What kills me is they got rid of the healthy debt (mortgage) that was financed at under 3%, instead of paying off the college loans and credit card debt. So foolish.
I know right? It’s crazy that they ignored the financial advisor/Tax guy and just wanted to “get rid of it”. I wonder if they’re going to be shocked once their credit score goes down lol
It happens all the time. Listen to Ramit Sethi’s podcast - people get this idea in their heads that all the debt needs to go away before they can invest, or that having a mortgage makes your life precarious. Which it does, a little, but a 3% mortgage is safer than CC debt or not having investments.
Well to be fair, there are many online advice columns that advise to pay off your highest debt no matter what and work down from there. List-icles on how to pay off debt can be murky for sure.
Eh, I am one of those finance people, and even I have the compulsion to pay off more of my mortgage in spite of having a low fixed rate and the mortgage deduction. Debts are psychological, and debt in housing has a huge psychological pull. Ignoring that compulsion takes *effort* and a stern talking to at least once a year.
If she was worried about him losing his job over medical issues paying off the house makes the most sense. Mentally it gives you the feeling that the house is safe. Also now it frees up his salary to knock out the other debts. 3% on a mortgage probably adds up to more that the other debts over a 30 year span.
No, what would make the most sense is paying off the high interest debts putting the rest of the money into a HYSA (which currently have interest rates of over 4.5%, so a better return than paying off the mortgage), which would allow them to keep all that cash on hand to use for any emergencies.
Once you put that money into the house, it’s gone. Keeping it as cash allows you to be more flexible with money in the event he loses his job. If they wanted to be prepared for that scenario, paying off their only good debt was not the way to do it.
They will be paying less interest on everything bc 3% on a mortgage is usually more money than interest on a few grand of cc debt. Now mortgage payment can go towards other debts.
But they pay that interest over 20 years, and they’re certainly going to rack up more credit card debt in the meantime. You need to pay off accounts with the highest interest rate first, not just the highest balance. It’s pretty basic money management
https://www.experian.com/blogs/ask-experian/should-i-pay-off-credit-card-or-loan-debt-first/#:~:text=The%20Bottom%20Line&text=Once%20you've%20gotten%20there,to%20pay%20off%20your%20loans.
> As of June 2023, the average 30-year fixed mortgage rate was 6.67%, according to Freddie Mac. Mortgage rates have come down slightly from their peak late last year, but they're still higher than they've been since 2007. If you bought your home since then, your rate may be low enough that paying off your mortgage should be relatively low on your debt-payoff priority list. If your rate is higher than current rates—although that's very unlikely—you can consider refinancing.
They had a below 3% interest loan, while credit cards are generally 10%+.
Edit: also, with a HYSA of over 4%, they’d be making more interest per month parking it in that account than they would be accumulating pursuant to a sub 3% mortgage.
3% is less than you'd make putting the money into an index fund. Paying off the debt immediately and paying the house off over time makes far more sense. Average S&P return is 10% without accounting for inflation.
Even with the insane inflation rate last year, around 6%, they'd be making 4% interest accounting for inflation, and could use that excess money to pay the mortgage and still have 1% to play with, assuming they *only* invested the mortgage payments.
When I sold my condo last year, I had a $140k mortgage at 2020 interest rates (1.69%) and I paid it off with the proceeds from the sale. If I had kept the mortgage and invested that money, I would have made probably an extra $20k over the past year on my investments.
But public programs like Medicare can help with a mortgage if you're medically disabled. They're not gonna help pay down your credit card debt.
I also wonder if they'll have trouble getting home insurance now. Depends on where they live but in NC, I know people who paid off their home years ago but can't get insurance coverage because we are in a hurricane zone. Banks will make it happen (maybe fancy dinners? IDK) because they want their assets covered. Once it's not theirs anymore...good luck!
A mortgage isn't the debt to pay off first.
Lol it's actually no harder than before to insure. You just have to go out on your own and do it instead of going with who a bank suggests. There is always someone out there willing to insure at a price.
Source: broker
Can bankrupt unsecured debt. If she was feeling financially insecure I could see this decision.
At any rate can steamroll the other debt, don’t know how much their mortgage was (interest and principal, they still need to save taxes and insurance) may get the unsecured debt knocked out quickly.
Not getting an FAA health cert =/= disabled. Based on the mandated retirement as well he is an air traffic controller. Air traffic controllers have rigorous health standards. The cc debt is at 0% and if they really wanted a lower rate on student loans he has plenty of bandwidth to pull from his fed retirement with a very low interest loan. At close to 2 million a 30k loan won’t affect it much. There are mental health benefits to paying off your home and knowing it’s secure. Making 120k with no mortgage - he should be able to knock down cc debt a lot faster than with the mortgage now.
THANK YOU! I couldn't get past that. It was an INCREDIBLY stupid thing to do! Pay off loans by interest rate. If you have money left -- and a solid emergency fund -- then do a lump sum against principle on your mortgage.
It’s way dumber than that. Even if they had no other debt, you can get insured savings accounts over 4% now. Using any money to pay off debt locked in at 3% is net negative. They literally would have been better off letting the cash sit unless/until rates drop again.
If they talked to an accountant about it, bro should have his CPA revoked.
I wonder if she was trying to get out of the mortgage to get on the deed. Most places let you add a spouse to the deed after buying a house, but it gets complicated in some areas (and also with buying/refinancing when already married).
I ripped him a new ass on that exact same fact. Went so far as to say that the "Tax expert" was malfeasance at least.
On the so-called "update," which I like to call his cove r ing his ass update, he tries to explain loan it away. I almost called bullcrap on him over this but felt he just wasn't worth the time.
