Family of 5, appx $300K HHI - would you do anything different?

[Anonymous]

Anonymous wrote:You absolutely shouldn't be adding more to your mortgage! You'll never have another mortgage with interest rates so low. You should be maxing your retirement instead.

This! Put it in your retirement! Your mortgage is cheap. Absolutely stupid to put it into the mortgage. You are losing money you could make this way!

[Anonymous]

Thanks again! I’m going to look into doing the YNAB thing on my own account.

I talked to DH a bit more yesterday and he basically said - “my real goal is that I want us to be able to live off your salary and save my salary.” And that I don’t need to be saving anything per se that is in my account - he has the savings account and in effect my account is my slush fund after expenses. And that if there is something I really want to do that over what I make then we can discuss it.

If nothing else - it was a needed convo to get on the same page finally. I’m going to work on my student loans with this YNAB and otherwise budgeting the spending in my account and work on cutting back kid expenses!

I am technically listed on all accounts and as beneficiary.

[Anonymous]

I just want to tell OP that your commitment to this inspired me to talk to DH to make sure we were on the same page about finances and make sure I had access to all accounts and know exactly where our money is going.

[Anonymous]

Anonymous wrote:Thanks again! I’m going to look into doing the YNAB thing on my own account.

I talked to DH a bit more yesterday and he basically said - “my real goal is that I want us to be able to live off your salary and save my salary.” And that I don’t need to be saving anything per se that is in my account - he has the savings account and in effect my account is my slush fund after expenses. And that if there is something I really want to do that over what I make then we can discuss it.

If nothing else - it was a needed convo to get on the same page finally. I’m going to work on my student loans with this YNAB and otherwise budgeting the spending in my account and work on cutting back kid expenses!

I am technically listed on all accounts and as beneficiary.

I'm sorry, but this mindset is so f&(*ed. First of all, each of your salaries combines to form your household income, and all of your spending and saving comes from that. There's no separation, where Jane's salary pays for rent, and Joe's salary pays the car payment. That's just not how married household finances work.

But if you *are* going to think of it that way, how convenient for him that OP's salary (which is 2/3 of HHI) goes toward their *shared* expenses, while husband gets to save all of his salary! And if OP wants to spend money on something, she can "discuss" it with husband! WTF?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Here are kids activity expenses which I guess you can tell me is crazy and you all don’t spend this much for kids activities.

Kid 1: $275/mo. swim, plus appx. $200 each fall and spring for rec sport. (May not continue swimming next year for interest reasons)
Kid 2: $275/mo. swim, plus appx. $1000 each fall & spring for travel sport (but seriously considering switching back to rec only next season for not being worth it for talent reasons)
Kid 3: $300/mo. dance; $160 mo. gymnastics

There is also an $50/mo. instrument rental for a kid.

So this is $16,320/year for kids' activities, *not* including camps. That is a lot. If you've got plenty of money then have fun, but if you're feeling the pinch like you say, then this is an easy place to cut back. If you take Kid 1 out of swim, Kid 2 out of travel, and Kid 3 picks a sport, that's a decent chunk of change that could be directed to 529s.

Once you get all of your numbers lined up, I would pause the mortgage pre-payment and use that $1600/month to pay off one or both cars and possibly your student loan. Then DH can go back to prepaying if he must (you shouldn't be doing this, but people who like to prepay their mortgages don't listen to reason) and you will have freed up ~$1k/month to use for other purposes.

Don't take the kids out of their activities but those activities seem very high, especially for swim except if they are on a high level swim team.

NP. We’re in a similar situations as OP. 3 kids, similar income, similar mortgage. If you live in the DC a area (we’re in McLean), activities are really really expensive. Like little league is $250 per season per kid. That’s just a couple practices and games with volunteer parent coaches. The local swim programs are very expensive. We have a middle schooler who uses to do dance weekly at a studio for $100 a month and that’s jumped to $250 for our youngest for the same level and same class. Plus you have to pay for the recital and outfit now and didn’t used to. Also there’s the fact that on certain geographic areas there are different qualifications for things like music. A kid plays in the school orchestra, and at some point we realized almost everyone else had their kids ina private lesson. We’re not trying to send her to julliard, but she wants to play in the orchestra with friends and feel like she’s keeping up. Private music is expensive. My overall point is I’m not sure this is an area to cut back unless your kids are young, like young elementary or preschool. For older kids, part of their development is trying skills and interests, being part of a team, doing fun things with friends. Also as they get to middle school age and play less outdoors, expertise is harder to come by and a sport like swimming starts to feel invaluable.

