YAY! My first deployment 'money fight' with wife - over TSP!

Sort by newest Sort by date
T

TSP@ti2de

New member
imported post

Rough night last night. I'm less than 48 hours from coming home on leave for a couple weeks, and made the mistake of bringing up my new financial priorities...

I was weaving through the previous thread, trying to figure out how I too can 'max' at $15K ASAP beginning this October, in addition to front-loading that10% savings plan.

Man, I shouldn'ta said anything... :shock:My wifegot all unglued, saying thatI deviated from my original intent of paying off the house (I will still have plenty of money to do this, I think)

I ran some 'optimistic' 30-year 8, 10, and 12% returns, and that's some HEFTY PAYBACK for not having to do anything else... the power of compounding... WOW!

$139,759.12

$237,946.39

$401,248.96

Now I'm trying to figure out how to convince her that this is righteous... Any takers?
 
imported post

Hello TSP---

A house is also an excellent investment. In the last ten years. I'm surethat home value has went up faster and higher than a TSP investment. I paid$68,000 for my home in 1994. Itis now worth$119,000. Assuming that the housing bubble does'nt burst, I haveexcellent capital gains in my home. This appears to be the norm across the country.
 
imported post

Hi Captain,

Unfortunately you have just encountered one of the lesser know realties of life, and that is it is a proven fact that women make better investors. They are more conservative and less willing to take on risk - as a class of investor. Maybe it's time to delegate some responsibility and let her handle some of that excess change you will have around. She just might surprise you and get some satisfaction at the same time. Encourage her to sock it away in her own deferred comp plan with the new employer. She'll do just fine. Take care.

Dennis
 
imported post

Yes---You do lose a tax shelter. But you also loose a mortgage payment:).

You could always buy a second house after the first one is paid off.

BTW, you still have county property tax in some states that are a tax deduction.
 
imported post

Let me help you out on this from experience....and the experience of others.

If someone takes offense to this well......To bad!

Most women in a marriage don't understand anything other than the money that they have now.Talking about future money is just a pipe dream for us boys and the market is a rip-off, we can't afford it, your throwing money away, you will lose it all then what? Sound familuar?

I work on a Army Base and I hear your problem all the time.....I went through it too. First, you will aways have bills! You will always have someone you owe money too that the nature of the beast. You need to pay yourself and your family first.

This is how you fix it....and it works.

1. Just do it! Start out with the minumim matching % that TSP offers. Otherwise you arejust cheating yourself.

2.Slowly raise your TSP % over a period of time. If you pay off an allotment raise your TSP %.Pay a bill...Raise your TSP %. You get the point.

3. THE MOST IMPORTANT RULE! Don't discuss it. Don't tell her. The money will be worth the future arguement. My wife found out several years later and was pissed....Then I showed her the balance. She has never said a word since and asks me how it's doing now.They will find out it's not a pipe dream.

I've have had a hand full of guys come to me and say thanks.....Because it works!

Chances are you will never convince her......Just do it or you will be a 70 year old man saying, "Welcome to wal-mart do you need a cart?".:*
 
imported post

Let's play the devil's advocate: what if the wife was the one to go out there and just do it and not tell her husband until later? What would be his reaction if he thinks she has taken money away from paying the bills, or for something they had already planned for in the future? What if they have high credit card payments hanging over their heads, or a big house mortgage that he's trying to pay off. I can see the guy thinking that the wife is high maintenance on him and not working with him to help reduce their expenses.
 
imported post

TSP@ti2de wrote:
Rough night last night. I'm less than 48 hours from coming home on leave for a couple weeks, and made the mistake of bringing up my new financial priorities...

I was weaving through the previous thread, trying to figure out how I too can 'max' at $15K ASAP beginning this October, in addition to front-loading that10% savings plan.

Man, I shouldn'ta said anything... :shock:My wifegot all unglued, saying thatI deviated from my original intent of paying off the house (I will still have plenty of money to do this, I think)

I ran some 'optimistic' 30-year 8, 10, and 12% returns, and that's some HEFTY PAYBACK for not having to do anything else... the power of compounding... WOW!

