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Marriage Finances: Is Your Marriage in Financial Trouble?
Successful marriages are centered around trust. For a marriage to work, spouses need to be open and honest with each other. This is true for every aspect of a relationship, from disclosing feelings, to being completely transparent about finances. Unfortunately, marriage counselors, divorce attorneys, therapists, and mediators see financial issues at the center of marital problems all too often. Discovering that your spouse is lying about money can be devastating, and once the trust in your relationship is destroyed, rebounding back can be difficult. By learning a few key signs that can indicate a financial problem in your marriage, you can save yourself emotional stress, and likely money, but identifying the problem early. Below are a few things to look out for if you suspect your spouse of financial infidelity.
They Are Secretive about Their Finances
As stated above, marriages revolve around trust. If your spouse is secretive about their finances, you likely have a problem. Both you and your spouse should have a solid understanding of how much each other earns, the amount of assets you share and own individually, and how each of you handles your finances on a daily basis. If you are both completely transparent about your money, it becomes much more difficult for either one of you to hide funds or do anything else shady. Marriage experts also say that understanding each other's financial habits will help you determine how money will be handled for the future of your marriage. If you have a problem with how your spouse manages their money, you may struggle through a life of sharing finances.
They Do Not Disclose Debts
When you get married, both you and your spouse are committing to a lifetime of living, working, and existing together. If a spouse enters a marriage with serious debts they do not disclose, the future of the relationship is at risk. Both parties need to share any debts they have collected, including debts accrued before the relationship began. Even if the spouse responsible for the debt truly intends on paying it off themselves, they need to disclose that. One spouse with serious debt could potentially hinder shared financial decisions in the future, like applying for a home or auto loan.
Reviewing both spouse's credit histories is a smart choice, and a great way to ensure both of you are moving forward together on the same page. If your spouse is hesitant to share their credit history with you, they likely have a reason to be. Perhaps they are ashamed or embarrassed about the debt they have collected, or the financial mistakes they have made, so remind them that you only want the truth so you can move forward positively. If they still resist sharing the details, you likely have a bigger issue on your hands.
They Resist Signing a Prenup
Convincing a spouse to sign a prenuptial agreement can be difficult. It may feel to them like you are making preparations for a break up right before you get married. They may feel like you do not trust them, or that you worry you will separate in the future. In reality, a prenuptial agreement provides peace of mind for both partners, and simply allows each party to delegate where they would like their assets to go post divorce. For couples entering marriage with only small assets, signing a prenuptial agreement is not too crucial. For couples on their second marriages, older couples, or couples with large amounts of assets prior to marriage, a prenup is definitely a smart idea. If your spouse is unwilling to sign a prenuptial agreement, that may be indicative of a bigger problem. Use caution, especially if you are entering your marriage with significant assets.
They Ask You to Cosign on a Loan
If your spouse does not have a strong credit score, they may ask you to cosign on a loan at some point in your relationship. This is not always indicative of a problem, however. Plenty of married couples assist each other financially, so you should not worry right off the bat if your spouse asks for help. The trouble is that people commonly agree to cosign without realizing that they are now responsible for paying back the debt. Even if you and your spouse divorce, you could still be found liable for paying back the loan. If your spouse does not handle money responsibly, and you do not trust that they will be able to pay back the debt, avoid co-signing.
If you do agree to cosign on a loan, be sure to get everything in writing. Have your spouse sign a contract stating the terms of the deal and a schedule for paying the debt off. Spouses often co-sign on a loan without thinking of the future consequences. If your spouse is unable to pay back the loan, and you are left responsible for the debt, your relationship will likely be changed forever.
Marriage is a partnership, so you should expect some level of supporting each other financially. If you notice anything suspicious, however, you may have a larger problem on your hands. It is one thing to help support each other, and another to be lied to or left with serious debt you did not accrue. Unfortunately, couples often discover financial secrets their spouse has been keeping long after the damage is done, and the dynamic of their relationship changes forever. The best strategy is being open and upfront with each other from the beginning.