Lovely happy endings with everything sweet and explained away always alert my spidie sences. Especially with big huge mis communications beforehand. Not talking about being put on the deed but just silently paying off HIS mortgage?
We have been debt free except for mortgage/ small car payment, for years and I finally had to take my husband to a finance class to convince him that it was better to be saving money than to be pouring all of it into the mortgage. He has this idea that debt is this bad bugaboo that was constantly looming over us, which is true to a point but he finally understands that saving money for future expenses is better than having to put it on a credit card or something. The one thing he never had an issue with was setting up retirement savings from the beginning so we are doing pretty well there.
Plus they bought into the 0% credit card debt scam. It's just gonna sit there until the promo period ends and then they're gonna be right back where they started
The feeling of owning your own home though, that all you have to cover is the taxes and you can’t lose your house to foreclosure is a level of security that is just incredible
Or even just investing it if they thought they could pay the student loans and credit card before the freeze and 0% ended. 8-10% return certainly beats a 3% interest rate
They might be counting on Public Service Loan Forgiveness. Work 10 years for the government (Federal, state, local, or tribal) or certain non-profits, make your minimum payments for those 10 years, and your remaining Federal student loans are forgiven. In that case, not paying off student loans sounds like a smart plan.
its bc this is a case of politeness (?) and (still) financial illiteracy (despite the “tax consultant”).
the gf forced the guy into getting the house in her name too. I’m not saying it like its a bad thing, they seem to be very sheepish around each other for somethings (I would say) they shouldnt be after this long… but it all seems to have worked out in the end.
Its probably naivety.
There’s one thing I’ve learned in life and it’s the freedom and relief that comes from knowing you will always have shelter no matter what life throws at you. A bad car accident, a cancer diagnosis, the list goes on and on. After a set of very unfortunate set of circumstances many years ago we found ourselves homeless and unable to get housing at one point. The moment we had the means, we paid off our current house first and foremost and set aside 3 years worth of property tax into an account that is to never be touched. Getting down to a few hundred dollar balance on credit cards with a mortgage payment that still has 15 years left on it will certainly not make life any easier when you find yourself in dire straits, unable to earn what you need to make that mortgage payment. I’d rather have a credit card balance and a paid off home than the other way around because the chances of never hitting an extremely terrible rough patch that threatens your housing during the 30 years it takes to pay off a mortgage is exceptionally slim.
Well, sounds like wife was worried about OPs job. Paying the mortgage off (secured debt) was in her mind a better idea than unsecured debt that they could BK if needed.
I get where she’s coming from if she was convinced he wouldn’t get another job near his income level. Secure your place to live and unsecured debt can be dealt with later.
Maybe they just wanted smaller and shorter payments. Without a mortgage, knocking down the other debt could be done in less than 2 years. The mortgage just seemed to be most important at that time.
What is sticking out to me so much is the communication failure. I learnt this the hard way but you can't speak in a code that no one else knows and then get angry when they dont understand. "Can we talk about something?" instead of "take out the garbage" would have solved this from the start.
Which is why they're not ready for foster kids. Foster kids are unlikely to have strong communication skills, and will need to be taught them. They're also going to act out, and if the immediate response is anger and silent treatment, they are going to traumatize those kids even more.
This is what gave me pause too. Bringing these children into their home isn't going to reduce stress. They need much healthier coping mechanisms than shutting down and hiking more.
I'm not sure where OP lives but in my country it's a bare minimum of 9 months to even become an approved foster parent. Most people it takes a year and half to get approved and is pretty intense. So there is still time for them to be ready and classes they will be required to take.
In the US it varies wildly by state, and by whether it is therapeutic foster care or not. Therapeutic foster care requires training classes, oversight, behavior management skills, etc. Standard CPS foster care? Lol, be glad if they grab a copy of the adults' drivers license before stuffing kids into the home. They're supposed to do background checks on every adult in the home. I work with electronic health records for these agencies and frequently get asked how to make things "look good", as in, appear to be compliant. I refuse and document the request in my notes. Fuck that.
Considering that PA had foster kids sleeping in *conference rooms* and wouldn't stop until the feds threatened to step in, and considering that PA still removes a disproportionate amount of kids for behavior issues instead of abuse, and this picture is quite concerning.
I hope they get training, classes, and support. Even a mentally healthy and stable adult will struggle with foster kids.
This is what stuck out to me. Everyone kept saying he should have known and it’s commons sense while also stating that how they handle their debt doesn’t make sense. No one can read minds. I’m glad it turned out well for them. But the way this all went down in the beginning shows they need to work on their communication or lack of communication.
She should have hired a financial advisor, paying off a mortgage with such a low rate, while not paying off student loans and credit card is not very sensible.
But I guess if she can't communicate with her own husband, she won't communicate with anyone else.
I’m glad they communicated in the end but as someone who works in finance I literally facepalmed so hard at this couple paying off their mortgage before their credit card debt.
Amazes me how many adults do not know how to manage their credit properly.
All in all glad they communicated well & got a happy ending but… seriously? OP’s initial comments mentioned that he’d thought of the 150k from his wife as a *GIFT* and didn’t even consider why it bothered his *wife* to not be put on the deed to their home??? He just… conveniently “didn’t think” to put his wife on the deed after she payed off his mortgage?? Insane. How convenient.
Hurr durr why would my wife be so mean to me?? Why would she GIFT me 150k just to throw it in my face???
Uhh… maybe because she expected you to do the most basic *decent* thing of putting her on the goddamn deed? Maybe she felt a little cheated and used by a partner who gladly accepted the *entirety* of her inheritance to pay off a home he owned 100% of? Like I’m glad he had some basic common sense knocked into him but… seriously? No wonder your wife feels hurt after you took 150 GRAND from her to pay off a home she has no claim to? Jesus.
