tzolkin]

While the spending habits and lack of financial knowledge are major issues, I think the fact that he values/listens to his parents' opinions more than yours may wind up being the biggest hurdle in your relationship. So that needs to be addressed.

My sister is in a similar situation-- she is very frugal, never had debt, etc but her husband's family really just does not understand even the basics of finance. He always just wants to go along with whatever his parents suggest rather than making his own rational decision about what is best for his family. (This has become a huge marital problem for them because it's not limited to money, but extends to his parents having influence over every single aspect of their married life including where they live, their children's healthcare, etc)

This is going to sound completely harsh, but you need to have a discussion with your fiancé that is very rational but also express your feelings. He absolutely does not "need" a $40k vehicle. No one does. If he has to live with his parents to be able to save enough money to get married and buy a home (and he still has debt), there is no way he can possibly afford it. If my fiancé could not see that he was choosing a truck at the expense of our future, I would not be willing to deal with the lifetime of similar decisions that is sure to follow.

 

[Jen and Ashwin]

This is going to sound completely harsh, but you need to have a discussion with your fiancé that is very rational but also express your feelings. He absolutely does not "need" a $40k vehicle. No one does. If he has to live with his parents to be able to save enough money to get married and buy a home (and he still has debt), there is no way he can possibly afford it. If my fiancé could not see that he was choosing a truck at the expense of our future, I would not be willing to deal with the lifetime of similar decisions that is sure to follow.

This made me think about an ex-boyfriend that I had. We dated for over 6 years, from junior year of high school through college. My ex got a job and his job came with a $5k sign up bonus. I thought for sure that he would use the money on an engagement ring, because if I was him, that would have been my first thought. Well, instead he bought an ugly orange sofa and a terrible rear projection TV (this was terrible, old technology even then). It showed me very strongly that I was not really part of his priorities nor was our future together. The relationship ended pretty soon afterwards and I am so glad now that I dodged that bullet. Our values were completely different, but I was blinded to it until that moment.

 

[katmatry]

Do not get married until you are on the same page with how to handle your finances.

 

[1st*toright]

I second using YNAB - it is an amazing tool for seeing how much money you have available and deciding how to prioritize spending. You could set it up to include both of your finances without actually co-mingling money, to get a picture of your joint finances - or you could set up separate accounts for each of you. You could set up line items for rent/utilities etc. that you aren't actually paying today and put the money into savings (or debt service) to see what the impact of having those expenses will be on your overall budget when you eventually move out. You could add a category for $$ towards the truck he wants - when he sees the impact of that payment (you could put money into savings equal to what the payment would be) it might help him prioritize. YNAB shows you that there won't magically be more money to go around in future - it is all about using what you have available right now according to your priorities. It also does a really good job of showing the impact of credit card spending.

This might be a way to try to work on finances together without jumping in with both feet and actually co-mingling your funds. Whether you do this before or after you are move in together or get married, the sooner you can both find even footing regarding money, the better shot you have at keeping it from coming between you.

Good luck!

 

[crisi]

Thank you for this! You wrote that very well and it helped a lot!
Honestly the biggest thing holding us back from moving out is the fact that I'm crazy and feel like I need to pay my loans off to feel secure. I've been trying to pay at least one of them off so that I only have one left over. And also the fact that he really does need a car. Technically we probably could rent a place, but it would mean that I would be paying the minimum on my loans and basically not putting anything into savings each month.

But with this whole problem, it is definitely seeming like it would be worth it!!!

So this is where I see the problem is.

I need financial security in my life. Its a huge need for me - and I'm an emotional wreck without it. If you are like me, and you marry someone who spends without thinking, this WILL send your marriage into the toilet.

I don't let my husband spend $40k on a car, and we make well into six figures a year between us, with almost no debt (a $300 a month mortgage - with the principal invested in the market) and college paid for. My own car wasn't $15k.

I would sit him down and talk about your long term goals in life - do you want kids (EXPENSIVE!), a house, vacations? Do you want to have to work until you are 68, or would you like to be able to ease back (I'm 50 and semi-retired). Get him to understand that money spent today isn't available tomorrow when the kids need $2000 for a band trip - and that a $300 a month car payment is a lot to be looking at when you are trying to afford diapers. Or $20,000 for college. I used to explain cars in terms of years of college for our kids...That's a two years worth of college car.....Kids are a big thing - if he takes out a $40k truck loan at your ages, your chances of him still having that loan when you have kids is pretty high - or having to delay kids because you can't afford them - and delaying kids because your husband hasn't grown up is another thing I've seen take a toll on a marriage.

