merging money when you become a family

[Anonymous]

Anonymous wrote:.

I'm not sure we can afford a nanny or daycare, at least not for a while. I'm hoping to be able to work from home a few days a week and pay a college student to be a "mother's helper" while I'm there. My Mom will take the baby one day a week. Not sure what we'll do the rest of the time.

I know that you aren't asking advice about this, but as someone who has worked at home for 8 years, working at home with a baby is completely unrealistic. You are going to have to pay for daycare, and you should budget for it. Yes, it is ridiculously expensive and your standard of living may be reduced dramatically, but it is that or one of you stay at home. A college student who is willing to be a "mother's helper" will be as expensive as daycare.

[Anonymous]

Anonymous wrote:I know that you aren't asking advice about this, but as someone who has worked at home for 8 years, working at home with a baby is completely unrealistic. You are going to have to pay for daycare, and you should budget for it. Yes, it is ridiculously expensive and your standard of living may be reduced dramatically, but it is that or one of you stay at home. A college student who is willing to be a "mother's helper" will be as expensive as daycare.

I didn't ask but it was on my mind and I'm glad you posted it. Downtown daycares are so costly and have waiting lists hundreds long. In-home part-time nannies cost even more.

I'm becoming more and more freaked out about how we're going to afford this baby. It's not like we're in terrible shape, but we're not wealthy. In a good year, our household income is about $140,000. What can we afford? It's become clear that we will not be able to pay a mortgage on the kind of house (small but in or close to the city) we hoped to buy. We live cheaply now in a small one-bedroom condo with tiny closets and no laundry in the unit. I could probably earn an extra $500/month renting this place out.

[Anonymous]

Anonymous wrote:We have a shared checking account and shared credit cards that are used for all household expenses, dinners out, travel, etc. We put in a certain amount every month that should cover everything--if we have extra, we put it in shared savings, or just leave it there for later use. Sometimes we come up short, and we put more in.

Beyond that, we each have our own accounts to do with what we wish.

I think it's pretty funny that people who 100% pool their monies think that it's the people who don't who are exhibiting a lack of trust. Because to me, if you don't get to have access to all your partner's accounts, you need a lot more trust that he/she isn't blowing through all "their" money and won't suddenly come up short when the household expenses need to be paid.

The people with 100% pooled finances to me seem like controlling fraidy cats, who want to be sure they are aware of where every single penny goes.

Also, I think the ladies who are in 100% pooled finances sometimes doth protest too much--trying to make their arrangement sound all modern and "with it," when really it sounds like a throwback to the 50s where women were beholden to their husbands on all financial decisions.

But if it makes you guys feel better to think you actually are the ones without trust issues, you go right ahead.

We have joint accounts and separate accounts, but the way we do our budgeting is that everything goes into the joint accounts except for an equal amount in our separate accounts. We keep the separate accounts for the convenience of having separate check cards. We merged finances when we bought a place together before we were engaged. The idea that couples that keep things separate have more trust is silly, but go ahead and tell yourself that. Why should one partner have more disposable money than the other because he/she earns more if the money is "ours". I have earned more than DH in the past, we earn about the same now and there will likely be a time when he earns more. None of that will affect the relative distribution of funds between us. We have enough independence that we do not monitor each other's day to day spending but we never have a situation where we want to do something such as a vacation but only one of us can afford it. We make all such decisions jointly.

[Anonymous]

Anonymous wrote:

Anonymous wrote:
My husband always offers to split these costs, but honestly, my insurance has covered nearly everything, and since at this time I'm earning more than he is I've been glad to pay for the out-of-pocket costs myself. Things like breast pumps and classes we will surely split, or he'll insist on covering them since I covered the early medical costs.

I am so, so glad I asked this question because you are all giving incredible answers. Thank you so much.

He sounds very…gallant. But do you really want to be having conversations like these for the rest of your marriage? DH and I have integrated finances from day one, and it seems so much more complicated to be constantly negotiating who pays for what with separate finances.

Yeah, you sound more like roommates. Only divorced people or people never married split the cost of the baby. Time to start acting like a single family unit.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I know that you aren't asking advice about this, but as someone who has worked at home for 8 years, working at home with a baby is completely unrealistic. You are going to have to pay for daycare, and you should budget for it. Yes, it is ridiculously expensive and your standard of living may be reduced dramatically, but it is that or one of you stay at home. A college student who is willing to be a "mother's helper" will be as expensive as daycare.

