Pages

Thursday, March 10, 2016

Money Talks

I've been reading The Grumpy Rumblings of the (Formerly) Untenured blog lately. Their personal finance posts make me kind of uncomfortable because I don't think we've done a good job of planning or saving. We're not frugal and we haven't paid down our mortgage (although we did refinance to shorten our term) and we won't be able to retire early. Which mostly I think is fine...except when I read their posts.

But anyway, I read this post about how we communicate about money and I commented. Sam and I communicate fairly easily about money; we discuss major decisions, we have similar values, we have enough money so that we can each buy the things we want. I'm not surprised to read that money is a source of conflict for a lot of couples, or that one member of the couple manages the money. I was astonished to see how many commenters say that they give their partner an "allowance". 

I give my daughter an allowance. I had an allowance when I was a child. I don't give my husband an allowance and he doesn't give me one. I understand the value of having money you can spend without accounting to your partner for every penny, and I can see the reasons for deciding ahead of time how much that will be each month. But an allowance? As an adult? That just rubs me the wrong way.

Is it just me? Do you have an allowance? Do you give your partner an allowance (if you have a partner)? Am I completely over-reacting to a perfectly reasonable word?

22 comments:

  1. We keep our money separate and settle up twice a month. That's worked from 1979-present. We are very different about money, and I don't think we would be together if we pooled it. We are childless by choice, so perhaps that made our way of handling money easier.

    ReplyDelete
  2. I think that when a couple has a tight budget and/or aggressive savings goals, it makes sense for each person to have some amount of money to spend as he or she wishes to reduce arguing over how personal money is spent. If the term "allowance" seems to juvenile, it can always be called something else (personal money, personal budget, fun money, etc.).

    Have you ever talked to a financial advisor about your savings rate? A good financial advisor can be helpful for figuring out what your financial goals are (or should be) and whether you're on track to meet them.

    ReplyDelete
  3. The term "allowance" rubs me the wrong way too, but maybe for some people it's shorthand for saying "personal budget for frivolous spending." OTOH, I set my own budget. If I had a partner telling me what I could and could not buy, it would really make me mad!

    ReplyDelete
  4. We have a joint account. I make considerably more than Hubby. He does the bills and balances our checkbook (well, online accounts). We discuss all purchases over $100 that aren't groceries/target/presents. Hell, we even discuss the minor purchases in a off-hand way - "I need new shoes and going tomorrow."

    My friends think we're weird for all of this.

    ReplyDelete
  5. Allowance as that word, we don't use. Budget is what we use. I have a line in our budget for my considerable Starbuck problem. There is a miscellanous/cash budget line too.

    ReplyDelete
    Replies
    1. "Considerable Starbucks problem". :-). That's hilarious. I have a considerable dunkin donuts coffee problem. We have worked hard tho, and I kind of feel like we deserve the right to our Starbucks or dunkin coffee problems!!

      Delete
    2. My considerable Starbucks problem was solved when my office moved and is no longer across the street. The coffee bar in the hospital is much cheaper (and deducts from payroll, so it doesn't show up on my credit card bills).

      Delete
  6. We do "allowance" but call it fun $. I like to spend on some things that he doesn't agree with. However it's a very small amount of our joint $ - like $1000-200/month. Otherwise we're pretty much in agreement about big $ lurchases and goals. It seems to work well.

    ReplyDelete
  7. On budgeting it depends on what you prioritize, and there is always a tradeoff between time and money. On the allowance, we have fun money accounts no questions asked.

    ReplyDelete
  8. Thanks for linking our blog!

    An important point of clarification. I do not "give my husband an allowance". He gives himself and keeps track of his own allowance. Another term for this is "fun money." We talked about the initial amount when it was originally set and talk about it whenever it changes (so we're making more money, we're making less money, etc.), but to be honest I would have to ask him what the exact numbers are.

    It works very well for him because he has a min-maxing personality when it comes to money. Before we married, he simply spent all his money. If he had money, he would look for something to buy until he had no more money. After we got married but before the allowance, he wouldn't buy anything fun. Neither of these situations made him happy. With an allowance (or budget or fun money account) he can spend everything from an account and get the joy of shopping without hurting our bottom-line. https://nicoleandmaggie.wordpress.com/2012/11/12/what-the-allowance-does/

    My personality isn't like that, so I don't have an allowance and would feel irritated and constrained if I had one, but I also spend significantly less than he does on unnecessary items and get no joy from the act of shopping like he does. I also don't budget, but have our system set up so we spend significantly less than we earn. If my husband were in charge of the money, he would probably prefer a budget (and we would be able to spend more because we wouldn't need so much cushion).