$139,759.12

$237,946.39

$401,248.96

Now I'm trying to figure out how to convince her that this is righteous... Any takers?
Click to expand...
perhaps u could talk her into a "dream house" in order to stay leveraged in re. with these low rates paying off a home loanmeans " i admit i can not earn 5.5% in anything else" to me.

maxing the tsp one would think is a no brainer, but in the end if she ain't happy u ain't happy:shock:
 
imported post

TSP@ti2de wrote:
Rough night last night. I'm less than 48 hours from coming home on leave for a couple weeks, and made the mistake of bringing up my new financial priorities...
... :shock:My wifegot all unglued, saying thatI deviated from my original intent of paying off the house (I will still have plenty of money to do this, I think)
Now I'm trying to figure out how to convince her that this is righteous... Any takers?
Click to expand...
#1 -maybe you could start by examing your marriage realtionship. Consciously, or unconsciously, you have told us these are Your New financial priorities.

#2 - Also you might think on whether you have demonstrated your trustworthiness; whether there has been times of deviating from your word, intents before.

#3 - As far as righteousness, what are your guidelines for righteousness? How do you define this word?

#4 - obviously you need to sit down, clear the air, show what you feel is the right directionfor your monies; listen & consider what your partner in life has to say. Pros & cons for Both sides - Then call Larry Burkett's Money Matters/Crown Ministries for their pamphlets/tapes/bks on financial solidarity w/in the family.

angel12.jpg
grandma
 
imported post

mutton$ wrote:
Let's play the devil's advocate: what if the wife was the one to go out there and just do it and not tell her husband until later? What would be his reaction if he thinks she has taken money away from paying the bills, or for something they had already planned for in the future? What if they have high credit card payments hanging over their heads, or a big house mortgage that he's trying to pay off. I can see the guy thinking that the wife is high maintenance on him and not working with him to help reduce their expenses.
Click to expand...


Devil's advocate is taking the opposite view & developing it from there. Your scenario is that the wife is going out and spendthrifting - leaving them deep in debt, making her a liability to this fellow. A better opposite would be, what if sheis already placing money onto the mortgage principal & onto other debts, & now he is changing his directions w/o presenting his case first. However, paying off the mortgage was no longer a priority for him-, so your comments are irrelevant to what you had intended to communicate - unless you did want to show the wife as a hindrance to him & his goals in life.

This young man has stated he did bring up to her he wanted to change directions - her reaction would naturally be one of fear, afterall how much of the time is she left by herself to do all the Managing, anyway? When he overcomes the natural tendency to say what He is going to do, and presents it as something he wants to discuss as a potential, they should get it okay - provided, of course, there is this mutual trust already in their histories.
angel12.jpg
grandma

(And in actuality,the Cpt has no debt except for his house, he is already maxing different places w/his paychecks, he is already funding forthe 2 kids' college days, and she has a good job, too. The collision course ends at the kitchen/dining table w/theirfiles/papers/cards laid out in the open.)
 
imported post

Hmmm.... The numbers don't lie. The problem here, I think is communication. Talking to someone about a plan is different when you actually show her a plan. Again, I will say it again, the numbers will not lie. I like the way she think which is to remind you not to deviate from the plan. I believe that she is telling you this because she understood that plan and how it will both benefit you. Your job is to convey to her, how this new plan of your is even better than the original plan. How do you do that? Put it in writing. You said that you've been running the number games. Show that to her and explain that it will not only makes sense to deviate from the original plan but it is more beneficial for both of you in the long run.

Some will say that having a mortgage is better for it offset taxes. Others will say that having no mortgage payment is better because you can save and take those interest pmt and invest it somewhere. It really all depends on an individuals. For me, I need to have a mortgage, without it i'd be giving my money to Uncle Sam instead.

You must show her two plans when you get home. One is the original plan that she knows and the other is the plan that you came up with. Bottom line,your new plan must be able to provide significantly more return + security (for her well being sake).Just like what others said, if she's happy, then you will be happy.

