Breakup song
(This post is for you, Penny. Hugs.)
You said you wanted to have some space,
Slow it down some and take a break
Well, fuck you, too!
Give me my money back, Give me my money back, you bitch
I want my money back
And don't forget to give me back my black T-shirt!
--Ben Folds Five, "Song of the Dumped"
You know how the story goes. Two people meet and fall in love. Maybe they get married; maybe they don't. Either way, they build a life together, and they live happily ever after.
Until they don't anymore.
Then what?
Breaking up often means losing a part of oneself. If that wasn't bad enough, it can also be financially devastating. The worst part is when the couple hasn't been playing in the same financial ballpark: What's fair and right? If the major breadwinner is a frugal person, is it right for that person to hand over an enormous share of assets and future earnings to a spendthrift former partner? If the major breadwinner is a spendthrift and the former partner plays great financial defense, does it make it any more fair?
I don't know the answers. There aren't any easy ones. I thought I was doing the right thing by setting up a prenuptial agreement when I got married, but the joke was on me when my spendthrift husband's salary doubled in two years. After four years of my scrimping along to pay half our expenses on what ended up being half my husband's salary, he headed for greener fields and I had to raid my investment accounts to cover the rent. I left the smoking wreckage with nothing but my own savings, and $10,000 of that went to my lawyer.
Maybe that's fair. It sure didn't feel fair at the time, though.
Last week, Forbes published an article for unmarried couples about not getting stuck paying for a partner's financial problems. The worst-case scenario for unmarried couples is that when the couple has a major disparity in personal financial responsibility and the better-off party co-signins or guarantees loans or credit cards, the better-off party can end up fighting claims against his or her assets following a breakup - just like in a divorce.
The Forbes article suggested five tips to prevent couples from risking their assets if a relationship goes south. They are:
1. Maintain independent financial identities
In other words, don't merge everything: Leave at least one major bank account and credit card in each of your own names.
2. Consider the emotional impact of financial decisions
Does buying a house together mean that you're going to get married? Chances are, your answer and your significant other's might not be the same. If you understand the emotions behind each of your decisions, the financial aftermath of a breakup might not be quite as messy.
3. Avoid joint big-ticket buys with a financially strapped partner
In other words, generosity can backfire big-time, especially if it leads to claims against your assets. Forbes suggests starting small and measuring progress over time before jumping into major joint financing endeavors.
4. Review all joint bills
If your name is on the account, you're on the hook. It's in your interest to know when money is being spent and how. Even more importantly, you don't want to let a joint credit card loose with your ex in the aftermath of a hostile breakup.
5. When in doubt, get legal guidance
Laws vary by state in the US, and possibly by state or province in many other countries. It's important to understand the impact of your financial decisions in advance, because it's a whole lot cheaper than finding out after you've been held responsibile.
This is a decent list, but I think it's missing one important component: Regardless of the health of the relationship, no one gets to fly blind when it comes to money. At best, it shows an unwillingness to be an equal partner in an important aspect of the relationship. At worst, if things go south, it's stupidly dangerous.
What were your best and worst experiences with money in a breakup?
6 retorts. What say you?
Best: When my ex let me use his garage as basically a free storage unit for 6 months and paid for the moving truck when I moved it out. It was fair and he followed up on the agreement long after tempers (and passions) had cooled.
Worst: (different guy) He emptied my bank accounts via an ATM, ran up my credit cards, and then later sent payments on his portion of the court-ordered debt with bad checks. (classy guy) But then the whole (and only) marriage was like that and I learned valuable and expensive lessons from it.
good list! I think #2 is huge. "Can't buy me love" is not just a great Beatles tune...
Hey there FZ!
You've alluded to being married once before. Have you ever written about your financial break up from your ex? I'm just curious if you think all that advice in this post applies or was worthwhile.
Thanks for indulging my curiosity.
My husband and I follow all of these rules and we are happier for it. He even keeps track of the money he 'borrows' from me. It makes me feel safe. I trust him but I need to know what is going on. Even if we never break up, he could die some day and then where would I be?
The separation has happened, and I think that it might be permanent. I’m gutted. ‘Mr X’ (or should that be Mr Ex?) and I been together for nearly 10 years, since we were 20 and 22 years old. Neither us have ever been in another relationship. But this is a finance blog, so I should try to stick to the topic (but please know that these are not my first considerations – this is just not the place for me to pour my heart out).
Thankfully we don’t many debts (never had credit cards, house is nearly paid off, only other debt is his university bill). I’m grateful that at least we’re not arguing over money and I don’t have to worry about how I’m going to be able to carry on financially. I know a lot of people in divorces and break-ups aren’t that lucky.