If money issues are deteriorating your marriage, it may be time to speak to a divorce attorney. The qualified DuPage county divorce attorneys at Stock, Carlson & Asso. LLC, are available to assist you today. Call 630-665-2500 to schedule a consultation with an attorney to learn more about your legal options and the services we provide.
Estate Planning and Medicaid Options
Many Americans go through their adult life working hard and saving money with the goal to enjoy a comfortable retirement. Unfortunately, at some point in their senior years, it becomes too difficult for many people to live at home—a decision is ultimately made that that living in a nursing home is the safest and best option. However, nursing homes are expensive and Medicaid will only cover costs for people who all into the low-income category.
For those seniors who worked hard and saved their money, nursing home costs can quickly annihilate savings. This can be especially troubling when for elderly couples when one spouse is still healthy and is able to live on his or her own. Still, what will that spouse use to live on if nursing home costs for the other spouse is eating up all their money?
In order for a person to qualify for Medicare, individuals cannot have more than $2,000 in countable assets. These assets include:
Medicare to Now Cover End-of-Life Care Sessions
On January 1, 2016, Medicare will begin covering the medical costs for patients who wish to participate in end-of-life counseling sessions. Many medical personnel already discuss these subjects with patients, however, they do not receive any reimbursement.
Under the new coverage, physicians and nurse practitioners, as well as other health care providers, will now receive payment for the time they spend discussing end-of-life options with patients.
A report issued in 2014 by the Institute of Medicine, "Dying in America," touted the importance of providing patients with the opportunity to discuss what life saving measures they do or do not want taken in the event that decision has to be made, as well as other end-of-life care options. The report found that many patients suffer through invasive treatments instead of receiving more comfort care, mainly because they never have end-of-life care discussions with their physicians, or even their families.
Common Financial Divorce Mistakes That Could Cost You
Divorce is a stressful, emotional time, and simply getting through the process is a challenge on it's own. Financial planning for your future may be the last thing on your mind, but a little preparation during your divorce process can make a huge difference in your success as a single person. Unfortunately, emotions can cloud our judgement, and many people going through divorce make costly mistakes, often without realizing it. Here are three financial divorce mistakes that could seriously cost you in the future.
You Lack Financial Understanding
If you were not a part of your household or business finances before your divorce, it is time to start studying. Too many people head into divorce without even a basic understanding of their family's finances. How can you fight for what is fairly yours, or determine if you got a fair settlement, without knowing what was there to begin with.
The Basics of Confidentiality Agreements
If you are running a business and have a product or service that isn't offered elsewhere or is relatively unique, chances are you have considered a confidentially agreement. All businesses operating in an industry in which secret formulas or recipes could compromise the ability of the business to make a profit should have a confidentiality agreement in place with employees. It is best that this agreement is considered and signed before an employee begins work in earnest — any hesitation can lead to murky legal waters regarding the divulgence of company-specific products or services.
The reason that confidentiality agreements need to exist separation from patents or copyrights is because they, in large part, protect trade secrets. The difference between trade secrets and copyrighted products or processes is that a trade secret is considered intellectual property. Confidentiality agreements are implemented in addition to the protections afforded by copyright infringement laws, however, because trade secrets are intellectual property that is considered non-public. Laws regarding intellectual property are complicated to enforce and often confusing for both parties involved. Confidentiality agreements allow for some of this complication to be ironed out.
The Benefits of 529 Savings Plan for Estate Planning
In light of the cost of college tuition and other associated expenses, it is never too early to start your children's or grandchildren's college fund. In fact, one option for savings—529 college savings plans—can actually offer estate planning benefits, as well.
The 529 savings plan debuted in 1996 as a way to set up an educational savings plan without having to pay federal taxes on any interest that is earned by the account. The plan gets its name from Section 529 of the IRS tax code.
