Assumptions and Expectations
Last year, one of the ways I took control of my finances was moving my Roth IRA to a Vanguard Target Retirement fund. It wasn’t that my IRA was doing badly, but I hadn’t really been actively involved in deciding how to invest it when it was opened, and I was unhappy with how I was being treated by the brokerage that held it as well as the fees I was being charged. Changing over my IRA to something I researched and I chose was a symbolic move for me in the process of taking charge of my financial destiny.
My spouse also has an IRA, which he opened when the last job he was at ended to move his 401K from that job into. He doesn’t actively invest in it, all of his current retirement savings are directed at his 401K at his current job, but the IRA does exist. It is in a CD at a bank local to where we lived at the time, and every January he gets a letter it is going to renew at the beginning of February, and every February it does.
When I rolled my IRA into the new fund, I just assumed that when my spouse’s CD was ready to mature again, we would just roll that into a fund at Vanguard as well. It is not a huge amount, but it is enough to open a Vanguard account. I don’t even think I really asked my spouse about it - I think I told him my plan, and I wrote about it here, but I really don’t think I ever asked exactly until recently.
I asked because a few weeks ago we got the yearly letter from the bank his IRA is at, letting us know that if we take no action, his CD will renew for another year. I gave it to my spouse, assuming he would have me open a Vanguard account for him. In fact, I said “Let me know if you want me to open a Vanguard account for you” assuming he would say “Of course!”
I ask questions sometimes I expect to get a specific answer to just to ask them, I think.
Well, imagine my surprise when he didn’t jump right on my plan, and in fact, decided to leave his IRA in the CD for another year while he thinks about what he wants to do. I wasn’t so much upset as just, shocked. What? He doesn’t want to do exactly what I want?
This isn’t about who is right and who is wrong, and what the better idea is. I of course think my plan is the better one, and obviously, he has his reasons for deciding to think it over for another year. This is more about communication. Too often, my form of communication about finances with my spouse, since I handle all the day to day financial decisions, is to just tell him what is going on. And because I do the majority of the research and thinking about things, I just assume he’ll agree with whatever I say and expect him to go along with it. But that obviously isn’t the case, and shouldn’t be. He’s allowed to have an opinion too, and I have to remember that.
Maybe next time I won’t be so surprised.
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February 5th, 2008 at 7:04 am
I think that there are a couple of things going on here. One of them is that you are more right than your husband is - the CD is unlikely to be the better move.
Another is that to be fair to you, not only do you do all the day to day finances, you also read, and write successfully, about personal finance every day. It would be surprising if your husband knew more about personal finance than you - he might not appreciate this as much as he should.
But the important thing, is that you probably need to work on explaining to him why such and such a thing is a good idea financially so that he can get used to the idea a bit before it comes up.
I bet if you’d talked this IRA thing through in December, explained why something like a Target Retirement fund was a good idea, and given him the opportunity to get more comfortable with it, he would have been more likely to go for it now.
And just to reiterate, the CD is not likely to be the best place for a long-term investment.
February 5th, 2008 at 10:00 am
haha.. this is so funny. the exact same thing just happened at my house where i wanted to take some 20+ grand that we have in a low/no interest checking account, and move it to a high yield online savings account. To me it was a no-brainer, and I was all set to do it, but my wife wasn’t sure about it, and now wants to think about it a bit more. Your post is timely because it reminds me that my wife needs to feel involved in the money decisions, and even if I am making a final decision, she needs to feel like her input is heard. I need to realize that while I may think my opinion is right, she needs to know she can be heard as well.
February 5th, 2008 at 10:42 am
Great post on a crucially important topic! Lack of communication between partners about money can wreck a marriage–just a few days ago, I blogged about how my ex’s and my failure to communicate led to a disastrous series of mistakes, left us three-quarters of a million dollars in debt, and ended our marriage.
Even when one partner is a lot more knowledgeable about money and handles the couple’s finances, the other partner needs to understand everything that his going on in the couple’s financial life and must have a part in making decisions.
February 5th, 2008 at 1:01 pm
I imagine I’d be surprised too. As plonkee says, communication is really important…and sometimes I’m not sure what I’m actually communicating. Micah periodically reads my blog, but not every entry. We also talk about finances, but not everything. I’ll have to think about what Micah and I still need to discuss.
Good luck!
February 5th, 2008 at 1:06 pm
Wow! That is exactly how it is with my husband and me! I always feel a little guilty when I read blog posts about a husband and wife sitting down and going over their finances together because my husband and I don’t do that. He just isn’t that interested. I keep him up-to-date on “our” plans and he sometimes asks questions about where we’re at financially, which I’m always happy to answer.
I’m glad I’m not the only one! I don’t feel quite so guilty now for not have those monthly meetings some couples have
ps- Since I work for a financial services company, my husband didn’t balk when I mentioned moving his IRA out of the bank cd and into mutual funds. I knew before I talked to him, though, that I had to let it be HIS decision
February 5th, 2008 at 2:05 pm
This is pretty funny! I have been all set to move the majority of our savings to an online savings account (um… say ING Orange with your referral!) and now here comes these ING Share Builder commercials! Now my husband want to read all about it and see if that is a better move. For me this turns out to be a good thing because now he is more interested in money and making our money make more money than just “how much do we have now” conversation!
A year is a long commitment to that CD- but maybe he does want to learn about and not just let you handle it. In the end it will all work out. (Also, what are the consequences to breaking the CD? One of ours we just didn’t earn the interest we would have if we kept it in, no real loss)
February 5th, 2008 at 4:27 pm
I am going through something similar with my husband’s old 401(k)… except he doesn’t really have an opinion on it and just goes along with what I want to do. The blind faith is easy, for sure, but a little nerve-wracking. I hope I do the right thing!
February 10th, 2008 at 2:44 pm
Good morning:
Thanks for contributing this post to this week’s Carnival of Family life, hosted at Health Plans Plus!
I don’t bother asking the hubby. I make the financial decisions. If I ask him, he’ll just say, “What do you think?” anyway. Why bother?
Early in the marriage, he made a couple of comments about things I had done which prompted me to point out that the right to voice an opinion is earned by participating in the decision-making process. He wasn’t interested in participating/assisting, so quickly bowed out.
Be sure to stop by the Carnival tomorrow and check out the other wonderful entries!
JHS
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