Talk about financial security - I'm a worrier - will I have money if the house needs a new furnace? If the dog needs surgery? If my husband is out of work for six months? Life will throw you those curveballs - and if you are in the hole to start with, they won't be easy to manage. You know that because you have savings. Early in our marriage we had fertility treatments followed by an adoption - my son is 18, so it was long ago - but that little excursion set us back $30k way back then.

I've watched a lot of marriages end due to money - it was a factor in my first marriage. And it took me five years to dig out of the hole he created. If you are anxious now about the debt you have, imagine that he walks out in five years, leaving you paying down his debt for another five or ten years.

He CAN change - my husband was paying down a bankruptcy when we moved in together. But he had already started to change - the bankruptcy taught him a few things - and we had the good fortune to end up making a lot of money so he hasn't felt cheated by a budget that includes college savings. And while his mom isn't someone with a ton of financial sense - she raised him without a lot of money - he wasn't used to cars being bought new, or clothes bought for full price from the stores in the mall - so he started out fairly frugal.

My brother in law married a woman with no financial sense and it didn't work out well. He ended up with a bankruptcy, his house was nearly foreclosed on (we bailed him out), and he left the marriage after five years with $70k in his half of their debt. Now, like my husband, he wasn't raised with a lot of financial knowledge, so he didn't have the tool set ready to teach her - but she was also resistant to change.

The truck should be a good indication on how willing he is to change - if he buys something used - as you said he needs a car - for a reasonable amount of money, he's listening to you. If he sells the bike to help pay for it, that's even better (a motorcycle on a loan makes me cringe to start with). If he listens to your concerns and buys a $40k truck, I'll lay odds on divorce within three years if you marry him.

 

[crisi]

Oh, I want to address the "we're young" thing from the prospective of 50 and having watched a lot of my friends grow up.

From 50, the people who started "adulting" earlier, who didn't make excuses like "we are young," who understood that time was passing - they are the people who are in good positions for retirement. Their kids are older and heading to college - even though almost none of us had our kids young or even married that young. Their houses are nearly paid off - or will be when they want to retire. Their 401ks will provide a livable income.

The ones who put off adulting because they had plenty of time are much messier now that they are older. They delayed kids because they had time and were not ready - so I know people who are 60 with middle schoolers, and people who are 50 with elementary schoolers. They bought homes late, and are looking at mortgages they won't be able to afford on social security. They didn't start their 401ks until late and so won't have much income beyond social security.

You think 23 and 24 isn't that old, but age is going to sneak up on you very fast. A five year car loan at 24 is being paid off at 29. A 30 year mortgage at 30 is paid off when you are 60. I'm not saying "have those kids today, buy a house today" - you ARE still young - but I am saying that a change in mindset from "we have plenty of time" to "understand what goals we have and how that relates to the time we have" can make a drastic difference.

And for people of my generation, it was easier than it is for people of yours. We got the boom economy of the 90s. Our student loan burdens were more manageable.

 

[elaine amj]

Frankly, both of you have an unhealthy relationship with money. Ideally, you will each compromise and meet in the middle. Living with your parents is a crutch. Get out of there! You are not living as an independent adult. You have a very unrealistic idea of financial obligations. You need to get used to supporting yourself 100% and learning how to manage a household budget. Both of you.

And, I tend to agree that these vastly different attitudes towards money may be a bad omen for a marriage.

You know - this is a very North American way of thinking. I did live on my own for 2 years through necessity. That said, my DH never lived on his own and was cosseted by his mother and grandmother (his grandma still made his breakfast every morning when he was 30!). I don't think he paid a regular household bill or had to enter a grocery store until we got married. Honestly, he is one of the most responsible people I know. He does 90% of our grocery shopping (and for way less money than I can!). He keeps our household running smoothly in a way I never could. And while I handle the budget, he handles all the daily bill paying, etc and is extremely responsible and conscientious with his finances.

