Comments on: Why Are You In Debt? (Part 3)

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By: Why Are You In Debt? (Part 3) « gailvazoxlade.com Discount b on Me

Why Are You In Debt? (Part 3) « gailvazoxlade.com Discount b on Me — Fri, 08 Jan 2010 08:34:27 +0000

[...] here: Why Are You In Debt? (Part 3) « gailvazoxlade.com tags: file-the-paperwork, full-due, insuring-ones, paperwork, poa, protection-through, [...]

By: tigerlily

tigerlily — Fri, 08 Jan 2010 04:56:05 +0000

Thanks Marie and Mrs T, I will make sure he knows because I don’t think he is thinking this way yet and he is a great guy and a great dad.

By: Laurie

Laurie — Fri, 08 Jan 2010 03:17:18 +0000

Even when you’re dating…there are danger signs…like they allow you to pay for everything. All of your stuff is in the open, and yet you know nothing about theirs. Thank goodness it didn’t work out for other reasons…or I’m sure he would continue to allow me to pay for everything…my bad. Oh that’s right I just paid for the everyday things…he paid the twice a year we went out for dinner…because he wanted to keep up the “show”.
The biggest problem in this area…was that we NEVER talked about money. I am so relieved that I am out! And no matter how uncomfortable, if a relationship ever gets that serious again…this will be discussed.

By: MP

MP — Fri, 08 Jan 2010 03:13:40 +0000

Manisha I couldn’t agree with you more. Getting your financial house in order also means getting the wills and POAs in order. As Gail often says, crap happens. What if you’re in an accident and in hospital for months? Who will pay your bills, who will pay your mortgage, who will make those decisions about your care, who will file the paperwork for your sick benefits or disability insurance etc.

Update your will and POA anytime you have a life change. We’re just going through changing our wills and POA documents now because we are deemed common-law and my will is from when I was carefree and single…

If your spouse is your executor or POA, make sure you have a second person named. You and your spouse could be together when something disastrous happens.

Go through your life insurance, your investments, your work pension fund and make sure you have the proper beneficiaries if you’ve remarried, or divorced. If you have children, make sure that you have legal guardians in case anything happens to you and your spouse. Think hard about naming your parents as legal guardians. If they’re in their 60s or 70s do you really think it’s fair to them to have them raising young children if something should happen to you?

Crap does happen. A tidy financial life should also extend to a tidy “what if” life which means spending time (and sometimes money for the wills and POAs) to get the paperwork in order.

By: Mrs. T

Mrs. T — Fri, 08 Jan 2010 02:35:36 +0000

Tigerlily,
If your friend is considering joint custody or sole custody tell him that if he moves out without the children and a long custody battle ensues, a judge may lean towards maintaining the “status quo”, which will likely be the mother having physical custody of the young children. If he wants to increase his chances of getting custody or joint custody, he should not move out of the home the children live in. I agree that getting lawyers involved sometimes complicates things beyond necessary, but with his wife having a lawyer for a close friend, it’s clear that she is receiving legal counsel, and I’d advise him to do so as well. I wish him lots of luck! These separations can get mighty ugly.

By: Marie

Marie — Fri, 08 Jan 2010 01:07:11 +0000

to tigerlily:
I would recommend seeking legal counsel ASAP. Leaving the matrimonial home means different things in different provinces. Some people live under the same roof during separation if finances does not allow them to do otherwise. If there is no physical threat, I would not move out too early but I would put money aside for legal fees. If she NEEDS him out of there, set a precendent and get her to pay for the extra loging until things are sorted out (gets people thinking). Some law schools offer inexpensive help. Search the provincial legal wesbite.

By: Manisha

Manisha — Fri, 08 Jan 2010 00:55:00 +0000

I’m newly married to a wise spender/banker and healthy right now, but several years ago I was extremely ill for several months and required several surgeries. My sick leave benefits covered most of my expenses but what I hadn’t planned for was arranging for someone to actually go pay the bills and keep everything up to date. (this was before online banking) My recovery was overwhelming emotionally and physically but I was back to normal months earlier than expected. However it took longer to repair the damage to my credit. I can’t believe that I seriously never even thought about it once. Oh how young and ignorant I was!!! (The only bill that stayed current was my cell phone since I had it on automatic payments with my CC.)

Anyhow I learned a great lesson from the experience and that helps me plan better now: its called my “What If? Plan” Its not just a financial plan but a “life” plan. So if I get sick again, the payments will continue automatically, my lawyer will provide my husband with a POA to take care of my affairs, I know which accounts carry insurance coverage for disabilities, expenses that won’t be neccesary will be eliminated, I have a document that lists important info my husband will need kept in a secure place. I got the idea from my parents who used to give me a notebook with important info in it, whenever they went on a vacation without us kids back in the day. It was for “the just in case” situations. Maybe its a bit pessimistic, maybe its just a testament to my need to be organized, but it helps me sleep better at night.

By: tigerlily

tigerlily — Fri, 08 Jan 2010 00:43:26 +0000

@Chad: ditto, thank goodness. I know where every penny goes and so does he (now).

