Income levels and relationships

[NewEnglandLady]

Date: 6/15/2010 10:43:49 AM
Author: elle_chris
For those that say it doesn''t matter, does the higher earner have more veto power towards larger purchases like a car, or house? I imagine they would as they''re the ones that would take on most of the payment responsibility...

The way it works in our marriage is that if one person vetos, then it''s a no-go (for big purchases).

 

[Haven]

Date: 6/15/2010 10:43:49 AM
Author: elle_chris
For those that say it doesn''t matter, does the higher earner have more veto power towards larger purchases like a car, or house? I imagine they would as they''re the ones that would take on most of the payment responsibility...

It doesn''t work that way for us, at least. DH will always earn more, yet we make all of our decisions together and always have.

It sounds like some people view things as 100% community property once they''re committed to each other, and some people maintain a sense of individual property. I don''t think either way is better than the other, and it''s been very interesting to read just how differently some of us handle things like this.

DH and I are a "What''s mine is ours" couple. That perspective just seemed to be natural to the both of us from the beginning, it wasn''t anything we ever had to sit down and discuss. Once we were serious about each other, it was just the way it was.

I can''t imagine having "my" money and "his" money, just as much as I would guess that some people can''t imagine having "our" money.

 

[lilyfoot]

Date: 6/15/2010 11:25:40 AM
Author: Haven

Date: 6/15/2010 10:43:49 AM
Author: elle_chris
For those that say it doesn't matter, does the higher earner have more veto power towards larger purchases like a car, or house? I imagine they would as they're the ones that would take on most of the payment responsibility...

It doesn't work that way for us, at least. DH will always earn more, yet we make all of our decisions together and always have.

It sounds like some people view things as 100% community property once they're committed to each other, and some people maintain a sense of individual property. I don't think either way is better than the other, and it's been very interesting to read just how differently some of us handle things like this.

DH and I are a 'What's mine is ours' couple. That perspective just seemed to be natural to the both of us from the beginning, it wasn't anything we ever had to sit down and discuss. Once we were serious about each other, it was just the way it was.

I can't imagine having 'my' money and 'his' money, just as much as I would guess that some people can't imagine having 'our' money.

Big ditto to Haven & RaiKai.

I make a little bit more than my husband, but I would never in a million years feel like I had more "power" over financial decision because of that. We are equals in our relationship, regardless of (what I see as) trivial things such as income. That is not an attitude I could ever fathom either of us having in our marriage.

 

[elle_chris]

The reason I asked has nothing to do with power, but with taking on a large debt that one spouse is solely responsible for regardless if the money's yours, his, or ours.

For instance, if my husband wasn't working- I wouldn't feel comfortable making a large purchase such as home (unless we can pay off most of it), knowing that the burden of the mortgage would be on me. It's just too much pressure and I'd say no regardless of whether or not we can afford it. I also hope he'd say the same. That's what I mean by "veto" power, when one person contributes alot more financially than the other, I personally think there's nothing wrong with them saying "no".

NEL- We're the same way most of the time.

eta- at the end of the day we see it as our money when it comes to big ticket items like a house or car. But for everyday mundane things (not including household bills), it is his, and mine, not ours. It works for us because we never discuss what we paid for whatever it is we purchased, as the funds come out of our separate accounts. All household bills are paid through our joint. My parents did it this way and it's always worked for them. He was a little put off at first but now loves it and he doesn't have to discuss his newest electronic gadget purchase with me. I love it because he doesn't have a say so in my jewelry purchases

 

[Shoopy]

Date: 6/15/2010 10:43:49 AM
Author: elle_chris
For those that say it doesn''t matter, does the higher earner have more veto power towards larger purchases like a car, or house? I imagine they would as they''re the ones that would take on most of the payment responsibility...

I''m the higher earner and I can tell you that my vote only counts as one

. But again, we have a joint account so *I* wouldn''t be taking on most of the payment responsiblity, we both will be taking it on.

As for him, I can tell he doesn''t speak up as often when there is something that I really want to do and he isn''t on board. But I don''t think that''s really a money thing; I think he just doesn''t want to see me unhappy.