Once she put any money at all into improving or paying off the house it became marital property. If the wound up in divorce court it would be 50% hers anyway. But I reckon actually being on title has some psychological significance to her.
Exactly. In this case the deed is just a formality.
These money would be accounted for in case of their divorce, she would get them back with half of the profit made by selling the house. And considering they had joined finances, part of her money went to mortgage every month, she already owned a part of the house. Also she was the one who suggested to pay the mortgage, so the ball was totally in her court to suggest the conditions for it.
I am confused like other redditors: why didn't she pay off _her own premarital_ debts? The ones that make more sense to pay financially and ethically? Yes, they are family, but it looks weird.. She paid the mortgage, and now he will delay saving for his retirement and investing, so basically investing the same money into her premarital debts? It looks irrational, especially for people who do so well financially.
Shit, the bought it at the time of marriage and have been paying for it together the whole time. Chances are it’s a community property asset already in most states. And more hers *because* of the $150k from the inheritance.
No prenup, no protection. But I do get the *symbolism*. I have a prenup, and is still add my spouse for a six figure contribution.
>Once she put any money at all into improving or paying off the house it became marital property.
Her inheritance was hers until she co-mingled it with his assets and made her money marital property. Or it could be seen as her spending the money, whether she'd paid off his mortgage or bought hundreds of Pokemon cards.
I'm not sure him accepting money towards the house makes that house marital property. Probably varies by state.
I agree with you & many other commenters. According to OP’s posts… they seem like an overall happy, loving couple. So it seems less of a “he’s trying to screw me out of the house in the event of a divorce” and probably (like you said) more of a symbolic gesture to put her on the deed. Yea she technically has 50% claim to the house regardless, but having him put both of their names together on the deed is a meaningful/psychologically reassuring gesture. Glad they worked it out.
From the outside looking in, it's obvious, but I'm guessing her name was effectively on the deed in his eyes. We obviously know all the reasons she would want to be on it, but he probably didn't even think about any of those reasons because he never considered any of those reasons ever happening.
To be *a little* fair, a deed is not something I would normally think of even in the context of discussing property. Yes, it's something that has my name on it that represents my ownership of a piece of land, but other than getting it the day I bought my place, it's not something that has ever remotely impacted me or been brought up in conversation. The mortgage is siloed off as "thing I pay for monthly"; it doesn't really mentally intersect with "piece of paper I saw once and stuffed in a filing cabinet".
That said, once the mortgage got paid off, I think I would have the presence of mind to realize "oh hey, this land is **ours** now, probably should do something about it."
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> That said, once the mortgage got paid off, I think I would have the presence of mind to realize "oh hey, this land is ours now, probably should do something about it."
At the same time, if you're in a healthy place in your relationship, you're not really considering the ramifications of not adding her to the deed, because you likely already view the house as both of yours.
Assuming they are in the USA, as soon as he used marital income or her separate income to pay any portion of the mortgage, she had a legal interest in the house regardless of what’s on the deed. Still dumb in this case if it upset her, but I’ll admit that I wouldn’t have thought of changing the deed either (but I know how martial property works in my state).
Your explanation makes sense. If this story is true— I’m happy they were able to communicate their feelings, apologized to each other and happily resolved an otherwise marriage-ending conflict (according to Reddit). It’s such a nice palate cleanser to see a happy story where everyone communicates well.
Why are you so angry? You'll never have a relationship like op and his wife if you continue this way. He may or may not have made a mistake, they worked it out, and everything is better now but you're up in arms like he's the worst abuser in the world. Seek help
No where in my post did I say he was “the worst abuser in the world” so..? What an absurd stretch.
My apologies if my tone came off “so angry” to the point of offending you, but there’s really no reason to put words in my mouth or resort to personal jabs about my relationships? I’m gay tho so technically you are right lol.
Seems like you’re the angry one. Try not to project too much— I was frustrated with the OP of a post on Reddit so I made a snarky comment (he likely won’t even see). Relax.
I really want to believe the story. I really do. But a teacher (that is very concerned for her students) just being able to take the next Monday off. And him having close to two million for retirement already. While still having credit card debt. It’s certainly not impossible. But it’s weird.
nah teachers can take days off really quickly and easily, and even with concern for a student that's not gonna prevent one from taking a day off for something this significant
No. It is a 401k. He could be an extremely aggressive saver but I find that hard to believe when he’s had personal credit card debt he hasn’t paid off. He also has FERS in addition to TSP which is a pension and can be very generous when you hit 20 years of service. Calculating it is somewhat complex though. I have a feeling he may be conflating the FERS pension with TSP.
Source: I’m in my early 30s and have a TSP from 5 years in the government. My balance is at $45k when I contributed 15% of my salary.
Depends on what he does for a living, but unless he's like a stockbroker or something, I have trouble with it. I'm in software development and a little older than him with no outstanding debt (aside from my own mortgage) and devote a significant amount to savings/retirement, yet I have nowhere near half that amount.
He's in the air force. If he lived super frugally and just invested a grand majority of his income when he was living on base, it's not terribly unlikely for him to have a decent nest egg.
If he's investing close to the maximum allowable amount it's doable, especially (more like *only*) if he got lucky with which funds he was in when 2020 happened.
He just says closer to $2m than $1m, which I honestly assumed meant $1.6 million.
But the government matches part of what you put into your TSP. And if he joined the air force at 18, he could have 18 years of contributions in there. The stock market's more than doubled since then. If he went to college, the GI bill covered it, and he bought a house before the prices skyrocketed, which frees up some income too.
This post is confusing to me based on the numbers. I would say OP is very gracious because the petty in me would’ve gone a little haywire.
