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You can make $20 million a year, but that doesn’t mean you don’t need to make a budget and stick to it.
Imagine being married and concerned that your wife is spending too much money instead of saving up to buy a house.
Would you try to get her to stick to a budget or ignore her spending habits?
See why the wealthy man in this story is concerned about his family’s future.
My wife and I make about 400k per year. She makes $220k plus some bonus, I make $180k plus minimal other income.
Our after-tax income is $19k monthly plus another 19k throughout the year, plus another 10-20k in spring.
Yet the two still encounter financial strife.
We live in the DC area with 2 kids in public schools. No significant debt (other than 20k credit card debt incurred by my wife).
Every month we spend more than we make.
In September so far we spent 20k (without any vacations or major purchases). And by “we” I meant mostly my wife.
His wife spends a lot of money on things that aren’t essential.
Normally, I would say that she is entitled to spend on whatever she wants. But the problem is that we have fixed obligation, such as rent, after school activities, food, utilities.
She contributes about 25% of those, and then she says she doesn’t have any money for the rest.
I end up paying for 75% of our mandatory expenses. She spends her money on restaurants, shopping for clothes, and other things.
Saving up for a home takes commitment.
So instead of saving money, we are currently depleting our savings.
Those savings were supposed to be for a down payment for a house.
I insist that we should stick to a budget of about $18k per month and control our (her) discretionary spending.
She doesn’t agree with him and won’t budget herself.
She says that I am controlling and suffocating, and there is no joy in life if she can’t freely spend. She says that we can use the savings to cover the bills.
Rent is $6000 (she pays half) Utilities and other monthly fees $1000 (she pays 0) Groceries are 1700 (I mostly pay for those).
Restaurants are $1200 (mostly her) Child activities $2600 (I mostly pay) Amazon shopping $1000 (she shops, I pay).
Child care 995 (I pay) Cleaning 550 (I pay) Auto payment 450 (I pay) Credit card interest fees $500 (she pays) Pets $900 (I mostly pay).
What do you think?
He wants to stick to a budget, but she doesn’t. Maybe buying a home isn’t important to her. They need to get on the same page about their financial goals.
Here is what folks are saying on Reddit.
It’s not romantic, but it’s important.
Exactly. I don’t get sharing all money in one account.
Good idea. This will be helpful.
I thought gambling and drugs.
It’s a very different way of life.
Spending more than you earn is never a good idea.
If you thought that was an interesting story, check this one out about a man who created a points system for his inheritance, and a family friend ends up getting almost all of it.