 

[RaiKai]

Date: 6/15/2010 11:41:14 AM
Author: elle_chris

The reason I asked has nothing to do with power, but with taking on a large debt that one spouse is solely responsible for regardless if the money's yours, his, or ours.

For instance, if my husband wasn't working- I wouldn't feel comfortable making a large purchase such as home (unless we can pay off most of it), knowing that the burden of the mortgage would be on me. It's just too much pressure and I'd say no regardless of whether or not we can afford it. I also hope he'd say the same. That's what I mean by 'veto' power, when one person contributes alot more financially than the other, I personally think there's nothing wrong with them saying 'no'.

NEL- We're the same way most of the time.


eta- at the end of the day we see it as our money when it comes to big ticket items like a house or car. But for everyday mundane things (not including household bills), it is his, and mine, not ours. It works for us because we never discuss what we paid for whatever it is we purchased, as the funds come out of our separate accounts. All household bills are paid through our joint. My parents did it this way and it's always worked for them. He was a little put off at first but now loves it and he doesn't have to discuss his newest electronic gadget purchase with me. I love it because he doesn't have a say so in my jewelry purchases

Elle,

We don't "ask permission" to buy things - but we also both are rather financially responsible and trust one another and know we won't be foolish about what we buy. At the same time, we often will talk about what we are thinking of buying - not as a "asking permission" but just because we tend to be rather open books and if I am thinking about buying something new and it is on my mind, I will talk about it. We both aren't really "spur of the moment" buyers so things get talked about beforehand. We also are upfront about what things cost. That being said, I imagine some of the purchases you described would be "major purchases" for us right now due to financial circumstances so we certainly would talk about it as that is money that will affect our own budget and shared goals (i.e. vacation money, etc).

We both have individual accounts as well as joint accounts. We don't hide our individual accounts from one another or anything, and we still consider what is in them ours. We have no qualms about sharing what is in them and moving it over to the others account and so on. We don't nickel and dime one another about our expenses and purchases, but we also are quite open about our purchases.

In your example of a home, if our income could support it, and we both felt comfortable with the purchase, then we would buy it. The "greater" obligation is not on me, as we are married and thus also responsible equally for any marital debts even if the payment for it technically comes from "my income". Maybe it depends on the marriage laws where you are, but a matrimonial home belongs to both of us, and the debts we incur together during our marriage also belong to both of us. Again, I don't see it as "my income". Even when DH was not working, I was able to earn my income as DH contributed to the work at home so wonderfully and was so supportive of me during the challenges of work and so on - I was the one at work, but the income came from the efforts of us both. Just because he was not bringing a paycheck home did not mean he was not contributing to our household.

I would say that feeling "pressure" would be a valid reason to say "no" though - not out of having greater veto power - but not believing it is right choice as a couple at that time. I would imagine however you as a couple would determined that it is not the right choice for you as a couple, regardless of who had the higher income rather than you having to say something like "I don't care if you want it DH, I veto!"? I cannot imagine my own husband ever encouraging me to take on the "pressure" of buying a home if we did not BOTH feel financially able to. Big purchases are mutual decisions and we BOTH have equal input. If one of us is not going to agree to it, we won't do it - whether that is me or DH. I don't think that I have "more" veto power, and I don't think DH has "less veto" power. To say that I had MORE veto power would also mean I was making all decisions irregardless of what DH thinks as I always had the final say. That is not the case. If he disagrees, and I do agree, we don't do it. If I disagree, and he does agree, we don't do it. If we both agree, we go ahead. If we both disagree, well, obviously we don't. And if we are on the fence, we revisit it later. Again, I don't think me "making more" gives me more veto power. Our financial stability however is a factor in my (and DH's) decision making process.

 

[elrohwen]

Elle_chris, I get what you're saying. I hope to buy a home some day that we can afford on one income, so if either of us loses our job, we'll be covered. If one of us made $200k, for example, and the other made $50k, and our mortgage was not payable on a $50k salary, it would be a lot of pressure on the high earner to keep his or her job (even if they decide they hate it and want to get a $50k job). I don't necessarily think this gives the high earner more veto power - it's just something that has to be taken into consideration before buying a house or a car (or anything else involving a loan). Both partners should have veto power.