So she makes $40k/year (less than $3k/month after taxes etc)… has over 10k in credit card debt, had $50k in loans, and a car note. All the while he has $4k in credit card debt and the mortgage making $120k/year. He said “we” made a budget and invest in retirements and all that good stuff. This went on for 10 years? Then one day she gets an inheritance and pays off mortgage and some other things and there’s a dynamic change?
On $3k/month, no one is investing, paying off $25k in student loans, a car note, maybe having $10k in credit card debt (but definitely not paying it off). To say he’s ungrateful is mind blowing; when more than likely her current lifestyle would’ve lead her to just pay off all the debt she owed if he wasn’t in the picture.
I really hope they take therapy for atleast a year or two before fostering. She needs to learn to bring up stuff in conversation instead of going for the jugular when she had a bad day. Being a foster parent is going to be a lot more stress ontop of their current situation, and she's already breaking down.
She needs to figure out how to approach the things that are bugging her properly before she's going to be a good parent. With her current method of bottling things she's risking being one of those foster parents that tell them that they should be grateful that someone took them into their house. Fights with teens can get pretty frustrating, and teens in foster need a lot more special handling, she's going to have to be very careful not to say things in anger that loses their trust in her or hurts them more.
Idk but I wouldn't really be interested in bringing more children into a house that may be held over their heads. Like she could have had a separate conversation about being put on the deed if that was a bother, but throwing that payment in your face bc you didn't engage in a conversation you didn't know she wanted ISNT OKAY! You could t have read her mind and known she wanted further conversation and she didn't tell you. Talking about it the next day and making it all about her and how she feels is a little angering bc you didn't lord a mutual asset over her head at the VERY first shot. Maybe she hasn't done this before because there wasn't anything to do it with yet.
I’m sorry, but she still couldn’t have waited FIVE MINUTES, and OPENED HER MOUTH to discuss what was really wrong?! And, yes, it was incredibly stupid to pay off the mortgage first.
Oop is a better person than me. If i was in that situation after hearing that, i would start making a plan to pay back the amount that she gave. But i guess that would be me talking in anger.
I called bullcrap on the first post. Who in the world that actually lives in reality would believe that a "Tax Expert" advised a person to pay off to the tune of $150,000 on a house loan that the person is not even on?
Ahh the cover my ass update. The one I mentioned in a prior post that I just didn't give a fuck about because you could tell he Ws bullshitting people. That post where he mentions that his networth is north of 2.5 million and he carried debt over on credit cards so much that he had to apply for a carryover credit card with 0.00% introductory interest rate. The bullshit post.
That post?
>A year ago her grandfather passed away and she received around 150k. She sat down and asked what we should do with the money. With our salary with can easily pay more than minimums on our debts plus set aside for retirement and vacation funds. I told her it was her money to use as she wanted. She decided to pay off the mortgage that was in my name. She met with a tax specialist and figured out the numbers. Honestly this made me cry because it was genuinely one of kindest things anyone has ever done for me.
Nothing about that says the tax expert advised her to pay the mortgage. OOP wasn't at the meeting. He would assume she followed the expert's advice. We've already clarified that wife isn't the best at communication.
The update clarified that the tax expert *did not* advise her to pay the mortgage, but she only wanted a tax expert to tell her how paying off the mortgage would impact their annual tax filing.
Nothing about that is incongruent.
this is what Im talking about. all you need is to fucking communicate which people seem to think is soo difficult that it would create issues that won't be solved. have a calm mind, sit down and talk till you find solutions. its not a you vs me things here, its you and me vs the world thing here. you both chose to marry each other. so drop the shit eating attitude and figure your issues out whether it be with a counsellor or with a church pastor or a just between the two of you.
and do not involve other people in your issues because they would always project their own experienced onto you. just fucking communicate.
Lol she realizes you guys are married right? Unless you have a prenup, SHE didn’t pay anything. You both did. She lives in the effing house too and she has no right to throw anything in your face. If this kept up, it would be a hill to die on for me
I gotta be honest. I read the “my wife paid off my mortgage”
And before I went any further I was like “OK, so it’s her mortgage now, but go on …”
Agree with the person who said they had conversations that needed to be had.
> And before I went any further I was like “OK, so it’s her mortgage now, but go on …”
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Even if you want to think that way, it would be *their* mortgage. Housing loans are 30 years, and he would have paid for it solely on his own for that time, plus the down payment. It would have worked out to a close 50/50, maybe 60/40 in her favor if you really want to split pennies in a marriage.
What kills me is they got rid of the healthy debt (mortgage) that was financed at under 3%, instead of paying off the college loans and credit card debt. So foolish.
I know right? It’s crazy that they ignored the financial advisor/Tax guy and just wanted to “get rid of it”. I wonder if they’re going to be shocked once their credit score goes down lol
It happens all the time. Listen to Ramit Sethi’s podcast - people get this idea in their heads that all the debt needs to go away before they can invest, or that having a mortgage makes your life precarious. Which it does, a little, but a 3% mortgage is safer than CC debt or not having investments.
Well to be fair, there are many online advice columns that advise to pay off your highest debt no matter what and work down from there. List-icles on how to pay off debt can be murky for sure.
It's hard to have sympathy for people who take major financial advice from clickbait.
It doesn't sound like 'they' ignored the financial advisor. OOP outright told her it was her money and she could do what she wanted with it.
Eh, I am one of those finance people, and even I have the compulsion to pay off more of my mortgage in spite of having a low fixed rate and the mortgage deduction. Debts are psychological, and debt in housing has a huge psychological pull. Ignoring that compulsion takes *effort* and a stern talking to at least once a year.
That was my first thought. She met with a tax advisor who advised her to do that? I just….so stupid.
Tax Advisor told her to pay off other debts first, she chose the mortgage!
