To Be or Not to Be...Married

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
gazelle1991
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To Be or Not to Be...Married

Post by gazelle1991 » Thu Sep 06, 2018 2:02 pm

Hi all,

I am struggling with the decision to wait on marriage vs. getting it done. I know this is a personal decision but I am just looking to see what everyone's thought is under the circumstance.

My fiance' and I just recently got engaged and so as any logical person would do, I ran the #s to see what the financial implication of getting married would be. Here's what I found:
1. Taxes would increase around $500-$1,000 a year before kids. Around $3K a year after kids. At 4% interest rate, 10 year-duration (assuming 1 retired income in 10 years) I estimated the present value of this tax penalty to be around $25K
2. I will no longer be able to contribute the full $5,500 into ROTH IRA x 2 (his and hers) due to his SIMPLE IRA balance. At 4% interest rate, 25% effective tax rate, 10 year-duration, I estimated the present value of this loss of benefit to be $20K
3. His $250K student loan will be kicked off of the income repayment program (REPAY). At 4% interest rate, I estimated the present value of the difference between paying the student loan off vs. taking advantage of loan forgiveness to be around $70K

Total financial penalty for getting married is estimated to be between $100K-$150K in today's dollars depending on the assumptions selected. In essence, that's a $100K wedding.

My fiance' and I live together and at first I could careless about the legality of being married, but once he proposed, I can't seem to shake the feeling of wanting a wedding. Am I just being illogical? What are your thoughts on this? Did anyone else looks into the financial impact of this legal commitment before getting married? I assume our situation is more unique that getting married just hurts us financially in every direction, but I can't imagine any households with kids and dual incomes would be better off being married.

Additional Info that some people had asked for:
Income and Net-worth:
His: 60K/year, net worth negative 200K - Age 28
Hers: 180K/year, net worth 500-600K - Age 27

Both he and I are on the same page about the finances and marriage decision. We both aren't sure about taking the financial penalty for the marriage license given that we are living as though we are married anyways (combined finances, expenses and goals). We do intend to get married eventually at some point when the financial penalty isn't quite as large. We also plan to have kids in the next couple of years. I have no qualm about the income discrepancy and believe we are compatible financially and on other things. We just want to make the best decision for our situation, financially or otherwise.
Last edited by gazelle1991 on Thu Sep 06, 2018 4:25 pm, edited 1 time in total.

barnaclebob
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Re: To Be or Not to Be...Married

Post by barnaclebob » Thu Sep 06, 2018 2:04 pm

What is your income and net worth?

bikechuck
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Re: To Be or Not to Be...Married

Post by bikechuck » Thu Sep 06, 2018 2:08 pm

Follow your heart and not your head. You can make the finances work either way.

Yinks
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Re: To Be or Not to Be...Married

Post by Yinks » Thu Sep 06, 2018 2:10 pm

Have a commitment ceremony and reception. Invite all your friends just like you would a wedding. But don't have a legal officiant and don't sign a marriage license. Heck even celebrate the day as you anniversary for years to come.

Then later when financially convienient, go to city hall and get married by a judge and sign the paperwork Would probably be a good idea to be officially married before having kids.

Best of both worlds if you ask me!

delamer
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Re: To Be or Not to Be...Married

Post by delamer » Thu Sep 06, 2018 2:11 pm

Why would your taxes go up if you had kids as married versus single?

You can file taxes separately even if you are married.

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Tamarind
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Re: To Be or Not to Be...Married

Post by Tamarind » Thu Sep 06, 2018 2:13 pm

I have mixed thoughts on this. I generally think it's important for people planning to be parents to get married, as there's no real substitute for the legal relationships marriage creates.

However the student loan hit in particular is painful. How long is left before forgiveness? Will he experience a tax hit in the year of forgiveness?

How do you feel about using a long engagement (until kids are imminent) to adjust your separate financial situations? Pay that student loan debt down, consider if he can make changes to his retirement account setup, generally start making plans together though without conflating finances just yet. Is the SIMPLE IRA for his current job and if so does he have any plans to change jobs?