 

[anchor31]

elle - No, at least not for us. We set a budget together according to our combined means, and choose together. Not one or the other has more say, regardless of who contributes more.

haven - I''m the opposite and can''t imagine not having "my money". It''s a way for me to maintain my independance, I suppose. I enjoy not having to discuss it with DH if I want to buy something for myself. Similarly, DH likes to buy himself stuff I consider useless, and I prefer that he buys that stuff with his own money!

As long as the bills are paid, we have our emergency fund, RRSPs and bébé Jacob RESP, what he does with his money is his business.

 

[Haven]

Date: 6/15/2010 12:00:28 PM
Author: anchor31
elle - No, at least not for us. We set a budget together according to our combined means, and choose together. Not one or the other has more say, regardless of who contributes more.

haven - I''m the opposite and can''t imagine not having ''my money''. It''s a way for me to maintain my independance, I suppose. I enjoy not having to discuss it with DH if I want to buy something for myself. Similarly, DH likes to buy himself stuff I consider useless, and I prefer that he buys that stuff with his own money!

As long as the bills are paid, we have our emergency fund, RRSPs and bébé Jacob RESP, what he does with his money is his business.

I am an independent woman, and my independence has nothing to do with how I spend my money.

DH and I don''t discuss anything with each other when we want to buy things for ourselves, and we definitely don''t need to ask permission to do so. We don''t have a set limit, but we would talk to each other if we wanted to spend a significant amount of money ($500 or more, probably) on any one item. Moreso because we''re both thrifty, so spending that much on one thing would be something we would consider very carefully before doing. Otherwise, we buy what we please and we never have to tell the other what we''re buying.

For example, I went shopping for clothes a couple weeks ago and spent three or four hundred dollars. I definitely didn''t ask his permission to do so, and he didn''t ask me what I spent when I came home. (He did sit for a fashion show though, the poor guy.)

We''re both really responsible with money, AND we live far enough below our means that money is never an issue for us, anyway, so there''s nothing to talk about. It''s not like we have to count our pennies, and if someone spends a couple hundred dollars unexpectedly then we won''t be able to pay a bill. If THAT was our reality, I imagine we''d have other things to worry about than who is spending what money. I also trust my husband completely, so I know that any decision he makes regarding how to spend our money will be a good decision.

I can''t imagine equating money with power in a relationship. That just sounds controlling to me. I also can''t imagine having to ask my partner permission to spend money, either.

Elle--I understand what you''re saying regarding one spouse being solely responsible for a large amount of debt. That particular issue isn''t something we''ve run into. We purchased a home we could afford on my (smaller) income (mainly because we saved a huge amount of money for a down payment), and we purchase everything else with cash. We''re just not interested in carrying debt, so we don''t. I would have felt very uncomfortable buying a home that required we both work, or that DH keep on bringing in the amount of money he has been bringing in. Then we''d lose a lot of the freedoms we enjoy by living below our means.

 

[elle_chris]

Date: 6/15/2010 12:00:01 PM
Author: elrohwen
Elle_chris, I get what you''re saying. I hope to buy a home some day that we can afford on one income, so if either of us loses our job, we''ll be covered. If one of us made $200k, for example, and the other made $50k, and our mortgage was not payable on a $50k salary, it would be a lot of pressure on the high earner to keep his or her job (even if they decide they hate it and want to get a $50k job). I don''t necessarily think this gives the high earner more veto power - it''s just something that has to be taken into consideration before buying a house or a car (or anything else involving a loan). Both partners should have veto power.

thanks, that is what I meant. the "pressure" on the higher earner because like you said, they''re put in a position that even if they want to, they don''t have the luxury of changing jobs etc. That''s all i meant when i said they have a right to "veto" (obviously a poor choice of words on my part, sorry).

RaiKai- uh, where did i say ask persmission? All i said was how we handle it. I realize everyone''s different and like Haven said, there''s really no right or wrong. It''s whatever works for the couple. For us, having joint and separate accounts work.
I realize that others feel the same way even if the money for personal purchases was coming out of a joint account. But for me, I''m more comfortable having it come out of my own account.