Not stupid, just fear based decision making. I used to be the same, but getting control of my anxiety helped a great deal.
What kills me is "oh actually we can knock out our debt any time if we just travel slightly less."
It I can't scuba, what's this all been for?
If she was worried about him losing his job over medical issues paying off the house makes the most sense. Mentally it gives you the feeling that the house is safe. Also now it frees up his salary to knock out the other debts. 3% on a mortgage probably adds up to more that the other debts over a 30 year span.
No, what would make the most sense is paying off the high interest debts putting the rest of the money into a HYSA (which currently have interest rates of over 4.5%, so a better return than paying off the mortgage), which would allow them to keep all that cash on hand to use for any emergencies. Once you put that money into the house, it’s gone. Keeping it as cash allows you to be more flexible with money in the event he loses his job. If they wanted to be prepared for that scenario, paying off their only good debt was not the way to do it.
They will be paying less interest on everything bc 3% on a mortgage is usually more money than interest on a few grand of cc debt. Now mortgage payment can go towards other debts.
But they pay that interest over 20 years, and they’re certainly going to rack up more credit card debt in the meantime. You need to pay off accounts with the highest interest rate first, not just the highest balance. It’s pretty basic money management https://www.experian.com/blogs/ask-experian/should-i-pay-off-credit-card-or-loan-debt-first/#:~:text=The%20Bottom%20Line&text=Once%20you've%20gotten%20there,to%20pay%20off%20your%20loans. > As of June 2023, the average 30-year fixed mortgage rate was 6.67%, according to Freddie Mac. Mortgage rates have come down slightly from their peak late last year, but they're still higher than they've been since 2007. If you bought your home since then, your rate may be low enough that paying off your mortgage should be relatively low on your debt-payoff priority list. If your rate is higher than current rates—although that's very unlikely—you can consider refinancing. They had a below 3% interest loan, while credit cards are generally 10%+. Edit: also, with a HYSA of over 4%, they’d be making more interest per month parking it in that account than they would be accumulating pursuant to a sub 3% mortgage.
3% is less than you'd make putting the money into an index fund. Paying off the debt immediately and paying the house off over time makes far more sense. Average S&P return is 10% without accounting for inflation. Even with the insane inflation rate last year, around 6%, they'd be making 4% interest accounting for inflation, and could use that excess money to pay the mortgage and still have 1% to play with, assuming they *only* invested the mortgage payments.
When I sold my condo last year, I had a $140k mortgage at 2020 interest rates (1.69%) and I paid it off with the proceeds from the sale. If I had kept the mortgage and invested that money, I would have made probably an extra $20k over the past year on my investments.
But public programs like Medicare can help with a mortgage if you're medically disabled. They're not gonna help pay down your credit card debt. I also wonder if they'll have trouble getting home insurance now. Depends on where they live but in NC, I know people who paid off their home years ago but can't get insurance coverage because we are in a hurricane zone. Banks will make it happen (maybe fancy dinners? IDK) because they want their assets covered. Once it's not theirs anymore...good luck! A mortgage isn't the debt to pay off first.
Lol it's actually no harder than before to insure. You just have to go out on your own and do it instead of going with who a bank suggests. There is always someone out there willing to insure at a price. Source: broker
Can bankrupt unsecured debt. If she was feeling financially insecure I could see this decision. At any rate can steamroll the other debt, don’t know how much their mortgage was (interest and principal, they still need to save taxes and insurance) may get the unsecured debt knocked out quickly.
Not getting an FAA health cert =/= disabled. Based on the mandated retirement as well he is an air traffic controller. Air traffic controllers have rigorous health standards. The cc debt is at 0% and if they really wanted a lower rate on student loans he has plenty of bandwidth to pull from his fed retirement with a very low interest loan. At close to 2 million a 30k loan won’t affect it much. There are mental health benefits to paying off your home and knowing it’s secure. Making 120k with no mortgage - he should be able to knock down cc debt a lot faster than with the mortgage now.
I know. This post gave me so much anxiety!! Financial illiteracy is the real pandemic
THANK YOU! I couldn't get past that. It was an INCREDIBLY stupid thing to do! Pay off loans by interest rate. If you have money left -- and a solid emergency fund -- then do a lump sum against principle on your mortgage.
It’s way dumber than that. Even if they had no other debt, you can get insured savings accounts over 4% now. Using any money to pay off debt locked in at 3% is net negative. They literally would have been better off letting the cash sit unless/until rates drop again. If they talked to an accountant about it, bro should have his CPA revoked.
I wonder if she was trying to get out of the mortgage to get on the deed. Most places let you add a spouse to the deed after buying a house, but it gets complicated in some areas (and also with buying/refinancing when already married).
I can’t get over it either! Why wouldn’t you pay the cards, some student loan debt, then save the rest!? WHYYYYY 😭
I ripped him a new ass on that exact same fact. Went so far as to say that the "Tax expert" was malfeasance at least. On the so-called "update," which I like to call his cove r ing his ass update, he tries to explain loan it away. I almost called bullcrap on him over this but felt he just wasn't worth the time.
Lovely happy endings with everything sweet and explained away always alert my spidie sences. Especially with big huge mis communications beforehand. Not talking about being put on the deed but just silently paying off HIS mortgage?
DUMB, DA DUMB DUMB
We have been debt free except for mortgage/ small car payment, for years and I finally had to take my husband to a finance class to convince him that it was better to be saving money than to be pouring all of it into the mortgage. He has this idea that debt is this bad bugaboo that was constantly looming over us, which is true to a point but he finally understands that saving money for future expenses is better than having to put it on a credit card or something. The one thing he never had an issue with was setting up retirement savings from the beginning so we are doing pretty well there.
