I’ve got a friend who is having major trouble with her husband concerning how the household finances should be run. She wants to track income and expenses more closely. He is positively opposed to it, as (this is what he has actually said) he makes “the big bucks” and “shouldn’t have to worry” about things like this.
He does in fact make the big bucks. But of course that does not mean he “shouldn’t have to worry” about making sure you’re, you know, spending less than you make and setting yourself up for a good retirement etc.
In the background is a history of compulsive, addictive behavior on his part, and a tendency to treat her concerns as a kind of nagging.
(They have a more solid relationship than the impression you may have from the above–the above is just one aspect of the relationship, and relationships are multifaceted.(
Anyway, I’m wondering if there are, what, accountants? Financial planners? Something? Who will take a look at a household’s finances, where money goes, etc, and deliver some kind of report that objectively explains whether the household is managing its money acceptably, and if not, why not.
Or is there maybe a kind of counseling designed specifically for this kind of situation?
I mentioned that instead of going to him herself again after he recently roundly rejected her proposal that they use the software You Need a Budget, it would be awesome if some neutral third party could come in and take a look and set them (probably the HE part of them) straight about what needs to happen.
Are there people that do this? What are they called? What’s the standard term for a service like this?
I would think that “accountant” or “financial planner” should cover the territory.
A bigger question might be: Is this a small time assignment? As in, too small for many professionals to want to bother with? If part of the problem is planning for retirement, there are certainly “financial planners” who offer that specialized service. (Hint: Go to your local Senior Center and look at all the financial planning advertisements on the bulletin board there. Or, if your community has a weekly newsletter-type publication aimed at seniors (for example, Fresno does), look at the ads there.
Compare trying to hire a carpenter to come to your house to repair some petty thing, like replace a broken cabinet door. I had to deal with that once, and even the carpenters who advertised “no job too small!!!” couldn’t be bothered.
IMO that’s the best course of action. They have a disagreement and he doesn’t want to really hear her side or compromise. No matter what the thing is, the disagreement is the root problem. Most financial planners make you do the work that you he doesn’t want to do in the first place. Then they review that information to help you plan. The people that come to mind who will force the issue are called divorce lawyers and family court judges.
In any case, if you had someone look into their finances, it wouldn’t work without his cooperation. And if he was willing to cooperate, they probably wouldn’t need the service.
If the relationship is not in trouble then why get involved? If she can’t fix her issues with her husbands budgetary habits how are you and/or a financial adviser going to help?
I’d suggest to continue to be her friend and listen to her complaints and nod wisely at the appropriate times…
For an auditor or finance person to do the work, they would have to start with accurate records of their current spending & earning. Doesn’t sound like they have that, especially on the spending side. And it doesn’t sound like he would be willing to help in creating that.
So work on the relationship part – they might possibly have some success there.
I expect that the finances will eventually be worked out by auditors assigned by the divorce court.
I mean, that’d just be bank statements and credit card statements. Not seeing the difficulty there.
But I did find this org called the Financial Therapy Association that mentions couples counseling on its website, so I mentioned that to her. Job done.
They could get an accountant/planner but the first thing that person is going to do is write down how much money is coming in and going out each month, there’s no reason she can’t do that herself. Quicken works great, but so does a pad of paper. Some people just can’t see what’s going on when it’s scattered between a bank statement and 6 credit card bills. Start this month, two columns, Income and Expense, in the income write down all the money that comes in (duh) and in the expense column write down every thing that goes out, every time a credit card is swiped, every check that’s written, every time cash is given to someone etc. At the end of the month it’ll be easy to say 'honey, we brought in $5,000 last month and spent 6k, here’s all the expenditures, if we can trim out $1500 a month, we’ll be ahead of the game.
At this stage (assume she hasn’t tried this on her own yet) the only real reason to bring in an accountant is to have someone else break the bad news to him, someone with “authority” because she’s worried that he won’t believe/listen to her. But like I said, it doesn’t take a CPA to add up all the outgoing money and subtract it from the incoming and see if the answer is negative or positive.