[Anonymous]

Also feel like we’re hemorrhaging cash with three school ages kids. Our perspective is if you’re saving well for retirement and college, and doing all the stuff you want and need to do for your family (home you’re happy with, take vacations, kids are thriving in activities, etc), we don’t really need much extra aside from some emergency savings. We’re never going to be Uber wealthy, but when our kids are out of college, we’ll be on good track to a good retirement, and we’re living a decent lifestyle. Not sure what more we nees

[Anonymous]

Anonymous wrote:I just want to tell OP that your commitment to this inspired me to talk to DH to make sure we were on the same page about finances and make sure I had access to all accounts and know exactly where our money is going.

YAY! That makes me happy to hear.

To the PP immediately above, I'm not sure I think there's a real difference except in terms of convenience, to say we make 300K combined and we are going to spend 200K and save 100K. I guess I don't think that's horrible in theory but I am working on YNAB to see how it goes - I just signed up for the free trial and it seems promising. I had no savings before we met - so I probably need him to help me keep track on savings - that is valuable to me.

I did not always make more fwiw even though at the current juncture I do depending on his side business, I consider this a lifelong financial partnership. We sort of agreed that I would retire at 60 and he wants to work practically forever. I was laughing out loud yesterday thinking about about the real long divorce con of meeting a 23 year old making 35K, getting married, then putting her through grad school and paying all room and board and tuitution, but 2 stafford loans to hope years later I become a real cash cow . Wasn't a bad ROI for him there, tho.

[Anonymous]

Anonymous wrote:Thanks again! I’m going to look into doing the YNAB thing on my own account.

I talked to DH a bit more yesterday and he basically said - “my real goal is that I want us to be able to live off your salary and save my salary.” And that I don’t need to be saving anything per se that is in my account - he has the savings account and in effect my account is my slush fund after expenses. And that if there is something I really want to do that over what I make then we can discuss it.

If nothing else - it was a needed convo to get on the same page finally. I’m going to work on my student loans with this YNAB and otherwise budgeting the spending in my account and work on cutting back kid expenses!

I am technically listed on all accounts and as beneficiary.

If that is his plan you need to make sure that money is jointly in both names. This sounds really shady. Pay off that loan and open a joint account and you each contribute to the household expenses and you each keep your money separate. You should each contribute an equal amount.

[Anonymous]

Anonymous wrote:Also feel like we’re hemorrhaging cash with three school ages kids. Our perspective is if you’re saving well for retirement and college, and doing all the stuff you want and need to do for your family (home you’re happy with, take vacations, kids are thriving in activities, etc), we don’t really need much extra aside from some emergency savings. We’re never going to be Uber wealthy, but when our kids are out of college, we’ll be on good track to a good retirement, and we’re living a decent lifestyle. Not sure what more we nees

You have three kids. That is expensive. You are wealthy. It’s how you spend it.

[Anonymous]

OP, I think the people saying "this sounds shady" are reacting more to the fact that you don't know where the money lives and what it's invested in than anything else. Live off one salary and save/invest the other is pretty typical budgeting advice, if a bit aspirational for most.

I will say that you give the impression DH is incredibly risk averse, so as you get more involved you want to not just know where/how much you have, but also what it's invested in. To grow your wealth you don't want a paid off mortgage and a bunch of bonds and CDs and giant piles of cash in checking.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I just want to tell OP that your commitment to this inspired me to talk to DH to make sure we were on the same page about finances and make sure I had access to all accounts and know exactly where our money is going.

YAY! That makes me happy to hear.