There are two different types of plans. The first is the college savings plan. Like other types of financial savings plans, the funds that are deposited in this type of account are typically invested in bond mutual funds, stock mutual funds, money market funds, and other portfolio investments. These funds can later be used at any college or university. It is important to note that these funds are not federally insured or guaranteed by the state.
Holiday Tips for Divorced Co-Parents
If you are a co-parent, you may be nervous about the upcoming holiday season. Will you and your ex be able to get along? Will you be alright without the kids on Christmas this year? Will the children be upset that both parents are not spending to holidays together with them? The list of worries can be large and overwhelming. Co-parenting after divorce is challenging enough, so adding the stress and expectations of holidays into the mix can be tough. As the holidays arrive, here are a few tips that can help you prepare for handling holidays as a co-parent.
Review Your Agreed upon Child Plan
During your divorce, you and your ex likely mapped out who will get to be with the children over holidays. With the holidays quickly approaching, now is a good time to review your agreed upon parenting plan, and figure out where the kids are supposed to be. Once you have reviewed your agreement, make a plan. Create a holiday schedule that lays out which days and times the kids are with each parent. A clear schedule will help relieve any anxiety or tension, for both you and your children, and can help make transitions between households run more smoothly. Your children may be wondering where they will be and when, so being able to show them a holiday schedule will provide them with peace of mind.
Are Intra-Family Loans a Smart Choice?
It is not uncommon for parents to provide financial assistance to their adult children for major purchases, such as the purchase of a new home. Moreover, the amount lent to an adult child may be dependent on his or her financial circumstances. However, one option that many families are considering is intra-family loans.
The rising popularity of these loans may come from the lack of higher-interest bearing savings accounts that most financial institutions offer. For parents whose money would be sitting in an account that is only earning approximately 1.5 percent interest, the lending of funds to be used as a mortgage to their adult child, and the earning of 4 percent interest, is a much more attractive proposition.
For an adult child, an intra-family loan can offer lower interest rates than what the lending institutions offer. Utilizing an intra-family loans can also help to avoid the often large down payments that lending institutions additionally require before they approve a mortgage. An adult child is still able to claim the interest he or she is paying to their parents on their income tax, as well. In addition, this interest "stays in the family"—either spent by the parents or it is eventually inherited by the adult child. None of it goes to a bank or mortgage company like traditional mortgage interest does.
Signs of Divorce: Are You Unknowingly Hurting Your Marriage?
Most people take their marriage vows extremely seriously. When two people say "I do," they likely truly mean it, and intend on staying together for the rest of their lives. As we all know, however, that is not a realistic outcome for every marriage. Relationships turn sour, people change, and many couples find themselves having to choose between their happiness and their marriage.
Most people, however, do not simply decide on getting divorced one day out of the blue. It is usually a culmination of many issues that all build up to an unbearable point where divorce seems like the only option. Obviously, cheating and lying are two surefire signs your marriage is in crisis, but did you know that you and your partner may be undermining your marriage without even knowing it? Here are a few ways you may be weakening your marriage unknowingly.
Recent Changes for Estate Tax Returns Announced
A recent statute passed by Congress and signed by the President, the Surface Transportation and Veterans Health Care Choice Improvement Act of 2015, contains a provision concerning estates which are required to file estate tax returns and imposes new reporting requirements. The law went into effect on July 1 and it only applies to estate tax returns due on or after July 31.
According to the new law, the estate tax return must report, separately, to the IRS, and to each individual beneficiary of the estate, the estate tax value of any property the beneficiary is to receive. These statements must be provided to the IRS and any estate beneficiaries within 30 days of the estate tax return due date. For example, if an estate has a return due on December 1, the reporting must be provided by December 31.
The responsibility for this reporting falls to the executor of the estate. Information which should be provided in the statement includes the value of each property which is being reported, as well as any other information the IRS may require because of the new law.
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