As for me, i'm the "MAN of the House" and what I say goes. OK, I have to go now, I still havetwo loads of clothes to wash and give the kids a bath... I did tell her, i'd do itand there is nothing she can do about it...:P
 
imported post

Yes, Grandma, I was using the devil advocate as a theory - not specifics. Only as a thinking tool. Since we haven't heard anymore comments from the originator, I'm curious as to what his opinion is of what he's read so far. Now let me get specific: The fury of a woman makes Ivan look tame! Been there, done that, and have a holey Tshirt to show for it. What has happened with this gent is deja vu. I pulled the same thing he did (only once)! Sure, I made money, but the silent treatment wasn't worth it. The only way I recovered from that mistake was by squirming my way back in with tickets for a cruise. Communicate, communicate, communicate. I cannot emphasize it enough. You better believe now everything is put down in writing and totally discussed.That's the only way to go in my book.
 
imported post

Paying off a mortgage isn't always the best thing to do. For one thing it means you have assumed all risk concerning the property. Down here, where my property could be erased in a moment by an Ivan, I like the idea ofsomeone else taking that bite.I have lived in this house for six years, and my mortgage balance has increased by 15% since then: the house is paying for its own upkeep through negative amortization.Yet over time my debt-to-equity ratio has declined steeply, now at 1 to 3 since the property value is about 4X what we paid for it. This is leverage.

That said, I personally would not make any big moves without consulting. One thing you might do, is make your wife the beneficiary of the TSP account. *smile*

Dave
 
imported post

Dave M wrote:
Paying off a mortgage isn't always the best thing to do. For one thing it means you have assumed all risk concerning the property. Down here, where my property could be erased in a moment by an Ivan, I like the idea ofsomeone else taking that bite.I have lived in this house for six years, and my mortgage balance has increased by 15% since then: the house is paying for its own upkeep through negative amortization.Yet over time my debt-to-equity ratio has declined steeply, now at 1 to 3 since the property value is about 4X what we paid for it. This is leverage.

That said, I personally would not make any big moves without consulting. One thing you might do, is make your wife the beneficiary of the TSP account. *smile*

Dave
Click to expand...
Hmmm... Isn't this the reason why there is home insurance? I assume that they will keep this. If a hurricane comes in and their house gets blown away, they are still liable to pay the bank for what they owed. This is the reason why the bank will insist that you have a home insurance when you make a home mortgage.

Now, is it better to pay off their mortgage early? They only owe 63k with 15 year amortized (don't know the interest rate so for the sake of discussion lets say it is 5%). Total interest pmt they will make is under 27k for the life of the mortgage. Keeping this mortgage alive does not help them tax wise since the deduction they get out of it is very small. Paying it off might be a good idea. However, we can also argue since they are not really losing alot by not paying the mortgage right away (27K within 15years is not alot to me but it could be for some people), maxing TSP and 401K and ROTH IRA might be a better deal. His wife just got a job that pays 67K.Socking away 15K of that will save them $3,105.00 in taxes. Right now she is only socking away 10% so she is underfunding her 401k and not maxing out the tax deductible that she could get. Right now, she is only saving $1,462.00.

When he gets back from deployment, he also needs to max out his TSA TSP to 15k. Right now he is putting in 15% of his pay. His monthly mortgage of less than $500.00 will also help to lower down their income(even if it is little).

Now lets say they delay and wait until they pay off the home mortgage. Lets say it will take them 2 years to pay it off. They were able to save $15,258 of the interest pmt for year 5 to year 15. However, we all know that setting aside 15k today vs. 2 years down the line and with the help of compounding interest and reinvesting without being taxed, by the time they retire (60 years old) the savings lost could be as high as $215,000.00. Please see excel worksheet. I assumed that they are 35 years old...
 
imported post

hey, P - when I tried to access the spreadsheet, I got this :(I deleted all of the stuff after the boxes, it took up nearly a whole page -) Is this my computer glitch?

Warning: Cannot modify header information - headers already sent by (output started at /usr/www/virtual/gambler726/www.tsptalk.com/mb/bb2html.php:715) in /usr/www/virtual/gambler726/www.tsptalk.com/mb/attachment.php on line 93

Warning: Cannot modify header information - headers already sent by (output started at /usr/www/virtual/gambler726/www.tsptalk.com/mb/bb2html.php:715) in /usr/www/virtual/gambler726/www.tsptalk.com/mb/attachment.php on line 109
ÐÏࡱá>þÿ !þÿÿÿþÿÿÿ ó'ÍÁ@á°Áâ\p reolito.jao B°
 
imported post

I tried it again and it is doing the same. I opened it with my computer just to check and it was fine. I put it in a diskette and went to another computer and again it was fine. I think something in the system here is messing it up.

Tom,,,, HELP!!!!
 
You must log in or register to reply here.
Back
Top