So financially, what will change for me?
I’ll spend less on:
Soap – the amount of soap that man used was phenomenal. I buy liquid soap because I hate bars of soap being left around the bathroom and riveting themselves to the side of the bath. Ugh.
Food – Mr X eats a lot, including a lot of meat. And he eats a lot of takeaway (I do too when he’s around). We often bought each other little snacky treats too (so the waistline might see an improvement). Oh, and Pepsi, he drinks heaps of that (and wastes heaps of it too, it’s not unusual to find a couple of still-cold cans in different rooms of the house that he’s opened and forgotten about).
Water – I can’t imagine anyone being able to shower for longer than Mr X…!
I’ll spend more on:
Household bills (water, council rates, health insurance) – because Mr X has always paid these, while I’ve focused on the mortgage (and he’s contributed to our mortgage and savings as well – I just hate paying bills, so he always did it). In July a couple of annual bills are due – at least $1400 worth.
Transport – I will need to think about getting a car (Mr X has a car that he paid all of the costs of running, and I used it whenever I wanted). I catch the bus to work. Or I could take taxis more often on the weekend, rather than getting a car. Lately have been thinking about getting a scooter...!
Cleaning – a possibility. I hate cleaning, Mr X used to do about 75% of the cleaning. I’d consider getting a house cleaner once a fortnight because cleaning makes me so depressed (not a normal response I know, most people just dislike it). Probably cost me $50 - 80 a fortnight, because my house is very small. Could possibly ask my mum for a hand instead.
Therapy – to help me deal with this. Cost about $100 – 150 per session, probably 1 – 2 sessions per month.
Housing – our house was nearly paid off – I was soooo looking forward to that! Now I’m thinking I might try to buy Mr X out. That would cost me about $170,000. Geez Louise – that’s how much we paid for the house 7 years ago!
Ugh, I could go on, but I’m getting a bit down… God I wish this wasn’t happening. It doesn’t seem real.
Thanks for the post FZ.
(Oh, I’ve never heard that Ben Folds song – can’t wait to YouTube it now!)
My first wife and I were very young when we met. Being quite stupid at the time, I married her because it seemed the right thing to do. I was feeling protective, and she was definitely in need of protection. We did not discuss money at all; I had a job and she was willing to get one. Mistake. Just before it was all over 10 years later, I discovered she had been taking money out on a visa (chargex at the time) to pay mastercard. We came out of that divorce with about $700. each.
Five years later, I went common-law with another woman. She had a bit of money from a previous marriage and had never worked more than part time. Again, being quite stupid, we didn't discuss money before the relationship started. My savings quickly disappeared, investments were not permitted and we took expensive holidays and spent a lot of money in the RV world instead. When we split 5 years ago, I was so anxious to get away from her, I gave her 95% of our assets. plus she got a good chunk of my pension. Ouch.
Then I met my 3rd wife, and being much smarter now, we spent a lot of time talking about money issues. She had a good track record of self discipline and plenty of ambition. We developed a plan and the results have exceeded expectations. Now that may sound more like a business than a marriage, but we are very happy even though we live frugally. Saving on an expense really is like earning tax free.
Money has got to be the number one topic for couples. It affects everything. Want kids? It'll cost you plenty .... you got to add it all up first. Want to live in the suburbs? Can you walk or bus to work? Transportation is a huge part of your budget. You need a joint strategy.
To assume your S.O. is on the same page is foolish. A lot of people don't even have a page.
By the way, don't feel sorry for me. I've had what feels like 3 lifetimes, lots of sad and happy, no bitterness and no regrets. My cup, even when completely devoid of water, at least has potential.
MtnMama - Your worst experience is really bad - I'm so sorry! It sounds like you recovered, though, and that's the most important thing.
mapgirl - I've thought about writing about the financial break from my ex many times, but I think it's kind of boring. We had mostly separate assets and a prenup. Why we set it up that way might be a better story. . . I'll give it some thought. Thanks for the input!
SarahA - What a great system. That's exactly the kind of thing that would work well for me, and for the very same reasons. thanks for contributing.
Penny - Hugs and more hugs. A relationship of ten years' standing is essentially a divorce, and that's so hard. Therapy helps, but I found that family, friends, the passage of time, and a change of environment helped more than anything. Vent away anytime here, or email me at frugal (dot) zeitgeist (at) gmail (dot) com if you wnat to chat offline.
Gord - Thanks for sharing your experiences. I think you're dead on that making assumptions about one's SO being on the same page financially is can be enormously damaging in the long run. I really admire your philanthropic view and since you started commenting here, you have definitely influenced my giving. Thanks for that.
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