When you get married and when you have a party to celebrate your commitment are, as pointed out above, unrelated.

magicrat
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Re: To Be or Not to Be...Married

Post by magicrat » Thu Sep 06, 2018 2:13 pm

Marriage is not a financial decision.

batpot
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Re: To Be or Not to Be...Married

Post by batpot » Thu Sep 06, 2018 2:18 pm

On a purely financial basis...marriage makes little sense.

PinotGris
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Re: To Be or Not to Be...Married

Post by PinotGris » Thu Sep 06, 2018 2:20 pm

magicrat wrote:
Thu Sep 06, 2018 2:13 pm
Marriage is not a financial decision.
I disagree! It is ALL about fiance, taxes, inheritance, estate. If it is only about love then one can commit to exclusive relationship, monogamy, without any ceremony, church, or religion.

Dottie57
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Re: To Be or Not to Be...Married

Post by Dottie57 » Thu Sep 06, 2018 2:22 pm

magicrat wrote:
Thu Sep 06, 2018 2:13 pm
Marriage is not a financial decision.
Agree up to a point. It does entertwine finances. But if op is confident in the relationship,- not just emotionally but with the brain too - get married. Marriage is building a life together.
Last edited by Dottie57 on Thu Sep 06, 2018 2:23 pm, edited 1 time in total.

magicrat
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Re: To Be or Not to Be...Married

Post by magicrat » Thu Sep 06, 2018 2:23 pm

PinotGris wrote:
Thu Sep 06, 2018 2:20 pm
magicrat wrote:
Thu Sep 06, 2018 2:13 pm
Marriage is not a financial decision.
I disagree! It is ALL about fiance, taxes, inheritance, estate. If it is only about love then one can commit to exclusive relationship, monogamy, without any ceremony, church, or religion.
So does it follow that you would pick whom you marry (if at all) based on the biggest financial gain?

THY4373
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Re: To Be or Not to Be...Married

Post by THY4373 » Thu Sep 06, 2018 2:23 pm

PinotGris wrote:
Thu Sep 06, 2018 2:20 pm
I disagree! It is ALL about fiance, taxes, inheritance, estate. If it is only about love then one can commit to exclusive relationship, monogamy, without any ceremony, church, or religion.
+1 And I think we do folks a disservice by down playing the economics of marriage.

mptfan
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Re: To Be or Not to Be...Married

Post by mptfan » Thu Sep 06, 2018 2:24 pm

gazelle1991 wrote:
Thu Sep 06, 2018 2:02 pm
I am struggling with the decision to wait on marriage vs. getting it done.
In my opinion, if you are struggling enough to ask strangers on the internet then you are not ready to get married.

mptfan
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Re: To Be or Not to Be...Married

Post by mptfan » Thu Sep 06, 2018 2:24 pm

batpot wrote:
Thu Sep 06, 2018 2:18 pm
On a purely financial basis...marriage makes little sense.
Really? I don't think Larry David's ex wife would agree with that.

PFInterest
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Re: To Be or Not to Be...Married

Post by PFInterest » Thu Sep 06, 2018 2:28 pm

gazelle1991 wrote:
Thu Sep 06, 2018 2:02 pm
Hi all,

I am struggling with the decision to wait on marriage vs. getting it done. I know this is a personal decision but I am just looking to see what everyone's thought is under the circumstance.

My fiance' and I just recently got engaged and so as any logical person would do, I ran the #s to see what the financial implication of getting married would be. Here's what I found:
1. Taxes would increase around $500-$1,000 a year before kids. Around $3K a year after kids. At 4% interest rate, 10 year-duration (assuming 1 retired income in 10 years) I estimated the present value of this tax penalty to be around $25K
2. I will no longer be able to contribute the full $5,500 into ROTH IRA x 2 (his and hers) due to his SIMPLE IRA balance. At 4% interest rate, 25% effective tax rate, 10 year-duration, I estimated the present value of this loss of benefit to be $20K
3. His $250K student loan will be kicked off of the income repayment program (REPAY). At 4% interest rate, I estimated the present value of the difference between paying the student loan off vs. taking advantage of loan forgiveness to be around $70K

Total financial penalty for getting married is estimated to be between $100K-$150K in today's dollars depending on the assumptions selected. In essence, that's a $100K wedding.

