Separate finances: how to deal if one spouse isn't saving enough for retirement

[Anonymous]

My DH and I have a blended family--we each have 2 kids, and we're both the primary care givers for our respective kids. We half one joint account where we put in $ to cover our joint expenses (mortgage, etc.) but everything else is separate. We had a prenup because my income and assets are higher. It has worked well day-to-day but we are on completely different financial tracks for retirement.

I'm on target for a generously funded retirement, have saved in 529s. Ex-DH and I share financial responsibility for our kids. My DH is not in debt, but he is not on track to fully fund retirement, and has no college savings for his kids (who are 14 and 16). He pays for everything for his kids without much financial contribution from his ex. This was his decision to minimize conflict with his ex; legally, he could be receiving monthly child support and a portion of other expenses.

I have tried viewing his arrangements with his ex as their business. DH did make some financial changes when I asked--such as now maxing out annual 401K contributions (which he had never done). But I am starting to feel resentment and fear about our trajectory--that we'll end up retirement aged and staying together and having any semblance of the life I want will mean subsidizing him. If he'd done his best, I wouldn't think twice. I can't understand, though, why he doesn't set better financial boundaries with his ex and pursue child support.

WWYD?

[Anonymous]

Op I am in a similar situation and following.

Predict that you are going to get blasted for this question but I suspect that there many of us (DWs and DHs) dealing with this scenario.

[Anonymous]

When his kids apply for college and fill out the FAFSA, your income and assets will be included on the forms because you are married to their dad. Thei will affect their eligibility for financial aid.

If he is counting on financial aid for his kids to fund college, does he realize their eligibility my be limited because of your income and assets?

[Anonymous]

Thank you for bringing this up, OP. I just posted the following in another thread this morning. Slightly different issue but definitely along the same vein of, what do you do when you/your spouse have different approaches to retirement?




"Did anyone set up a prenup to protect their non-family-related assets (e.g., businesses or trusts) before marriage when you didn't have kids? (Again, NOT interested in assets tied to your family for which I think prenups definitely make sense!)

For example, if you have a very different perspective on saving in 401ks / retirement accounts, setting up a pre-nup to ensure whatever is accumulated in those specific accounts is not considered joint property post-marriage."

[Anonymous]

I don't know what the answer is, but I know some couples with this. Where things go really sour is when the lower-earning or non-earning spouse is pushing the earning spouse to not retire so that the standard of living is kept up. That's a recipe for disaster. Not always divorce, but miserable marriage.

[Anonymous]

I have no idea why anyone in your situation would have ever gotten remarried. Helpful, I know. Why on earth did you marry this man? Is it because your exes moved on, and you wanted to look like you still “had it” and weren’t knocked on your @ss by your divorce to your social circles? Is it because you were scared of aging alone, and you thought this would insure against that? Was this an affair that became public and you needed to “legitimize” it by getting married? You seem like a planner with foresight, so I’m stumped.

You have gained nothing and even his kids will be further screwed when they apply for college financial aid. There’s already going to be a rift between the kids when one set has college paid for, but now his kids will hate you even more when they have to account for your income in the college application process, but won’t benefit from it.

I’d tell DH what you laid out here. I’d be completely resentful if I were in your situation, too. Tell him that he needs to nut up and get CS out of his ex or that this isn’t going to work out long term.

[Anonymous]

Anonymous wrote:I have no idea why anyone in your situation would have ever gotten remarried. Helpful, I know. Why on earth did you marry this man? Is it because your exes moved on, and you wanted to look like you still “had it” and weren’t knocked on your @ss by your divorce to your social circles? Is it because you were scared of aging alone, and you thought this would insure against that? Was this an affair that became public and you needed to “legitimize” it by getting married? You seem like a planner with foresight, so I’m stumped.

You have gained nothing and even his kids will be further screwed when they apply for college financial aid. There’s already going to be a rift between the kids when one set has college paid for, but now his kids will hate you even more when they have to account for your income in the college application process, but won’t benefit from it.

I’d tell DH what you laid out here. I’d be completely resentful if I were in your situation, too. Tell him that he needs to nut up and get CS out of his ex or that this isn’t going to work out long term.