IMO, it's dependent on a person's attitude towards money. Both DH and I are frugal optimizers who like to get the most bang for our buck. Neither of us have ever been into frivolous spending and believe that every penny saved is a penny earned. Most importantly, we don't spend because we "deserve it". We spend on things that are of value to us (like Disney trips!).

I like the suggestion of using something like YNAB. That's what we use. Developing a budget so he can clearly see how he can work towards his (and your joint) goals will likely be very helpful. I like how YNAB sets things up - it does kind of "force" you to think within the frameworks of their philosophy and was carefully designed to guide behavior. Thinking in the long term vs in the short term will be very helpful as you prepare towards marriage.

And I totally agree with DLgal (and the chorus of other DIS'ers here), developing similar attitudes towards money TOGETHER will be very helpful in a good marriage. Money can be a huge challenge. That said, I've seen couples with very different money attitudes develop similar goals and since both are willing to work towards them, they are able to channel each of their strengths to work together. Ultimately, a strong marriage involves having common end goals and both be willing to support each other to work towards them.

So say he wants his dream car and you both want a house. You decide together which one is the priority. Maybe it IS the car (I believe in spending on what you value). I just think the mature approach is to understand what you are giving up to get that car. Perhaps he has to work a 2nd job or you both have to live with your parents for an extra year and delay the wedding a little.

Like your fiance's parents, we take a lot of vacations. It does mean we have less money to fix up the house. My basement needs to be redecorated, I need to replace a hall cabinet door, my couch is worn out, etc etc. But since we've chosen to spend our money on trips, we don't have room in the budget to do it (Notice I didn't say we don't have the money - we have money...its just earmarked for other things). The difference is that we made a conscious choice. And while I would like a prettier house, I like my vacations more so we continue to be happy with our decisions.

 

[SharonZ]

My comment is that he has to want to change his financial habits, it can't just be you asking him to make better choices. If that's not something his willing to do, then you are better off knowing that in advance.

 

[katie111]

This might seem harsh but maybe he really doesn't want to get married any time soon, or perhaps at all. It seems like a new car is his priority, not the wedding, not getting an apartment or house with you, but a nice car. If he gets this car, how far out is that going to delay your plans to get married & to move in together? Do you even have a wedding day set yet? Who is paying for the wedding & the honeymoon? Does he realize that if you get a place, you will have to buy furniture, pay first & last month's rent or a down payment, pay utilities, etc? Maybe his parents know that he is not ready, so they are pushing the new car idea.

Also, I agree with the previous poster that if he is listening to his parents more than he is listening to you, that is certainly a red flag. I think you need to have a long talk with him, or a lot of long talks, and figure out what your long terms plans together really are. You sound like you are very mature, and he sounds like he still wants to be a free 23 year old who can do whatever he wants. Until you get on the same page I don't think you can move forward with anything. Also, just curious, but did either or both of you live away at college? Do you make similar salaries?

 

[dosekies]

I'm really appreciating everyone's insight here! Granted I was a little heated when I posted this, it is something that we definitely need to work through. We both have our faults and we need to find some middle ground.

This might seem harsh but maybe he really doesn't want to get married any time soon, or perhaps at all. It seems like a new car is his priority, not the wedding, not getting an apartment or house with you, but a nice car. If he gets this car, how far out is that going to delay your plans to get married & to move in together? Do you even have a wedding day set yet? Who is paying for the wedding & the honeymoon? Does he realize that if you get a place, you will have to buy furniture, pay first & last month's rent or a down payment, pay utilities, etc? Maybe his parents know that he is not ready, so they are pushing the new car idea.

Also, I agree with the previous poster that if he is listening to his parents more than he is listening to you, that is certainly a red flag. I think you need to have a long talk with him, or a lot of long talks, and figure out what your long terms plans together really are. You sound like you are very mature, and he sounds like he still wants to be a free 23 year old who can do whatever he wants. Until you get on the same page I don't think you can move forward with anything. Also, just curious, but did either or both of you live away at college? Do you make similar salaries?

To answer your last questions, I went to college about 2.5 hours from home so I did live away. He did not attend college. He started working full time right away and has lived at home forever. And we currently make very similar salaries, but his is gauranteed to be higher than mine by next year, albeit not by too much.

 

[Dakota731]

Try one of the Dave Ramsey seminars. It is really important to marry someone with similar outlooks on finances. Money issues are the number one cause for divorce in the US.