My fiance' and I live together and at first I could careless about the legality of being married, but once he proposed, I can't seem to shake the feeling of wanting a wedding. Am I just being illogical? What are your thoughts on this? Did anyone else looks into the financial impact of this legal commitment before getting married? I assume our situation is more unique that getting married just hurts us financially in every direction, but I can't imagine any households with kids and dual incomes would be better off being married.
IRAs are individual. his SIMPLE has nothing to do with your backdoor rIRA.
you can file MFS for the loans.
a large lavish wedding is illogical yes.
sounds like you dont want to get married.......

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Doom&Gloom
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Re: To Be or Not to Be...Married

Post by Doom&Gloom » Thu Sep 06, 2018 2:32 pm

There are things in life more important than money.
mptfan wrote:
Thu Sep 06, 2018 2:24 pm
gazelle1991 wrote:
Thu Sep 06, 2018 2:02 pm
I am struggling with the decision to wait on marriage vs. getting it done.
In my opinion, if you are struggling enough to ask strangers on the internet then you are not ready to get married.
But, yeah, this!

jjface
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Re: To Be or Not to Be...Married

Post by jjface » Thu Sep 06, 2018 2:35 pm

:oops:
Last edited by jjface on Thu Sep 06, 2018 2:36 pm, edited 2 times in total.

47Percent
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Re: To Be or Not to Be...Married

Post by 47Percent » Thu Sep 06, 2018 2:35 pm

gazelle1991 wrote:
Thu Sep 06, 2018 2:02 pm
2. I will no longer be able to contribute the full $5,500 into ROTH IRA x 2 (his and hers) due to his SIMPLE IRA balance. At 4% interest rate, 25% effective tax rate, 10 year-duration, I estimated the present value of this loss of benefit to be $20K
I don't quite understand point 2.

Also re: student loan, it looks like you are factoring in student loan forgiveness as a given that is 20 or 25 years out. Are you sure your finacee's income is going to remain low so that it won't pay off the balance?! Have you factored in the fact that the forgiven amount is taxable.

PinotGris
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Re: To Be or Not to Be...Married

Post by PinotGris » Thu Sep 06, 2018 2:35 pm

magicrat wrote:
Thu Sep 06, 2018 2:23 pm
PinotGris wrote:
Thu Sep 06, 2018 2:20 pm
magicrat wrote:
Thu Sep 06, 2018 2:13 pm
Marriage is not a financial decision.
I disagree! It is ALL about fiance, taxes, inheritance, estate. If it is only about love then one can commit to exclusive relationship, monogamy, without any ceremony, church, or religion.
So does it follow that you would pick whom you marry (if at all) based on the biggest financial gain?
Whom you marry is different from why you marry. Two people can live together forever simply because that is what makes them happy. They can also part with no regrets. Marriage is a contract, an institution, a licence to practice, and parting has ramifications. And yet we choose to marry because we want all that. All decisions we make are not rational.

bhough
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Re: To Be or Not to Be...Married

Post by bhough » Thu Sep 06, 2018 2:37 pm

OP,
I understand why you’d want to “run the numbers” about getting married, but I’d like to encourage you to go ahead and do it regardless of the numbers. I love being married and it gives you benefits you don’t realize.
Congratulations.
B

Glockenspiel
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Re: To Be or Not to Be...Married

Post by Glockenspiel » Thu Sep 06, 2018 2:38 pm

Combining goals, finances, and expenses has led to a far greater combined net worth than if we weren't married. Just do it (Believe in something. Even if it means sacrificing everything). :D
Last edited by Glockenspiel on Thu Sep 06, 2018 2:39 pm, edited 1 time in total.

