Scott Pape: Couples need to share their money if they are going to share a life

THERE is one thing all couples should do if they want to have a happy life together, writes the Barefoot Investor.

The person who doesn’t want to share has control issues.

THE No.1 predictor of couples staying together is whether or not they share their finances. How can you plan a life together if you don’t share your money?

EMMA ASKS: I am 27 and newly married. My husband earns more than double what I do, and he does not like the idea of combining our finances. Instead, things are split down the middle, though he saves over twice the amount I am able to. Is there a way to start broaching the Barefoot ideals without having huge arguments? I am really unsettled by it.

BAREFOOT REPLIES: I actually read your question out to Liz ... and she shut me down as only a wife could: “Honey, you’re not Dr Phil ... just stick to the finance.” Bam! That’s why I love my wife — she gives me brutally honest feedback, and most of the time I don’t even have to ask for it! Still, I’m going to sidestep her sledge and answer your question. Reason being, I’ve had thousands of conversations with couples, and the No.1 predictor of staying together is whether or not they share their finances. (OK, so another predictor would be if hubby is shagging his secretary, or if wifey is an ice addict … but you get my drift.) It makes sense when you think about it: How do you think his plan is going to work when you leave work to raise kids? Seriously, how can you plan a life together if you don’t share your money? Here’s what I’ve worked out: the person who doesn’t want to share has control issues (that would be your husband) — and the other eventually learns to adapt.

A study released this week by Finder.com.au found that nearly one in three Aussies keeps at least some of their spending a secret from their partner. No winners there. So, what should you do? I’d suggest you have your husband read my book, The Barefoot Investor: The Only Money Guide You’ll Ever Need. Yes, that’s a blatant plug, but there’s a good reason: I’ve structured the steps around having Barefoot Date Nights where you work on your finances as a team (with wine and garlic bread in your hand). And if he refuses? Well, far be it for me to play Dr Phil, but I’d suggest you take a leaf out of my wife’s book, and tell it to him straight. Good luck.

CALL A LAWYER ... NOW

JENNY ASKS: About 18 months ago I put a $15,000 deposit on an off-the-plan apartment. The idea was to sell my home for the same amount as the apartment and move in. But I have not sold my home and it is now worth less than the apartment. I have been caught by the development finishing six months early, combined with a flat housing market in Perth. I asked for an extension and got 30 days from settlement, but after that I get penalised. So, can I legally get out of this deal, or can they just bankrupt me? I only have my house, my car and a very little super, as I had a stroke in 2002 and used my super then. I also get easily bamboozled due to the stroke. I work two days a week and am on a disability pension, earning approximately $44,000 a year. I am 71 (and single), so my ability to get a loan or pay one off are minimal. Please help me — I cannot see any way out except one, and that would leave a big mess for my children. I would not do that.

BAREFOOT REPLIES: You’re definitely in the dung ... I just don’t know how deep you are. Now, some people believe they can walk away from an off-the-plan development and only lose their deposit. Yet that’s not always the case. Ultimately it depends on what’s in the contract you signed, and how desperate the developer is … and given Perth apartment prices are cratering at the moment, I’d wager they’re as desperate as I was at my high school formal. The worst-case scenario is that your developer swallows your deposit, hits you with financial penalties for not settling, and then sues you for the losses of on-selling your apartment (when they eventually find a buyer). But that’s all in the future, maybe. Let’s you and I just deal with the next 30 days. It’s highly unlikely you’ll be able to settle in the next month, and it’s also highly unlikely you’ll get bridging finance. So here’s my advice: see a lawyer immediately. Let me be crystal clear, Jenny. Put down the newspaper. Pick up the telephone. Call a lawyer. Have them review your contract, then ask their advice on mounting a case for being released from the contract due to your impaired judgment. What are you doing still reading, Jenny? Get on the phone. Now!

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LIVING THE DREAM

BILL WRITES: I have suffered with chronic alcoholism and drug addiction my whole life. Father not present, nor any real family. Mum (the main provider) died suddenly when I was in my mid-20s. Never really holding down a job, I faced being homeless. Very scary times. But I took control. I cleaned the family home and rented it out. This gave me space to go to rehab. I was there for 18 months and re-learnt everything — how to live, how to look after myself, how to be accountable — and I have been 100 per cent sober now for five years. I also went to TAFE, and found a job in sales at a contact centre. I have held that job for three years and have been promoted to managing a team of reps. Earning around $80,000, I have some money to invest, so I have got on to your newsletter and am learning more each day. I now have $40,000 in my “Grow” account and an investment portfolio worth $27,000. I am proud to say I have just built my brand new home, and am renting out a room to subsidise costs. I have also been overseas six times in the past two years. I took control of a very scary situation at a very uncertain time in my life.I am now living the life of my dreams — a far, far cry from the person I was when my mum died.

BAREFOOT REPLIES: You’re a shining example of how anyone can tread their own path. Your mother would be proud. You got this!

 

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The Barefoot Investor holds an Australian Financial Services Licence (302081). This is general advice only. It should not replace individual, independent, personal financial advice