I didn't ask but it was on my mind and I'm glad you posted it. Downtown daycares are so costly and have waiting lists hundreds long. In-home part-time nannies cost even more.

I'm becoming more and more freaked out about how we're going to afford this baby. It's not like we're in terrible shape, but we're not wealthy. In a good year, our household income is about $140,000. What can we afford? It's become clear that we will not be able to pay a mortgage on the kind of house (small but in or close to the city) we hoped to buy. We live cheaply now in a small one-bedroom condo with tiny closets and no laundry in the unit. I could probably earn an extra $500/month renting this place out.

Agree with the PP. You will absolutely need some kind of childcare. You simply can not watch children and work at the same time - it's not possible. If you get an easy baby who takes long naps and is entertained on their own you could probably get 4-5 hours of solid work in, but only up until they get mobile. And if you have a higher needs baby than that goes out the window.

For childcare options consider in-home daycares, or a nanny share where one nanny watches your baby along with someone else's.

On the housing front, we made do in a 1 bedroom (where you went through the bedroom to get to the bathroom) and basement laundry until baby was 7 months old. We were definitely ready for more space at that point, but probably could have made it work even longer if we had to. Babies really don't need to take up a lot of space, and try to borrow the big but short lived equipment (swing, etc.) so you can send it right back to it's owner when you're done with it.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I know that you aren't asking advice about this, but as someone who has worked at home for 8 years, working at home with a baby is completely unrealistic. You are going to have to pay for daycare, and you should budget for it. Yes, it is ridiculously expensive and your standard of living may be reduced dramatically, but it is that or one of you stay at home. A college student who is willing to be a "mother's helper" will be as expensive as daycare.

I didn't ask but it was on my mind and I'm glad you posted it. Downtown daycares are so costly and have waiting lists hundreds long. In-home part-time nannies cost even more.

I'm becoming more and more freaked out about how we're going to afford this baby. It's not like we're in terrible shape, but we're not wealthy. In a good year, our household income is about $140,000. What can we afford? It's become clear that we will not be able to pay a mortgage on the kind of house (small but in or close to the city) we hoped to buy. We live cheaply now in a small one-bedroom condo with tiny closets and no laundry in the unit. I could probably earn an extra $500/month renting this place out.

OP, with all do respect, you sound kind of naive. Do your research now. You can definitely make it on $140k in DC, including the cost of childcare. It may mean that it takes a bit longer to buy, or that you need to cut down in retirement savings for a couple of years, but it is possible. It's time to sit down with your DH and figure out a joint spending plan. Making it up as you go won't help.

Re: childcare, look for a home daycare or nanny share. You will not be able to get work done at home with a baby, and a mother's helper will cost nearly as much as a nanny or nanny share.

[Anonymous]

I would definitely figure out how childcare, diapers, formula, etc. are going to impact your budget before you even remotely think about moving or buying a house. 1 step at a time, OP. How much of the 140k is from your DH? What are his thoughts on all of this, he needs to be involved too or else you are setting yourself up for de facto single motherhood.

[Anonymous]

Anonymous wrote:OP here - thank you, this is really helpful.

I am salaried but my husband is self-employed and his income varies from year to year. Sometimes he makes more than me, sometimes less.

I'm not sure we can afford a nanny or daycare, at least not for a while. I'm hoping to be able to work from home a few days a week and pay a college student to be a "mother's helper" while I'm there. My Mom will take the baby one day a week. Not sure what we'll do the rest of the time.

I hope you/ husband can remain the primary caregivers of your baby. Your mother/relatives are generally the next best option. Use the sitters for supplemental care. Congratulations, btw.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I can't imagine writing a check to my wife. In our house, all expenses are "house" expenses, and they're all paid on the joint credit card, which is paid by the joint checking account. The only separate accounts we have are retirement accounts.

This^^^^^^


We have been merged from day one. Day.One.

My BIL and his wife have not merged. We go out to eat and on the rare occasion when he offers to pay, the two of them look at each other to see whose 'turn' it is to pay.

This is complete insanity to me. We don't have allowances, we trust each other to not spend irresponsibly and that's it - an adult relationship. I pay all of the bills - I make sure we are saving and my wife doesn't wreck the boat.