KlangFool
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Re: To Be or Not to Be...Married

Post by KlangFool » Thu Sep 06, 2018 2:39 pm

OP,

If you are my daughter, I would ask you to find a good answer on the 250K student loan first before getting married or stay together.

KlangFool

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bottlecap
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Re: To Be or Not to Be...Married

Post by bottlecap » Thu Sep 06, 2018 2:40 pm

You don't believe in marriage.

Does she?

If so, you are incompatible. Split up.

If not, then you two will have to decide whether the legal benefits of marriage outweigh the additional financial cost/loss of government subsidies.

Some would argue there are psychological benefits to children when their parents are married, so feel free to consider that as well.

Good luck,

JT

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MnyGrl
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Re: To Be or Not to Be...Married

Post by MnyGrl » Thu Sep 06, 2018 2:41 pm

"Getting it done"? So romantic. :D

delamer
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Re: To Be or Not to Be...Married

Post by delamer » Thu Sep 06, 2018 2:43 pm

bottlecap wrote:
Thu Sep 06, 2018 2:40 pm
You don't believe in marriage.

Does she?

If so, you are incompatible. Split up.

If not, then you two will have to decide whether the legal benefits of marriage outweigh the additional financial cost/loss of government subsidies.

Some would argue there are psychological benefits to children when their parents are married, so feel free to consider that as well.

Good luck,

JT
The OP is female.

chmcnm
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Re: To Be or Not to Be...Married

Post by chmcnm » Thu Sep 06, 2018 2:53 pm

Marriage is about building a life together. It's a completely different ballgame than dating or living together. Unfortunately, finances have become a major component of the decision making process. It's one of the top reasons for divorce. Taking on $250K in debt right of the bat would be a major red flag.

If you have to ask whether something is a good idea it probably isn't. YMMV.

barnaclebob
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Re: To Be or Not to Be...Married

Post by barnaclebob » Thu Sep 06, 2018 2:56 pm

Doom&Gloom wrote:
Thu Sep 06, 2018 2:32 pm
There are things in life more important than money.
mptfan wrote:
Thu Sep 06, 2018 2:24 pm
gazelle1991 wrote:
Thu Sep 06, 2018 2:02 pm
I am struggling with the decision to wait on marriage vs. getting it done.
In my opinion, if you are struggling enough to ask strangers on the internet then you are not ready to get married.
But, yeah, this!
Here we go again with the judging of relationships by this forum based on extremely limited info. OP just need some advice regarding a financial marriage penalty not judging whether their relationship is strong enough for marriage.

mptfan
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Re: To Be or Not to Be...Married

Post by mptfan » Thu Sep 06, 2018 2:58 pm

barnaclebob wrote:
Thu Sep 06, 2018 2:56 pm
Here we go again with the judging of relationships by this forum based on extremely limited info. OP just need some advice regarding a financial marriage penalty not judging whether their relationship is strong enough for marriage.
The OP asked for input regarding her decision to marry... "I know this is a personal decision but I am just looking to see what everyone's thought is under the circumstance." I provided my thought. What's wrong with that?

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greg24
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Re: To Be or Not to Be...Married

Post by greg24 » Thu Sep 06, 2018 2:59 pm

I strongly caution you against getting married. Why enter a legal contract with the government?

Just live together in happy bliss. Have children.

By avoiding marriage, you can quickly split up if and when you grow tired of each other.

Mr.BB
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Re: To Be or Not to Be...Married

Post by Mr.BB » Thu Sep 06, 2018 3:04 pm

I understand and appreciate the thoughtfulness of reviewing your future financial status. But marriage is about being in love and wanted to spend time and growing with that person not their savings account.
We got married 18 years ago (we did live together for a year first), we never, ever consider our finances (as poor as they were at the time ) an issue with getting married.

if this is causing you this much concern you need to really sit down and talk things over with each other.
"We are what we repeatedly do. Excellence, then, is not an act, but a habit."