 

[janinegirly]

Date: 6/15/2010 12:23:47 PM
Author: elle_chris

Date: 6/15/2010 12:00:01 PM
Author: elrohwen
Elle_chris, I get what you''re saying. I hope to buy a home some day that we can afford on one income, so if either of us loses our job, we''ll be covered. If one of us made $200k, for example, and the other made $50k, and our mortgage was not payable on a $50k salary, it would be a lot of pressure on the high earner to keep his or her job (even if they decide they hate it and want to get a $50k job). I don''t necessarily think this gives the high earner more veto power - it''s just something that has to be taken into consideration before buying a house or a car (or anything else involving a loan). Both partners should have veto power.

thanks, that is what I meant. the ''pressure'' on the higher earner because like you said, they''re put in a position that even if they want to, they don''t have the luxury of changing jobs etc. That''s all i meant when i said they have a right to ''veto'' (obviously a poor choice of words on my part, sorry).

RaiKai- uh, where did i say ask persmission? All i said was how we handle it. I realize everyone''s different and like Haven said, there''s really no right or wrong. It''s whatever works for the couple. For us, having joint and separate accounts work.
I realize that others feel the same way even if the money for personal purchases was coming out of a joint account. But for me, I''m more comfortable having it come out of my own account.

I haven''t read earlier posts but I agree and we do the same thing. We have a joint for bills/mortgage which we contribute equally to. Then we have our separate savings accounts. I personallly like it this way. If I want to splurge I don''t want to feel guilty that I''m dipping into some joint fund even though DH would never question it. I also like managing my own money--it''s my own personal style. There are no secrets, he knows what I have and vice versa.

In terms of income disparity, DH and I are around the same level but he has more in assets. So while we contribute equally to expenses he contributes more to downpayments,etc. I think this works best for us since I personally do not want to be the breadwinner and I think DH would be resentful if I was. We do have a child and I like having the option to stay home if I become fed up with work, so like elle, I agree that the breadwinner usually does not have this option and does carry the primary responsibility for keeping things afloat.

 

[RaiKai]

Date: 6/15/2010 12:23:47 PM
Author: elle_chris

Date: 6/15/2010 12:00:01 PM

Author: elrohwen

Elle_chris, I get what you're saying. I hope to buy a home some day that we can afford on one income, so if either of us loses our job, we'll be covered. If one of us made $200k, for example, and the other made $50k, and our mortgage was not payable on a $50k salary, it would be a lot of pressure on the high earner to keep his or her job (even if they decide they hate it and want to get a $50k job). I don't necessarily think this gives the high earner more veto power - it's just something that has to be taken into consideration before buying a house or a car (or anything else involving a loan). Both partners should have veto power.

thanks, that is what I meant. the 'pressure' on the higher earner because like you said, they're put in a position that even if they want to, they don't have the luxury of changing jobs etc. That's all i meant when i said they have a right to 'veto' (obviously a poor choice of words on my part, sorry).

RaiKai- uh, where did i say ask persmission? All i said was how we handle it. I realize everyone's different and like Haven said, there's really no right or wrong. It's whatever works for the couple. For us, having joint and separate accounts work.

I realize that others feel the same way even if the money for personal purchases was coming out of a joint account. But for me, I'm more comfortable having it come out of my own account.

Elle, I was not saying you DID ask for permission. I read my post and I am not sure where I did say that you did? I did say that I did NOT ask for permission, and if you interpreted that as meaning I was saying you DID, I apologize for not being clear.

What I was saying was that just because we do not do it the way you do (i.e. we do discuss purchases even if they are coming from those individual accounts) does not mean we DO so to ask for permission. Again, we have joint and separate accounts as well, and most of our "living expenses" come from the joint and "individual" expenses and purchases come from our separate accounts, but we do discuss purchases or do share what we paid for things out of those individual accounts - but not in an "asking permission way", and we may also pool what is in our individual accounts into the joint account so the other can make purchases from that as well and so on. Our individual accounts are still treated as "our money". It is complicated to explain, but what I am trying to say is that all I was doing was also saying how we handled it, and the way that we handle it, though different than yours, is similar in a lot of respects (i.e. we don't ask for "permission").