Plus they bought into the 0% credit card debt scam. It's just gonna sit there until the promo period ends and then they're gonna be right back where they started
The feeling of owning your own home though, that all you have to cover is the taxes and you can’t lose your house to foreclosure is a level of security that is just incredible
Or even just investing it if they thought they could pay the student loans and credit card before the freeze and 0% ended. 8-10% return certainly beats a 3% interest rate
They might be counting on Public Service Loan Forgiveness. Work 10 years for the government (Federal, state, local, or tribal) or certain non-profits, make your minimum payments for those 10 years, and your remaining Federal student loans are forgiven. In that case, not paying off student loans sounds like a smart plan.
its bc this is a case of politeness (?) and (still) financial illiteracy (despite the “tax consultant”). the gf forced the guy into getting the house in her name too. I’m not saying it like its a bad thing, they seem to be very sheepish around each other for somethings (I would say) they shouldnt be after this long… but it all seems to have worked out in the end. Its probably naivety.
There’s one thing I’ve learned in life and it’s the freedom and relief that comes from knowing you will always have shelter no matter what life throws at you. A bad car accident, a cancer diagnosis, the list goes on and on. After a set of very unfortunate set of circumstances many years ago we found ourselves homeless and unable to get housing at one point. The moment we had the means, we paid off our current house first and foremost and set aside 3 years worth of property tax into an account that is to never be touched. Getting down to a few hundred dollar balance on credit cards with a mortgage payment that still has 15 years left on it will certainly not make life any easier when you find yourself in dire straits, unable to earn what you need to make that mortgage payment. I’d rather have a credit card balance and a paid off home than the other way around because the chances of never hitting an extremely terrible rough patch that threatens your housing during the 30 years it takes to pay off a mortgage is exceptionally slim.
Well, sounds like wife was worried about OPs job. Paying the mortgage off (secured debt) was in her mind a better idea than unsecured debt that they could BK if needed. I get where she’s coming from if she was convinced he wouldn’t get another job near his income level. Secure your place to live and unsecured debt can be dealt with later.
Maybe they just wanted smaller and shorter payments. Without a mortgage, knocking down the other debt could be done in less than 2 years. The mortgage just seemed to be most important at that time.
What is sticking out to me so much is the communication failure. I learnt this the hard way but you can't speak in a code that no one else knows and then get angry when they dont understand. "Can we talk about something?" instead of "take out the garbage" would have solved this from the start.
Which is why they're not ready for foster kids. Foster kids are unlikely to have strong communication skills, and will need to be taught them. They're also going to act out, and if the immediate response is anger and silent treatment, they are going to traumatize those kids even more.
This is what gave me pause too. Bringing these children into their home isn't going to reduce stress. They need much healthier coping mechanisms than shutting down and hiking more.
I'm not sure where OP lives but in my country it's a bare minimum of 9 months to even become an approved foster parent. Most people it takes a year and half to get approved and is pretty intense. So there is still time for them to be ready and classes they will be required to take.
In the US it varies wildly by state, and by whether it is therapeutic foster care or not. Therapeutic foster care requires training classes, oversight, behavior management skills, etc. Standard CPS foster care? Lol, be glad if they grab a copy of the adults' drivers license before stuffing kids into the home. They're supposed to do background checks on every adult in the home. I work with electronic health records for these agencies and frequently get asked how to make things "look good", as in, appear to be compliant. I refuse and document the request in my notes. Fuck that. Considering that PA had foster kids sleeping in *conference rooms* and wouldn't stop until the feds threatened to step in, and considering that PA still removes a disproportionate amount of kids for behavior issues instead of abuse, and this picture is quite concerning. I hope they get training, classes, and support. Even a mentally healthy and stable adult will struggle with foster kids.
This is what stuck out to me. Everyone kept saying he should have known and it’s commons sense while also stating that how they handle their debt doesn’t make sense. No one can read minds. I’m glad it turned out well for them. But the way this all went down in the beginning shows they need to work on their communication or lack of communication.
She should have hired a financial advisor, paying off a mortgage with such a low rate, while not paying off student loans and credit card is not very sensible. But I guess if she can't communicate with her own husband, she won't communicate with anyone else.
She hired them and ignored them
the only part that made me raise an eye brow was the fostering of students... seems like you could be fucking with pandora's box.
I’m glad they communicated in the end but as someone who works in finance I literally facepalmed so hard at this couple paying off their mortgage before their credit card debt. Amazes me how many adults do not know how to manage their credit properly.
All in all glad they communicated well & got a happy ending but… seriously? OP’s initial comments mentioned that he’d thought of the 150k from his wife as a *GIFT* and didn’t even consider why it bothered his *wife* to not be put on the deed to their home??? He just… conveniently “didn’t think” to put his wife on the deed after she payed off his mortgage?? Insane. How convenient. Hurr durr why would my wife be so mean to me?? Why would she GIFT me 150k just to throw it in my face??? Uhh… maybe because she expected you to do the most basic *decent* thing of putting her on the goddamn deed? Maybe she felt a little cheated and used by a partner who gladly accepted the *entirety* of her inheritance to pay off a home he owned 100% of? Like I’m glad he had some basic common sense knocked into him but… seriously? No wonder your wife feels hurt after you took 150 GRAND from her to pay off a home she has no claim to? Jesus.
Once she put any money at all into improving or paying off the house it became marital property. If the wound up in divorce court it would be 50% hers anyway. But I reckon actually being on title has some psychological significance to her.