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bottlecap
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Re: To Be or Not to Be...Married

Post by bottlecap » Thu Sep 06, 2018 3:09 pm

delamer wrote:
Thu Sep 06, 2018 2:43 pm
bottlecap wrote:
Thu Sep 06, 2018 2:40 pm
You don't believe in marriage.

Does she?

If so, you are incompatible. Split up.

If not, then you two will have to decide whether the legal benefits of marriage outweigh the additional financial cost/loss of government subsidies.

Some would argue there are psychological benefits to children when their parents are married, so feel free to consider that as well.

Good luck,

JT
The OP is female.
Then, ”Does he?"

daheld
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Re: To Be or Not to Be...Married

Post by daheld » Thu Sep 06, 2018 3:11 pm

Getting married oftentimes doesn't make financial sense. Having kids, unless they grow up to be very wealthy, never makes financial sense. Most of us do those things because they make us happy. This is a personal decision, but if you want to get married, get married. If you don't, don't. Have a small ceremony with friends and family and keep it simple. Then start paying off that student loan. I hope with student loan debt like that, there's some corresponding earning potential that'll help make up for it.

barnaclebob
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Re: To Be or Not to Be...Married

Post by barnaclebob » Thu Sep 06, 2018 3:12 pm

mptfan wrote:
Thu Sep 06, 2018 2:58 pm
barnaclebob wrote:
Thu Sep 06, 2018 2:56 pm
Here we go again with the judging of relationships by this forum based on extremely limited info. OP just need some advice regarding a financial marriage penalty not judging whether their relationship is strong enough for marriage.
The OP asked for input regarding her decision to marry... "I know this is a personal decision but I am just looking to see what everyone's thought is under the circumstance." I provided my thought. What's wrong with that?
The implication of your statement is towards the emotional aspects of the relationship for which OP has given no real info about and not the specific financial aspects.

gazelle1991
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Re: To Be or Not to Be...Married

Post by gazelle1991 » Thu Sep 06, 2018 3:13 pm

barnaclebob wrote:
Thu Sep 06, 2018 2:04 pm
What is your income and net worth?
I make about $180K all in. Networth about $500-$600K
He makes about $60K. Networth negative -$200K due to the student loan.
Last edited by gazelle1991 on Thu Sep 06, 2018 4:12 pm, edited 2 times in total.

gazelle1991
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Re: To Be or Not to Be...Married

Post by gazelle1991 » Thu Sep 06, 2018 3:15 pm

Yinks wrote:
Thu Sep 06, 2018 2:10 pm
Have a commitment ceremony and reception. Invite all your friends just like you would a wedding. But don't have a legal officiant and don't sign a marriage license. Heck even celebrate the day as you anniversary for years to come.

Then later when financially convienient, go to city hall and get married by a judge and sign the paperwork Would probably be a good idea to be officially married before having kids.

Best of both worlds if you ask me!
That was what I wanted but he and his family did not get on board with the idea. They thought it's weird to have a "wedding" without actually signing the paper. That would be my preference as well: best of both worlds lol.

gazelle1991
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Re: To Be or Not to Be...Married

Post by gazelle1991 » Thu Sep 06, 2018 3:17 pm

delamer wrote:
Thu Sep 06, 2018 2:11 pm
Why would your taxes go up if you had kids as married versus single?

You can file taxes separately even if you are married.
Because you can claim as head of household + single vs. joint/separately. Tax codes favor head of household.