Since my question was financial this is the money/finance forum, I focused on those details. Neither of our respective exes have moved on, neither of us was afraid of being alone, neither thought we'd marry again, and we both had/have strong community and social connections. I did not think I'd ever want to marry again. But we met (after divorce), moved slowly, enjoyed the hell out of each other, and our daily lives are much better together. Our kids get along well and we each get along very well with each others' kids. We don't "parent" or discipline each others' kids, our own only. It's worked extremely well for us. DH has a good salary, is highly respected in his field and loves his work. Same for me. We both have a lot of flexibility and a rich home life.

We started living together after several years, and only after all 4 kids asked us to do it. At first we didn't marry because neither of us needed that part of it. After consulting with lawyers and looking at the big picture, it was clear to us that even with living wills and powers of attorney, we couldn't replicate all the protections and benefits of marriage. The prenup protected my assets (including my retirement fund), and we both have estate plans that we want for now (assets going to our respective kids). One financial reason for marriage was significant mutual savings on health insurance (we save $1500+/month).

We have a strong partnership in most respects and we're both awed, nearly 10 years in, by being together. Every couple has their issues, and this is the thing that bothers me the most.

[Anonymous]

Op - how is college for his kids going to be paid for?

[Anonymous]

When I remarried, by DH had already retired from the military. He has a lot more saved than I ever will because my XH paid virtually no CS through the crazy daycare years and has been working off the books or simply not working.

The way we handle the disparity is that we are living modestly now. Apartment. Used cars. I rarely buy clothes or furnishings. I do my hair and DD’s hair at home except once a year. Almost no vacations. This allows us to avoid debt even if we can’t save more.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I have no idea why anyone in your situation would have ever gotten remarried. Helpful, I know. Why on earth did you marry this man? Is it because your exes moved on, and you wanted to look like you still “had it” and weren’t knocked on your @ss by your divorce to your social circles? Is it because you were scared of aging alone, and you thought this would insure against that? Was this an affair that became public and you needed to “legitimize” it by getting married? You seem like a planner with foresight, so I’m stumped.

You have gained nothing and even his kids will be further screwed when they apply for college financial aid. There’s already going to be a rift between the kids when one set has college paid for, but now his kids will hate you even more when they have to account for your income in the college application process, but won’t benefit from it.

I’d tell DH what you laid out here. I’d be completely resentful if I were in your situation, too. Tell him that he needs to nut up and get CS out of his ex or that this isn’t going to work out long term.

Since my question was financial this is the money/finance forum, I focused on those details. Neither of our respective exes have moved on, neither of us was afraid of being alone, neither thought we'd marry again, and we both had/have strong community and social connections. I did not think I'd ever want to marry again. But we met (after divorce), moved slowly, enjoyed the hell out of each other, and our daily lives are much better together. Our kids get along well and we each get along very well with each others' kids. We don't "parent" or discipline each others' kids, our own only. It's worked extremely well for us. DH has a good salary, is highly respected in his field and loves his work. Same for me. We both have a lot of flexibility and a rich home life.

We started living together after several years, and only after all 4 kids asked us to do it. At first we didn't marry because neither of us needed that part of it. After consulting with lawyers and looking at the big picture, it was clear to us that even with living wills and powers of attorney, we couldn't replicate all the protections and benefits of marriage. The prenup protected my assets (including my retirement fund), and we both have estate plans that we want for now (assets going to our respective kids). One financial reason for marriage was significant mutual savings on health insurance (we save $1500+/month).

We have a strong partnership in most respects and we're both awed, nearly 10 years in, by being together. Every couple has their issues, and this is the thing that bothers me the most.

You missed a pretty significant portion of the "big picture." Be awed all you want; you still (i) screwed his kids when it comes to cllege, unless you help pay for it, and (ii) will end up supporting him in returement.

[Anonymous]

For better or for worse - you are a team now.

[Anonymous]

If he has a good salary, FA might have already been out of the picture. OP, I think you're going to have to accept that you will subsidize his retirement. If you were a man, you would be broiled here for suggesting otherwise. As for his kids college, I agree with one of tg he PPs that ypu need to push him to get money from his ex. His kids deserve your advocacy for their future.

[Anonymous]

If you really love this guy, you could consider cross subsiding him. This is what (virtually all) men do for (virtually all) women and have done since the dawn of time.

[Anonymous]

Anonymous wrote:For better or for worse - you are a team now.

This. This situation is a good example of how "separate finances" for married couples don't exist.

[Anonymous]

I’d encourage him to start saving and increase my own saving.