However, I have a friend with two under the age of 5 whose (who’s?) wife asked him to move out on New Year’s Day. My first impulse was to tell him to talk to a lawyer and find out his rights before he even leaves the house, no matter how bad it is. Right now they are taking turns staying there but she has asked him to move out. He doesn’t have alot of family or friends in this town and one of her best friends is a lawyer. He is just surviving day to day and talking to a counselor for his emotional problems but I worry that he’s going to get blindsided by her financially/legally. Poor guy. Any suggestions, everyone?

By: KG

KG — Fri, 08 Jan 2010 00:07:14 +0000

My partner and I too keep our incomes separate. The only joint debt we have is a small mortgage, which he pays in full as he makes 3x what I do, other than that all the household expenses are split exactly 50/50. We each maintain our own credit, vehicles, insurance, investments etc. Having been divorced more than once and burned badly each time I too am very jaded on the money aspect of relationships. Although we carry no debt except the mortgage and credit cards are paid in full bi-weekly, we have healthy savings and are on the same page financially it just makes more sense to keep things separate. But we do have good insurance on each other just in case one of us should pass away.
After living a life of always being in debt and pay cheque to pay cheque it is such a relief to be debt free and have savings. I have a plan now and a great weight is lifted off my shoulders. My vehicle is paid for and I will drive her till she dies lol. I have never been a shopper nor have expensive labels been my downfall. It was always simply more outflow than inflow and I was a single mom. But life is good now and I plan to continue living the Gail-way and be debt free forever.

By: Michelle

Michelle — Thu, 07 Jan 2010 20:33:50 +0000

Luckily my husband and I have always kept our incomes and debts separate. He pays mortgage and taxes, I pay the rest. Everyone’s happy, nobody’s complaining about how much the other spends on things since the bills are paid, and so far (almost 15 years…WTH!) everything’s working. We did split up before for a couple of years, had the kids 50/50 and were equal in income, so again, nobody paid the other for anything. And I think that if ever we hit the separation road again, we’d manage to figure it out amicably and still be intact with our own finances and sanity.
Maybe my vision of marriage is jaded (ie. never say you won’t ever separate, as it happens even to people married a gazillion years, just read January’s Chatelaine for proof of that), but I like to think that we’re both protecting ourselves by keeping things from getting too intermingled. I know, may be it’s a morbid way of looking at building a future as a couple if you’re always aware that things can dissolve, but I’d rather that than be totally unprepared IF it did happen and pleasantly surprised when it doesn’t!

By: ioana

ioana — Thu, 07 Jan 2010 19:14:20 +0000

We learned our lesson last year about having disability insurance and a solid emergency savings account.

I am now buying MORE insurance on my own head, just in case, and we’ve saved 9000$ so far also “just in case” because when you’re sick, the last thing you want to worry about is your mortgage…. right?

Hopefully 2010 will be bright…

By: Megan

Megan — Thu, 07 Jan 2010 19:08:41 +0000

Thankfully I can not say Yes to any of the above. But I do know crap happens …. its happens in relationships, its happens to your health, etc so I try my best to plan and ahead and be careful.
I am very thankful that my fiance is on the exact same page as me financially. I was in a relationship with a person prior and they couldn’t hold on to money for the life of them. Money was no object and debt was just a factor of life. It wore me down and stressed me out to the max.

By: Judi

Judi — Thu, 07 Jan 2010 17:57:14 +0000

I was married to a spendthrift, but his spending was on drugs and alcohol (he’s now in recovery)…to the point that we had no money and we were behind on our rent by 2 months and in danger of being evicted. I borrowed the 2 months rent from a generous friend, paid the back rent and left (I paid back this friend completely). We had no assests, but we had no debt due to declaring bankruptcy in 2002. It was terrible. We have an separation agreement written, but he refuses to sign it because it’s “heavily weighted in my favour” (I have custody of the kids) and doesn’t provide any support for him (he isn’t working and hasn’t had a steady job in 4.5 years). He went on welfare and the government came after me for support…something they have to do, but I was not pleased! Thankfully, they took one look at my financials and the fact that one of our children is disabled (autistic), and said I couldn’t afford to support him. He has not given me an ounce of financial support for the kids since I left 2.5 years ago. I have shown the agreement to some of the divorced dads I know and they cannot believe he won’t sign it, that it is more than fair and wished that their ex-wives were as generous as I am! I haven’t asked for the moon, and his visitation with the kids is decent. I could be a lot nastier, but I won’t…my kids love their dad, faults and all. I am not prepared to go into debt fighting him, so I am saving for the divorce slowly, while trying to get him to sign the separation agreement!

Thankfully, I am not ill or disabled, but I know it could happen anytime and I am working on a bigger emergency fund.

By: Sharon

Sharon — Thu, 07 Jan 2010 17:39:21 +0000

Does it count if we were both pretty spend thrifty, and I adapted a bit faster than he did to our new low income situation? We’re on the same page now, because he knows how much stress I build up over our debts. We’ve managed to stick to our allowances.

I don’t see divorce in our future, because we’ll never get married. Thankfully disability has not happened yet, but my boyfriend has a condition that could lead to disability and death if not properly monitored, so That’s been on our minds.