To the PP immediately above, I'm not sure I think there's a real difference except in terms of convenience, to say we make 300K combined and we are going to spend 200K and save 100K. I guess I don't think that's horrible in theory but I am working on YNAB to see how it goes - I just signed up for the free trial and it seems promising. I had no savings before we met - so I probably need him to help me keep track on savings - that is valuable to me.

I did not always make more fwiw even though at the current juncture I do depending on his side business, I consider this a lifelong financial partnership. We sort of agreed that I would retire at 60 and he wants to work practically forever. I was laughing out loud yesterday thinking about about the real long divorce con of meeting a 23 year old making 35K, getting married, then putting her through grad school and paying all room and board and tuitution, but 2 stafford loans to hope years later I become a real cash cow . Wasn't a bad ROI for him there, tho.

I’m the pp who asked about your retirement savings. It sounds like you both operate from a whats mine is yours mentality. Which works unless there’s a divorce. So please make sure that this arrangement doesn’t result in there being no retirement savings in your name. Also, prioritizing mortgage pay down over saving for college is depriving you of the power of compound interest. If you want your kids to have good school options, talk to your husband about that.

[Anonymous]

Thanks again!!! I am working on all of the stuff people are mentioning - I will work on accounts and I will check on divorce / retirement savings name and how that matters just for my own protection.

This YNAB is great and I've only just started. I probably feel like I am hemorrhaging cash because we are probably spending more than we are putting into that account each month - but I had a cushion in the account (that is dwindling). So I have to look into that and figure out what to do.

BUT I was just spinning my wheels before this post. Now I am actually looking at numbers in and out and trying to start doing something.

To anyone else flailing right now:
Start where you are. Use what you have. Do what you can.
A year from now, you will wish you had started today.
To try to be better is to be better.

XOXO

[Anonymous]

Anonymous wrote:Thanks again!!! I am working on all of the stuff people are mentioning - I will work on accounts and I will check on divorce / retirement savings name and how that matters just for my own protection.

This YNAB is great and I've only just started. I probably feel like I am hemorrhaging cash because we are probably spending more than we are putting into that account each month - but I had a cushion in the account (that is dwindling). So I have to look into that and figure out what to do.

BUT I was just spinning my wheels before this post. Now I am actually looking at numbers in and out and trying to start doing something.

To anyone else flailing right now:
Start where you are. Use what you have. Do what you can.
A year from now, you will wish you had started today.
To try to be better is to be better.

XOXO

Here's something you haven't specified but needs an answer:

Does your company offer a 401k and if so, are you maxing out your contribution?

If they offer one and you are not maxing it out, you need to get on the YESTERDAY

If that means you then need to cut back on the $1600 extra on the mortgage, then you need to do that and your husband needs to support that -- if he doesn't, he's not being fair and not thinking clearly. He also should be maxing out his 401k if he has one or contributing to a SEP or similar through this side hustle if there's enough coming in there.

It's also not clear(or I missed it) if you have 529s set up for the kids and how much these each have in them and if you are systematically contributing to these. Maybe they all won't go to college but it they do, it's expensive and not getting cheaper.

An additional thing you need to figure out, and sooner is better than later is your net worth.

Based on your ages and your income you should be at $2.5 million net worth to be on target for comfortable retirement.

And if you are anything below $1.3 million, you need to really re-calibrate w/ your investments and retirement savings.

[Anonymous]

Just reporting back.
I spoke to a friend who recently divorced and she said it doesn’t matter whose name the retirement funds are in - the default is that it gets split 50/50.
I’m sure there are various stages of getting your $h!t together and I’m kind of in the not happy stage where I’m like crap - at some point I was spending less than I earned so had amassed a cushion but for quite a while now I’ve been spending more than I earned and now I have to figure out how to reign it in.

I am not yet at the part of my financial journey where I know what would be a good amount to save for retirement (though I expect my husband has some ideas) & if 17:39 is correct, then my husband actually has me on an accurate spending leash - and I really need to figure out how to stay within these new confines.

[Anonymous]

On the spending more than you earn - in the original post you mentioned travel. How much have you spent on travel in the last 3, 6, 12 months? If your income generally more than covers your monthly expenses is travel what’s pushing you over?