 

[sctsbride09]

It does not matter in our relationship at all. I am a stay at home wife, have been the entire time we have been together. We both prefer it this way, and there is no "my" money or "his" money, it is all joint. Im very lucky to be married to a mature, trustworthy, loving husband that realizes that I provide just as much to our household as he does, despite not having an income. Our roles are very traditional (because we both like it, Im not forced to or anything), and I take care of all household needs with the exception of mowing the lawn/trash. So of course I should have just as much "right" to our accounts/money as he does. That being said, we are both very frugal people so there has never been an issue with one person spending more or anything like that. We also discuss all major purchases together, and we both have equal "voting power".

 

[luckynumber]

way i see it, there are many ways to handle money, and different things work for different people.

for me, i couldn''t spend money freely if my FI earned a lot more than me, even if he was 100% happy with it. i would feel guilty and it woud hurt my ego, as i pride myself on my independence, and that includes financial. it would not sit well with me if FI was paying for all my luxuries because he earned so much more. he would only be paid $$$ if he worked hard for it, and i feel he should be able to spend what he legitimately earns. i feel very, very lucky that we both earn such similar amounts and live comfortably, and so dont have these issues.

i think the problems of pooling all your money arise when one person is very thriftly and the other spends a lot....

 

[MakingTheGrade]

I don''t think it matters who has what income.

For me personally, I really like the idea of having my own income or account, just because there are things I love to buy (like shinies!) that I like to buy for myself when I see something I adore. They are totally luxury purchases and I would feel bad spending DH''s money on them without asking first, and I don''t like asking, haha.

 

[icekid]

I think there is definitely something to be said for similar finances/financial goals and educational levels, in general. Does it need to be exactly the same? Certainly not, but partners at least need to be on the same page in this arena.

For now, my hubby makes a decent amount more than I do. However, when I finish my residency training in two years my income will increase by about a factor of 6 overnight. Unless my husband wins the lottery, he is not going to keep pace with that

So I''ll torment him a little bit about it (kidding!) and then we''ll both enjoy the spoils of my years and years of hard work. Plus he has been my biggest support throughout med school and residency, dealing with my crazy stress! He probably deserves it (almost) as much as I do!

 

[diamondringlover]

We make about the same amount, me a tad more then him...we have always had joint account and since we dont make alot I always keep track of what is spent...he tends to blow alot more money then I do...any large purchase we always discuss it first, which is usually around the $200 mark...it works, we get by and I sometime get a bauble here and there, lol

 

[emilyalyse]

Date: 6/13/2010 9:44:22 PM
Author:kenny
Do you think it is best when your and your SO''s income levels are similar?
Or does love make this not a factor, and if it is a factor you two have some work to do?

With us, it doesn''t matter. One year, I may make twice as much as him. The next year, he could make that much more than me. He''s a jockey, and I''m a bloodstock agent, so our incomes are largely subjective on the races he rides/wins, injury/etc., the number of accounts I get for a sale, the prices and numbers of horses that I buy/sell publicly or privately, the level to which I re-train ex-racehorses (for hunter-jumper showing), etc. etc. etc. So, really, in the long run, our incomes basically balance out.

We run all of our finances jointly anyhow. We can each purchase what we like, so long as the funds are there and the other one knows what''s going on. Percentages of income are set aside for housing, basic necessities, all of our savings accounts (separated for different items/uses), etc. etc.... anything else left over is ours to play with.

 

[PilsnPinkysMom]

Date: 6/15/2010 12:23:47 PM
Author: elle_chris

Date: 6/15/2010 12:00:01 PM

Author: elrohwen

Elle_chris, I get what you''re saying. I hope to buy a home some day that we can afford on one income, so if either of us loses our job, we''ll be covered. If one of us made $200k, for example, and the other made $50k, and our mortgage was not payable on a $50k salary, it would be a lot of pressure on the high earner to keep his or her job (even if they decide they hate it and want to get a $50k job). I don''t necessarily think this gives the high earner more veto power - it''s just something that has to be taken into consideration before buying a house or a car (or anything else involving a loan). Both partners should have veto power.

thanks, that is what I meant. the ''pressure'' on the higher earner because like you said, they''re put in a position that even if they want to, they don''t have the luxury of changing jobs etc. That''s all i meant when i said they have a right to ''veto'' (obviously a poor choice of words on my part, sorry).