Now, don’t get me wrong, if they’ve got millions, a financial planner may still be in their best interest, they’ll get them [back] on track and help them manage their money, but if they just need a nudge in the right direction, she needs to decide if it’s worth it. Will he listen to another person? Will that just be throwing good money after bad? I don’t know.
If he’s fighting it this hard, one has to wonder if the addictive behaviors are just a thing of the past. It sounds like he might be afraid that someone will discover something. I mean, come on, YNAB is simple and he either doesn’t respect his wife enough to work with her feelings too or the guy is hiding something. Or maybe he’s just afraid that the cuffs are going to be put on him and someone will be telling him what to do, like maybe the numbers if nothing else. Money is finite, even for guys making the “big bucks”. I agree with the counseling recommendation, and I hope he isn’t hiding something that he knows would be turned up if someone looked at the money trail too closely.
Then it’s not a terrible idea, but there’s also a good chance he’s not going to listen to that person either and it’s just going to be a waste of money. She may just be in for more ‘we have plenty of money, I don’t need anyone telling me what I can and can’t spend money on’ arguments.
I’m hesitant to suggest he’s hiding something but I think a lot of people make enough money that they don’t have to worry…for a long time, but then don’t realize when they slowly start spending beyond their means. So, if he’s bringing in, say, a million a year, that’s about 60k a month after taxes. And for a while everything was great, buy a boat, who cares, buy another car, great live it up. Second house, he can pay for it in cash, but over the years the toys need maintenance and he’s been betting on the horses and going to Vegas once a month instead of once a year and since he doesn’t look at the bills (or he just pays them without paying close attention), he doesn’t realize that he’s spending 50k a month doing all this and his savings is starting to slow down or worse, he’s been dipping into in some months.
If he’s getting older, it just takes a good stock market crash to insure he’s not going to retire. Ask all the 70 year olds that tried to retire 5 years ago.
Is he positively opposed to letting a planner run the finances? Will that person be able to change his mind? Does the wife actually have any idea what’s going on with the money or is she just guessing? I mean, is it possible that he’s out living it up but he’s still got plenty of money?
I guess some of this depends on what the actual situation is.
She could mention that it’s not about making the big bucks, it’s about keeping the big bucks.
Or she could have a fun weekend shopping, run up several thousand on the credit card, and hand him the bill - “You make the big bucks, I shouldn’t have to worry about things like this”.
It could be that there’s no real financial problem. Why does she want to track expenses? That’s boring and tedious. I get the sense that she might be more of a saver and feels uncomfortable not having a financial plan. I feel she wants a budget so that she has a better sense of control rather than they need to save more. She should be able to get an overall sense of income and expenses by looking back at a few bank statements.
Does she work? I could see her worrying about this if she doesn’t work since she may feel dependent on his salary.
Exactly, she doesn’t need his permission, just get a pen and paper and write it all down. I understand that she would be going behind his back, but on the one hand she might find out that everything is actually just fine and she would end up with some peace of mind (wow, he’s actually only spending 20% of his income). OTOH, if she can’t bring herself to take all the monthly bills and and add them up, subtract them from what he brings home in a month because he said ‘don’t do that’, there’s more going on.
My vote is for her just running the numbers over the next few months (behind his back), and hopefully being able to get some peace of mind because things are actually fine, but if they’re not she can boil it all down to a simple number. That way it’s not a knock down drag out argument about how they need to talk about this or hire a that or cut down here or there, she can just say “John, I looked at all the bills for the past few months, we’re spending 10,000 dollars a month more than you’re bringing in, where the money is going to come from if we have to tap into the retirement/stocks/whatever accounts, I don’t know” and go from there, but at least she’ll have a solid number/facts to work with, it makes it harder for him to skirt the issue.