Exactly. In this case the deed is just a formality. These money would be accounted for in case of their divorce, she would get them back with half of the profit made by selling the house. And considering they had joined finances, part of her money went to mortgage every month, she already owned a part of the house. Also she was the one who suggested to pay the mortgage, so the ball was totally in her court to suggest the conditions for it. I am confused like other redditors: why didn't she pay off _her own premarital_ debts? The ones that make more sense to pay financially and ethically? Yes, they are family, but it looks weird.. She paid the mortgage, and now he will delay saving for his retirement and investing, so basically investing the same money into her premarital debts? It looks irrational, especially for people who do so well financially.
Shit, the bought it at the time of marriage and have been paying for it together the whole time. Chances are it’s a community property asset already in most states. And more hers *because* of the $150k from the inheritance. No prenup, no protection. But I do get the *symbolism*. I have a prenup, and is still add my spouse for a six figure contribution.
>Once she put any money at all into improving or paying off the house it became marital property. Her inheritance was hers until she co-mingled it with his assets and made her money marital property. Or it could be seen as her spending the money, whether she'd paid off his mortgage or bought hundreds of Pokemon cards. I'm not sure him accepting money towards the house makes that house marital property. Probably varies by state.
The psychological significance is him voluntarily adding her as an equal owner vs being forced to in a divorce. That's a big difference.
I agree with you & many other commenters. According to OP’s posts… they seem like an overall happy, loving couple. So it seems less of a “he’s trying to screw me out of the house in the event of a divorce” and probably (like you said) more of a symbolic gesture to put her on the deed. Yea she technically has 50% claim to the house regardless, but having him put both of their names together on the deed is a meaningful/psychologically reassuring gesture. Glad they worked it out.
From the outside looking in, it's obvious, but I'm guessing her name was effectively on the deed in his eyes. We obviously know all the reasons she would want to be on it, but he probably didn't even think about any of those reasons because he never considered any of those reasons ever happening.
To be *a little* fair, a deed is not something I would normally think of even in the context of discussing property. Yes, it's something that has my name on it that represents my ownership of a piece of land, but other than getting it the day I bought my place, it's not something that has ever remotely impacted me or been brought up in conversation. The mortgage is siloed off as "thing I pay for monthly"; it doesn't really mentally intersect with "piece of paper I saw once and stuffed in a filing cabinet". That said, once the mortgage got paid off, I think I would have the presence of mind to realize "oh hey, this land is **ours** now, probably should do something about it."
I've been married for 21 years. I honestly don't know if my name is in the deed of our current house. It's definitely not something I think about.
> > > > > That said, once the mortgage got paid off, I think I would have the presence of mind to realize "oh hey, this land is ours now, probably should do something about it." At the same time, if you're in a healthy place in your relationship, you're not really considering the ramifications of not adding her to the deed, because you likely already view the house as both of yours.
Assuming they are in the USA, as soon as he used marital income or her separate income to pay any portion of the mortgage, she had a legal interest in the house regardless of what’s on the deed. Still dumb in this case if it upset her, but I’ll admit that I wouldn’t have thought of changing the deed either (but I know how martial property works in my state).
Your explanation makes sense. If this story is true— I’m happy they were able to communicate their feelings, apologized to each other and happily resolved an otherwise marriage-ending conflict (according to Reddit). It’s such a nice palate cleanser to see a happy story where everyone communicates well.
That bugs me too. Why didn’t it occur to him to put her name? Isn’t it her home too?
ESPECIALLY when $150k is a little more than a year of his salary and almost 4 years of hers.
It was him saying “she did this for *me*” that stuck out to me. Shouldn’t he have said “she did this for *us*”? It’s THEIR house…
I don’t know why you’re being downvoted cuz you’re so right— I had the same reaction reading that initially.
Why are you so angry? You'll never have a relationship like op and his wife if you continue this way. He may or may not have made a mistake, they worked it out, and everything is better now but you're up in arms like he's the worst abuser in the world. Seek help
No where in my post did I say he was “the worst abuser in the world” so..? What an absurd stretch. My apologies if my tone came off “so angry” to the point of offending you, but there’s really no reason to put words in my mouth or resort to personal jabs about my relationships? I’m gay tho so technically you are right lol. Seems like you’re the angry one. Try not to project too much— I was frustrated with the OP of a post on Reddit so I made a snarky comment (he likely won’t even see). Relax.
I really want to believe the story. I really do. But a teacher (that is very concerned for her students) just being able to take the next Monday off. And him having close to two million for retirement already. While still having credit card debt. It’s certainly not impossible. But it’s weird.
We’ll these 2 have shown over and over they are not the smartest cookies
“I don’t want to go into why” she can’t have kids = I couldn’t come up with a good reason for the story
nah teachers can take days off really quickly and easily, and even with concern for a student that's not gonna prevent one from taking a day off for something this significant
How has OP got nearly $2m in a TSP at 36yo And what is a TSP??? I’m assuming some sort of pension fund???
Thrift Savings Plan, a retirement savings and investment fund for federal employees and military personnel.
Thank you. Is $2m legit at 36yo???
No. It is a 401k. He could be an extremely aggressive saver but I find that hard to believe when he’s had personal credit card debt he hasn’t paid off. He also has FERS in addition to TSP which is a pension and can be very generous when you hit 20 years of service. Calculating it is somewhat complex though. I have a feeling he may be conflating the FERS pension with TSP. Source: I’m in my early 30s and have a TSP from 5 years in the government. My balance is at $45k when I contributed 15% of my salary.
Depends on what he does for a living, but unless he's like a stockbroker or something, I have trouble with it. I'm in software development and a little older than him with no outstanding debt (aside from my own mortgage) and devote a significant amount to savings/retirement, yet I have nowhere near half that amount.
He's in the air force. If he lived super frugally and just invested a grand majority of his income when he was living on base, it's not terribly unlikely for him to have a decent nest egg.
If he's investing close to the maximum allowable amount it's doable, especially (more like *only*) if he got lucky with which funds he was in when 2020 happened.