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Doom&Gloom
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Re: To Be or Not to Be...Married

Post by Doom&Gloom » Thu Sep 06, 2018 3:20 pm

barnaclebob wrote:
Thu Sep 06, 2018 2:56 pm
Doom&Gloom wrote:
Thu Sep 06, 2018 2:32 pm
There are things in life more important than money.
mptfan wrote:
Thu Sep 06, 2018 2:24 pm
gazelle1991 wrote:
Thu Sep 06, 2018 2:02 pm
I am struggling with the decision to wait on marriage vs. getting it done.
In my opinion, if you are struggling enough to ask strangers on the internet then you are not ready to get married.
But, yeah, this!
Here we go again with the judging of relationships by this forum based on extremely limited info. OP just need some advice regarding a financial marriage penalty not judging whether their relationship is strong enough for marriage.
Not at all. The OP seems to have run the numbers already and to be asking advice about whether she should proceed anyway. Her request was for opinions, not spreadsheet analyses.

At any rate, it seems like a clear relationship issue even though the post contains dollar figures.

gazelle1991
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Re: To Be or Not to Be...Married

Post by gazelle1991 » Thu Sep 06, 2018 3:22 pm

47Percent wrote:
Thu Sep 06, 2018 2:35 pm
gazelle1991 wrote:
Thu Sep 06, 2018 2:02 pm
2. I will no longer be able to contribute the full $5,500 into ROTH IRA x 2 (his and hers) due to his SIMPLE IRA balance. At 4% interest rate, 25% effective tax rate, 10 year-duration, I estimated the present value of this loss of benefit to be $20K
I don't quite understand point 2.

Also re: student loan, it looks like you are factoring in student loan forgiveness as a given that is 20 or 25 years out. Are you sure your finacee's income is going to remain low so that it won't pay off the balance?! Have you factored in the fact that the forgiven amount is taxable.
On the ROTH IRA, I am comparing what the difference is between putting $5.5K into roth vs. taxable account and cashing it out in 10 years and paying tax on the growth vs. tax free on the ROTH.

On the student loan, I did accounted for the fiance' income increasing at a reasonable % and the tax on forgiven amount.

gazelle1991
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Re: To Be or Not to Be...Married

Post by gazelle1991 » Thu Sep 06, 2018 3:26 pm

bhough wrote:
Thu Sep 06, 2018 2:37 pm
OP,
I understand why you’d want to “run the numbers” about getting married, but I’d like to encourage you to go ahead and do it regardless of the numbers. I love being married and it gives you benefits you don’t realize.
Congratulations.
B
Could you elaborate more on the benefits? I am committed to this relationship and feel certain we are in it for the long run. It's just tough to take take the financial hit given that nothing seems to change for us married or not. We live together and he's on my insurance plan as a domestic partner. We plan on having kids and live the married life, just without the marriage certificate. We also plan on creating wills, POA on finances and health. Maybe there are benefits I haven't thought of.

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MnyGrl
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Re: To Be or Not to Be...Married

Post by MnyGrl » Thu Sep 06, 2018 3:30 pm

gazelle1991 wrote:
Thu Sep 06, 2018 3:13 pm
barnaclebob wrote:
Thu Sep 06, 2018 2:04 pm
What is your income and net worth?
I make about $180K all in. Networth about $500-$600K
He makes about $60K. Networth -$200K due to the student loan.
That is a fairly large income discrepancy - you're a high earner and he is not. You also seem to have a lot of other assets. How old are you?

Is your reluctance also about being the primary "breadwinner"? If you are making most of the money it will be hard for you to stay home with kids (if that is what you want) unless you keep your expenses low.

gazelle1991
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Re: To Be or Not to Be...Married

Post by gazelle1991 » Thu Sep 06, 2018 3:33 pm

KlangFool wrote:
Thu Sep 06, 2018 2:39 pm
OP,

If you are my daughter, I would ask you to find a good answer on the 250K student loan first before getting married or stay together.

KlangFool
What kind of answers would I be looking for? I am not worried about the 250K student loan. I just want to make the best decision for the both of us as a couple. If the only way to be with him is to take the financial hit, I am not worried. It only bugs me because i think he and I would be together anyways married or not so to take on the financial hits seems irrational.