You say you trust each other not to spend irresponsibly and yet you STILL have this dynamic. I find it's a very common one amongst those who are just *so appalled* that a married couple would maintain separate accounts. My husband doesn't have to make sure I don't wreck the boat because we're already on the same page about our finances and budget, and even though some of our money lives in separate accounts, there's complete transparency as to what that money does. Again, completely merging finances does not save you from financial discord, just as maintaining separate accounts does not impede transparency or trustworthiness.

[Anonymous]

Anonymous wrote:My husband and I basically make the same amount of money, so we pool everything together and it works for us. We don't even have separate accounts anymore, but we married right out of school and so basically came into the marriage with 0 dollars, equal debt, equal salary.

Two solutions I have seen that seem to work for couples who arent' comfortable with total merging:

1) combine a set percentage of your income into a joint account and all family/household expenses go through that. The percentage is useful when there's a big discrepancy in salary.

2) combine all money into a joint account, but each partner maintains a separate account with "their own money." My boss, who makes the same as her husband, does this and they use their separate accounts for fun stuff like girls' weekends, golf trips, spa treatments. Otherwise, they manage the household together.

+1 Love the percentage idea.

We always pooled our money because it was "our" money. I understand the need to have separate accounts, but I would think that would make the ability to hide cheating easier. We have cash for "personal" spending- when DH goes to the bank, he will withdraw $ and we split it evenly. I prefer to use CC and cash makes me nervous, so he keeps it for me, knowing that $ will go to my cc purchases. We discuss big purchases or if I need to do back to school shopping or xmas shopping, we decide on a budget for that and I just put it on the cc (which is paid off each month).

We have joint CC. Once you are married, your credit becomes tied together, so joint CC doesn't matter.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:
My husband always offers to split these costs, but honestly, my insurance has covered nearly everything, and since at this time I'm earning more than he is I've been glad to pay for the out-of-pocket costs myself. Things like breast pumps and classes we will surely split, or he'll insist on covering them since I covered the early medical costs.

I am so, so glad I asked this question because you are all giving incredible answers. Thank you so much.

He sounds very…gallant. But do you really want to be having conversations like these for the rest of your marriage? DH and I have integrated finances from day one, and it seems so much more complicated to be constantly negotiating who pays for what with separate finances.

Yeah, you sound more like roommates. Only divorced people or people never married split the cost of the baby. Time to start acting like a single family unit.

+1

I think people who split everything in the beginning are doing so because they expect it will make things easier when they divorce. They are thinking like singletons not a married unit. We combined everything in the beginning because it was "till death do us part." and we were committed to making it work. Married 9+ years.

[Anonymous]

Anonymous wrote:We have a shared checking account and credit card for all house bills - rent, utilities, lawn service, daycare, groceries. We have a budget and we each contribute proportionally. For example - if our monthly budget is $6k and I make $150k and he makes $75, I contribute $4k each month and he contributes $2k.

Our "house down payment" money and emergency fund are in a joint Vanguard account. We both had investment accounts there when we married and we joined them.

We each have our own checking, savings, and credit card. We keep our retirement separate - but my higher income subsidizes him being able to max out his TSP.

We pay for our own clothes, gifts, cell phones, haircuts. We're not super careful about keeping things even - which is to say we pay very little attention. I pay for some baby clothes out of our joint account and others out of my money. He pays for dry cleaning on the house card even though it's mostly my clothes. He often pays for dinner out of his account even though we agree it's a house expense.

Sounds like a lot of work keeping track of who's paying for what out of what money. Don't you have anything better to do?
Either it's "His" and "Her" money or it's "Ours."

His/Her sounds like you're expecting to divorce.
Ours means you're both in it for the long haul.

[Anonymous]

Anonymous wrote:
I think people who split everything in the beginning are doing so because they expect it will make things easier when they divorce. They are thinking like singletons not a married unit. We combined everything in the beginning because it was "till death do us part." and we were committed to making it work. Married 9+ years.

Bully for you. Our setup of joint accounts for household expenses and separate accounts for the rest of our earnings has worked for 19 years.

Anonymous wrote:
We always pooled our money because it was "our" money. I understand the need to have separate accounts, but <b>I would think that would make the ability to hide cheating easier</b>.

And who was it who said that having all money pooled shows how much the partners trust each other?

[Anonymous]

FWIW, Suze Orman recommends that a couple have three pots: his, hers and theirs.

[Anonymous]

Anonymous wrote:FWIW, Suze Orman recommends that a couple have three pots: his, hers and theirs.

Or, in her case (and mine) hers, hers and theirs.