Yes, pressure is definitely right. In my family, all big purchases are joint decisions, but because DH is currently the only breadwinner he sort of has final-say (though I''d like to think he''d respect my opinions, as well).

I know he felt much anxiety when we purchased our home because, quite frankly, HE pays for it all. The only things that provided him comfort were 1) having a safety net/cushion set aside 2) having job security 3) actually liking his job/not wanting to leave anytime soon.

 

[PilsnPinkysMom]

Unless there are major career changes in our future, DH will always earn double my pitiful teacher's salary.

Right now he out-earns me his whole salaries-worth, as I'm a full-time student.

After we got engaged things stopped being split 50/50. It wasn't practical: I was a broke student and DH earned a decent living. He wanted to be a provider. We have a joint checking account and we each have our own checking and savings accounts. I buy personal items (think: coffee, lunch with colleague) out of my personal checking (unless DH is in tow!), our joint spending comes out of the joint account (mortgage, dinners out, pet stuff), and I honestly don't know what DH uses his personal checking account for. All of our savings is in his savings account.

Perhaps I'm young and naive and still in a state of newlywed bliss, but I don't feel threatened that I currently rely on DH and that he is "in charge" of our finances. I know that someday very soon I will be done with grad school and ::fingers crossed:: be employed. If anything terrible happened to our coupledom, I would be in a position to provide for myself. If DH and I were not together right now, I would be living off of student loans or pathetically crawling to my parents, asking for financial assistance. I'm so thankful that he is kind, giving, and generous!

Though my only financial contribution is the occasional $200 in babysitting money (Ha... am I 14 again?), we make financial decisions together. I try to respect that he is the chief breadwinner and do avoid non-essential, frivolous spending.

 

[Asscherhalo_lover]

I make twice what my husband does, soon I may make even more. Neither of us care, it would be more of a problem if one of us worked more hours than the other. That might seem unfair to me. There''s also a good chance that he could be making more money than me someday, I still wouldn''t really care. As long as we have our time together I''m happy.

 

[waterlilly]

Date: 6/14/2010 12:08:01 AM
Author: MrsBettyBoop
My new salary is nice but it doesn''t touch DH''s... in a few years he will literally make 5X what I can. Everything is technically ours and I don''t mind spending his money

but I do like having my own money as well.

Same situation here. My husband''s salary dwarfs mine. It was VERY hard at first realizing that I simply could not pay half of the bills and have any money of my own left over - I had to get used to asking for money. Now we have a shared savings so I can just transfer money if I''m running low, but it''s still not easy and I really try to avoid dipping into our shared savings.

I''m certainly not complaining - I know I''m very fortunate, but when you''ve proudly been independent it can be a big adjustment relying on someone else''s money!

 

[wolftress]

DH used to make about 20% more than I did until I got a sizeable pay rise and promotion at the start of this year. Now there is only about 2k difference in our annual salary, which is quite unusual because he is in the lucrative IT field while I''m in a field that tends to pay peanuts because they expect job satisfaction to be payment enough! This doesn''t bother me nearly as much as DH''s poor financial sense. He has never been very good with money and will spend whatever he has.

We have a joint account that we contribute money towards every pay cheque, but we each have separate accounts for our own personal spending. DH tends to overspend and we are only now managing to clear his credit card debt. It''s really frustrating for me because I have zero debt, own my car outright, and have my own savings. I don''t like to think of money as ''my money'' or ''his money'' but I feel like I have to always have an emergency fund of ''my money'' in anticipation of a rainy day, because he is so bad at saving.

We are looking at buying a house soon but the thought of going into a mortgage with DH fills me with dread. He is genuinely trying to get better with money but it''s hard to undo 30 years of financial irresponsibility.

 

[zhuzhu]

Income level does not dictate who has more spending power or more decision power in our home.
We check with one another for anything that is more than $500 or if a purchase is occurring more often than expected (like my bling addiction HAHAHA). That is out of respect for each other, and to make budge management easier - not because we require "permissions" from another to spend. I think money should be treated with respect and we do, and people should be treated with MORE respect and we make sure of that too. That is all that matters.