    ReplyDelete
    Replies
    1. It fells very different to me to give oneself an allowance than to be given one by a partner. I get that. I would still prefer "fun money", but that's just me. When I first met my in-laws, my mother-in-law was given an allowance and it was not "fun money". It was the money she used to buy groceries and run the house. She didn't have access to the checkbook or the ATM card - just the money he gave her. That's still what I think of when I hear adults talk about having an "allowance", and you can see why it bothers me.

      Delete
    2. I have fond memories of spending my entire allowance on candy every week growing up.

      DH's allowance is for spending on whatever he wants so I don't have to, for example, know or care how much he spent on the last board game he bought or how many times he got himself coffee out last week. All other expenses (including when we go out together) come out of general funds.

      Delete
  9. Also, I should add-- nobody on our blog is planning on retiring early. #2 on the blog doesn't even own a house (and my house only cost $265K, so paying it off in 11 years isn't that big a deal compared to people living in actual cities).

    Our blog should only make you feel bad about money if you're one of those irritating bloggers who complains about making a huge salary and being in debt while continually going on vacations, buying fancy cars, buying more house than you can afford etc. etc. etc. In which case, we would like to request that you just shut up about your money "problems". Other than that, we're really laissez faire.

    ReplyDelete
    Replies
    1. I'm a doctor. Most of the people I work with are not. I never ever ever complain about money problems. Our mortgage payment is about 10% of our take-home pay and so we're definitely not house-poor; we put some retirement savings away but not enough to quit a job without having another job lined up. Our money goes to various media (books, Netflix, FiOS, MLB.tv), tickets to live performances and baseball games, and keeping our daughter in dance shoes and supplies. I'm usually OK with our approach, except when I start fantasizing about quitting my job....

      Delete
    2. Well, if being able to quit (or be downsized) without another job lined up is a priority, then that's something worth saving for. My DH has done it as did #2 on the blog and it was well worth it in terms of sanity in both situations. If feeling trapped by a job is a problem, the book Your Money or Your Life has really good insights about how to align your spending/saving with your priorities and with freedom. But if that's not a priority, then it's not as big a deal, especially if you're unlikely to lose your job involuntarily.

      One good exercise to do is a financial fire drill. What would you do in an emergency situation (such as a lost job or a toxic work situation): https://nicoleandmaggie.wordpress.com/2011/05/09/financial-fire-drill/ The answer to that exercise can help with knowing if things need to be changed or not.

      Re: retirement, it's also good to play with some online calculators to see if you're on track for your predicted retirement plans. Most people need to be putting away 10-20% of their income for retirement, with those of us who spent considerable time in graduate school being closer to the 20% in order to catch up for lost earnings years. But you can see where you stand given your current money.

      You might be fine, you might have things you need to change, you might even have more than you need, but it is a good idea to check from time to time. We usually take a look at our overall picture about once a year around tax time or if we're thinking about making a major change (like this year I'm on half pay and we're living in an expensive state for the year).

      This is basically repeating what Solitary Diner said above. Having an hourly fee certified financial planner (not someone who gets money from commission) look at the numbers (or doing it yourself) is the best way of knowing how you're doing financially.

      There's also 2 or 3 good personal finance blogs/sites specifically set up for doctors on the internet. I can't remember what they are, but I'm sure they're easy to find via google.

      Delete
    3. We have a financial planner and he says we're fine. We are fine. If I quit my job tomorrow, we'd be able to eat and pay our mortgage and buy gas and have health insurance. Our lifestyle would change drastically but it would not be a crisis. I'm really just a spoiled brat: some days I want to have all the money I earn without actually having to go to work.

      Delete
    4. Then it sounds like you've done a good job of planning and saving!

      I think most of us would prefer to be independently wealthy, but barring that...

      Delete
    5. If you ever find a way to have all the money you earn without actually having to go to work, please let me know. That's my biggest fantasy at the moment.

      Delete
  10. My husband and I each get an 'allowance'. To us, it means the money we can use on whatever we want without having to discuss or justify with the other person. He mainly spends his on video games, I spend mine on flavored coffees and shoes. When we didn't, I would freak out over how much his games cost, and he would count the pairs of shoes I owned, getting upset when I didn't wear a pair enough for it to be 'valuable'. Having an allowance works for us. I could see it causing problems if they were either uneven, or only one of us had to stick within the budget.

    ReplyDelete
  11. We have a zero-sum budget and we each get "fun money" each month of $100-309 (which has to cover Starbucks, meals we eat separately, books or magazines, hobby-related expenses). My husband calls it an allowance to drive me crazy. Otherwise, things like groceries and clothing come out of their line items but we generally discuss any purchases over about $100.

    ReplyDelete
  12. My husband and I are both not frivolous spenders. I don't think I've ever seen him buy something that I felt was a waste of money, and I am super thrifty--I'm still wearing the same winter coat I had in college! We do ask each other about large purchases, but that's pretty much it. We both work and we pool our income.

    ReplyDelete

Comments on posts older than 14 days are moderated as a spam precaution. So.Much.Spam.