Thanks for the advice!

gazelle1991
Posts: 63
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Re: To Be or Not to Be...Married

Post by gazelle1991 » Thu Sep 06, 2018 3:34 pm

MnyGrl wrote:
Thu Sep 06, 2018 2:41 pm
"Getting it done"? So romantic. :D
Thanks - nothing says romance like a financial question on marriage :)
Last edited by gazelle1991 on Thu Sep 06, 2018 4:03 pm, edited 1 time in total.

KlangFool
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Re: To Be or Not to Be...Married

Post by KlangFool » Thu Sep 06, 2018 3:34 pm

gazelle1991 wrote:
Thu Sep 06, 2018 3:13 pm
barnaclebob wrote:
Thu Sep 06, 2018 2:04 pm
What is your income and net worth?
I make about $180K all in. Networth about $500-$600K
He makes about $60K. Networth -$200K due to the student loan.
gazelle1991,

The numbers are getting weirder by the minute.

1) So, he has 250K in student loan but the income is about 60K.

2) And, his net worth is 200K in spite of the student loan. So, he is choosing not to pay off the student loan.

In summary, you need to make sure that you are compatible with him financially. It is up to you to decide what that means.

KlangFool

gazelle1991
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Re: To Be or Not to Be...Married

Post by gazelle1991 » Thu Sep 06, 2018 3:37 pm

delamer wrote:
Thu Sep 06, 2018 2:43 pm
bottlecap wrote:
Thu Sep 06, 2018 2:40 pm
You don't believe in marriage.

Does she?

If so, you are incompatible. Split up.

If not, then you two will have to decide whether the legal benefits of marriage outweigh the additional financial cost/loss of government subsidies.

Some would argue there are psychological benefits to children when their parents are married, so feel free to consider that as well.

Good luck,

JT
The OP is female.
He and I have the same view. We are making this financial/contractual decision together. If it were important to him to get married, I wouldn't even ask. We both feel that the only thing that changes is the legality of being married and how ppl view us (not that I care - i think he cares more since it's mostly his family that lives close). We are committed.

Texanbybirth
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Re: To Be or Not to Be...Married

Post by Texanbybirth » Thu Sep 06, 2018 3:41 pm

That's so strange. I'm a very logical person, and I never ran the numbers before we were married. Okay that's a lie, I got excited because my wife's employer at the time contributed 6% to her retirement with only a 3% commitment from her. (She's a SAHM now, woohoo!)

You aren't being illogical, you're being human. Money is a small (though not insignificant) part of our life together (with kids), and I can't imagine an analysis like this swaying us away from getting married. In fact, we paid off a significant student loan balance once we were married. I've never once stopped to calculate what that cost us in PV/FV/FCF. (I also believe marriage is a significant social good, so know that's an assumption in the background of my post.)

gazelle1991
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Re: To Be or Not to Be...Married

Post by gazelle1991 » Thu Sep 06, 2018 3:43 pm

KlangFool wrote:
Thu Sep 06, 2018 3:34 pm
gazelle1991 wrote:
Thu Sep 06, 2018 3:13 pm
barnaclebob wrote:
Thu Sep 06, 2018 2:04 pm
What is your income and net worth?
I make about $180K all in. Networth about $500-$600K
He makes about $60K. Networth -$200K due to the student loan.
gazelle1991,

The numbers are getting weirder by the minute.

1) So, he has 250K in student loan but the income is about 60K.

2) And, his net worth is 200K in spite of the student loan. So, he is choosing not to pay off the student loan.

In summary, you need to make sure that you are compatible with him financially. It is up to you to decide what that means.

KlangFool
yes, he has about $50K in the bank and in cars. He wanted to pay off the loan as quickly as possible to the best of his ability but I advised him not to given that he's still on the first 3 years of the income based repayment program where half of the interest is subsidized. I figured it'd be more beneficial to set aside the money and let it grow outside of the student loan. It took some convincing but he finally sees the benefit in doing so.

From a financial POV, I think we are quite comparable. He doesn't judge my "overly financially aware" attitude. Many would mistake my need to understand the #s and options as caring too much about money, but on the contrary, money isn't really the top of my priority. At the end of the day, I just want to make an informed decision that is best for our situation whether that is to marry or not to marry.