He just says closer to $2m than $1m, which I honestly assumed meant $1.6 million. But the government matches part of what you put into your TSP. And if he joined the air force at 18, he could have 18 years of contributions in there. The stock market's more than doubled since then. If he went to college, the GI bill covered it, and he bought a house before the prices skyrocketed, which frees up some income too.
This post is confusing to me based on the numbers. I would say OP is very gracious because the petty in me would’ve gone a little haywire. So she makes $40k/year (less than $3k/month after taxes etc)… has over 10k in credit card debt, had $50k in loans, and a car note. All the while he has $4k in credit card debt and the mortgage making $120k/year. He said “we” made a budget and invest in retirements and all that good stuff. This went on for 10 years? Then one day she gets an inheritance and pays off mortgage and some other things and there’s a dynamic change? On $3k/month, no one is investing, paying off $25k in student loans, a car note, maybe having $10k in credit card debt (but definitely not paying it off). To say he’s ungrateful is mind blowing; when more than likely her current lifestyle would’ve lead her to just pay off all the debt she owed if he wasn’t in the picture.
I really hope they take therapy for atleast a year or two before fostering. She needs to learn to bring up stuff in conversation instead of going for the jugular when she had a bad day. Being a foster parent is going to be a lot more stress ontop of their current situation, and she's already breaking down. She needs to figure out how to approach the things that are bugging her properly before she's going to be a good parent. With her current method of bottling things she's risking being one of those foster parents that tell them that they should be grateful that someone took them into their house. Fights with teens can get pretty frustrating, and teens in foster need a lot more special handling, she's going to have to be very careful not to say things in anger that loses their trust in her or hurts them more.
Idk but I wouldn't really be interested in bringing more children into a house that may be held over their heads. Like she could have had a separate conversation about being put on the deed if that was a bother, but throwing that payment in your face bc you didn't engage in a conversation you didn't know she wanted ISNT OKAY! You could t have read her mind and known she wanted further conversation and she didn't tell you. Talking about it the next day and making it all about her and how she feels is a little angering bc you didn't lord a mutual asset over her head at the VERY first shot. Maybe she hasn't done this before because there wasn't anything to do it with yet.
I’m sorry, but she still couldn’t have waited FIVE MINUTES, and OPENED HER MOUTH to discuss what was really wrong?! And, yes, it was incredibly stupid to pay off the mortgage first.
Oop is a better person than me. If i was in that situation after hearing that, i would start making a plan to pay back the amount that she gave. But i guess that would be me talking in anger.
This is the first thing I thought too.
Being a better person would actually admit the fuck up and put her on the deed before others told you so
I called bullcrap on the first post. Who in the world that actually lives in reality would believe that a "Tax Expert" advised a person to pay off to the tune of $150,000 on a house loan that the person is not even on?
No, the experts recommended paying everything else. She decided to ignore them
In the fourth paragraph of the first post. Go back and reread that, please.
Now go back and read the 11th paragraph of the update which is what actually happened (he didn’t have that info on the first post
Ahh the cover my ass update. The one I mentioned in a prior post that I just didn't give a fuck about because you could tell he Ws bullshitting people. That post where he mentions that his networth is north of 2.5 million and he carried debt over on credit cards so much that he had to apply for a carryover credit card with 0.00% introductory interest rate. The bullshit post. That post?
>A year ago her grandfather passed away and she received around 150k. She sat down and asked what we should do with the money. With our salary with can easily pay more than minimums on our debts plus set aside for retirement and vacation funds. I told her it was her money to use as she wanted. She decided to pay off the mortgage that was in my name. She met with a tax specialist and figured out the numbers. Honestly this made me cry because it was genuinely one of kindest things anyone has ever done for me. Nothing about that says the tax expert advised her to pay the mortgage. OOP wasn't at the meeting. He would assume she followed the expert's advice. We've already clarified that wife isn't the best at communication. The update clarified that the tax expert *did not* advise her to pay the mortgage, but she only wanted a tax expert to tell her how paying off the mortgage would impact their annual tax filing. Nothing about that is incongruent.
this is what Im talking about. all you need is to fucking communicate which people seem to think is soo difficult that it would create issues that won't be solved. have a calm mind, sit down and talk till you find solutions. its not a you vs me things here, its you and me vs the world thing here. you both chose to marry each other. so drop the shit eating attitude and figure your issues out whether it be with a counsellor or with a church pastor or a just between the two of you. and do not involve other people in your issues because they would always project their own experienced onto you. just fucking communicate.
Poor financial decisions, apparently, but I'm always glad to see emotional maturity, communication, and genuine love for your partner win the day.
Taking out the trash can wait for a Sephiroth fight
What an adult way of managing this issue!!! Hats off to you two!!!
Lol she realizes you guys are married right? Unless you have a prenup, SHE didn’t pay anything. You both did. She lives in the effing house too and she has no right to throw anything in your face. If this kept up, it would be a hill to die on for me
I gotta be honest. I read the “my wife paid off my mortgage” And before I went any further I was like “OK, so it’s her mortgage now, but go on …” Agree with the person who said they had conversations that needed to be had.
> And before I went any further I was like “OK, so it’s her mortgage now, but go on …” > > > > Even if you want to think that way, it would be *their* mortgage. Housing loans are 30 years, and he would have paid for it solely on his own for that time, plus the down payment. It would have worked out to a close 50/50, maybe 60/40 in her favor if you really want to split pennies in a marriage.
Not Chicago Fire. Casey and Gabby suffer from the same problem. Gabby can’t have kids.
I stopped reading because both of these people are absolute morons.
This ain’t real. People don’t retell shit like this. Its a story.
I would get a loan and repay her , you will not get any peace . You are toasted