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marti038
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Location: Birmingham, AL

Re: To Be or Not to Be...Married

Post by marti038 » Thu Sep 06, 2018 3:45 pm

gazelle1991 wrote:
Thu Sep 06, 2018 2:02 pm
Did anyone else looks into the financial impact of this legal commitment before getting married?
We didn't.

gazelle1991
Posts: 63
Joined: Thu Aug 03, 2017 11:20 am

Re: To Be or Not to Be...Married

Post by gazelle1991 » Thu Sep 06, 2018 3:46 pm

greg24 wrote:
Thu Sep 06, 2018 2:59 pm
I strongly caution you against getting married. Why enter a legal contract with the government?

Just live together in happy bliss. Have children.

By avoiding marriage, you can quickly split up if and when you grow tired of each other.
haha this was my thought process and what he and I talked about before we got engaged. Then I became irrational. He just wants me to be happy and would go along with what I decide whether it is paying for a non-nonsensical piece of paper that the gov't sells

KlangFool
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Re: To Be or Not to Be...Married

Post by KlangFool » Thu Sep 06, 2018 3:48 pm

gazelle1991 wrote:
Thu Sep 06, 2018 3:33 pm
KlangFool wrote:
Thu Sep 06, 2018 2:39 pm
OP,

If you are my daughter, I would ask you to find a good answer on the 250K student loan first before getting married or stay together.

KlangFool
What kind of answers would I be looking for? I am not worried about the 250K student loan. I just want to make the best decision for the both of us as a couple. If the only way to be with him is to take the financial hit, I am not worried. It only bugs me because i think he and I would be together anyways married or not so to take on the financial hits seems irrational.

Thanks for the advice!
gazelle1991,

The issue is not with the loan itself. It is with the attitude and mentality behind him, that ended up with the 250K loan. Are you compatible with that kind of thinking?

1) Why would a person take a 250K student loan to earn 60K per year?

2) Why would a person have a net worth of 200K but not paying off the student loan?

3) Is the person counting on loan forgiveness?

Are you comfortable with that kind of thinking and mentality? You would have to live with that person. And, you would have to live with the consequences of his financial decision in the future. Are you compatible with that kind of thinking?

<< i think he and I would be together anyways married or not so to take on the financial hits seems irrational.>>

It seems to me that you are short-sighted in term of whether you should be married to the person. There is a lot bigger question than that. There could be a lot more financial hits just to stay together.

Both of my nephews got married and divorced in less than 2 years later. They knew their ex-husbands for 6 to 8 years.

Nephew A got stuck with a toddler and a house with a mortgage. Ex-husband not paying child support.

Nephew B got stuck with a house with a mortgage. The house was flooded with a 50K damage. Thank goodness that the extended family pooled our money and send her the money to fix the house.

I wish you nothing but the best. But, please make sure that you are compatible with him financially.

KlangFool

gazelle1991
Posts: 63
Joined: Thu Aug 03, 2017 11:20 am

Re: To Be or Not to Be...Married

Post by gazelle1991 » Thu Sep 06, 2018 3:48 pm

mptfan wrote:
Thu Sep 06, 2018 2:58 pm
barnaclebob wrote:
Thu Sep 06, 2018 2:56 pm
Here we go again with the judging of relationships by this forum based on extremely limited info. OP just need some advice regarding a financial marriage penalty not judging whether their relationship is strong enough for marriage.
The OP asked for input regarding her decision to marry... "I know this is a personal decision but I am just looking to see what everyone's thought is under the circumstance." I provided my thought. What's wrong with that?
Thanks for providing your thoughts on my situation. I definitely feel that we are committed for the long run. Marriage to me is just the piece of paper and how everyone else views us. But is that worth the money to make everyone else happy? I guess it depends on how much he and I care about everyone else (me not so much. He cares more so I care that he cares). Personally, we know we are committed and happy with one another regardless.

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