About Melissa Batai
For many people, having a money talk with a boyfriend or girlfriend feels awkward and uncomfortable. Yet, if your relationship is becoming more serious, know there are four reasons why couples should talk about money. If you face your fears, discomfort, and insecurities early in the relationship and start having regular money talks, you’ll likely find your relationship becomes stronger in the upcoming years.
You know the old phrase, “Opposites attract.” There is truth to that phrase, especially when it comes to money management. A frugal person can learn to relax a little and have more fun from a partner who loves to spend and enjoy money. However, the spendthrift partner can also learn to save more from the frugal partner. Ideally, the two balance one another out. However, before that can happen, you each need to learn how to deal with a financial opposite spouse.
Do you set New Year’s resolutions? If so, I want to urge you to set goals instead. In addition, try to think about goals you want to achieve in all aspects of your life so you have more well-rounded goals in 2022.
You know the awkward moment when you’re sitting in a restaurant, having enjoyed an excellent meal and great company, when the check arrives. Should you divide the amount among all diners? Should you pull out your calculators and determine who owes what? That situation can get even more awkward if you’re deciding if you should split checks evenly with your spouse.
The holiday season brings to light problems that you don’t typically face, like how rude your great aunt Mabel is. However, since you only see her during the holidays, you can tolerate her behavior. Yet, that’s not the case for some holiday-related issues. For instance, you may have spouse who gives you expensive gifts that you hate. How do you handle this sticky situation?
If you and your spouse have a large age gap, you’re not alone, especially if you’re in your second marriage. While only 5% of men in their first marriage are married to a woman 10 years or younger than they are, that figure jumps to 20% in second marriages (Pew Research). If you have this age gap, you need to carefully plan how to retire as a couple with age disparity.
We’ve owned our house for seven and a half years now, and we’ve made several improvements such as replacing the worn-out carpet in the bedrooms, painting the entire house inside and out, and painting our kitchen cupboards. Soon, we’ll be replacing our master shower with tile. I keep a separate category in our budget for home improvements, but I’m going to start keeping good records to pay less in capital gains when we sell.
Good records are essential because over the years, you may forget the repairs you’ve made, how much they cost, and who did them. However, first, you must know what expenses count as capital improvements.
Not all home repairs and improvements are the same. The painting we’ve done inside and outside our house is routine maintenance and does not count toward capital improvements. However, upgrading our master bathroom shower to a tile shower is an upgrade and adds value to our home. That is considered a capital improvement.
All capital improvements reduce your capital gains when you sell your home.
The IRS has a complete list of repairs/upgrades that are considered capital improvements. In general, if you’re upgrading some part of your house, it might qualify as capital improvements. These items may include:
In our case, we also plan to replace our sliding glass door and replace our roof. Those will be expenses I need to record for capital improvements.
If you make an improvement, but it isn’t in evidence when you sell the house, you can’t count that improvement for capital improvements. For instance, take the tile shower we’re adding now. If, 10 years from now, we completely remodel the bathroom and redo the tile shower, the original tile shower upgrade will not count toward capital improvements even though it did improve the house at the time.
To prove that you made the improvements, you’ll need careful records. You will want to keep a running list of the date the improvement was made, who did the improvement, and how much it cost. To support this data, you will need copies of the receipts, canceled checks, or any other documentation that you received.
You’ll want to keep this in a physical file somewhere secure like a safe or a safe deposit box. You should also keep a digital record.
Capital improvements can help increase the basis of your home, which can make the amount of capital gains that you must pay smaller. However, to reap this reward, you must know what counts as capital improvements. You also must keep proof of your improvements, which is why you will want to keep good records to pay less in capital gains.
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The media loves to point out that one major cause of divorce is financial disagreements. Maybe the media talks about that so much because every marriage in the United States has a 40 to 50% chance of ending in divorce. That’s enough to make you consider not getting married! However, consider the flip side of this that’s never mentioned in the media—couples who effectively grow wealth together. When a couple is in sync financially, they can have a strong, financially secure union.
If you’re like many people, you may make an effort in December to donate. Maybe you buy a toy for a child in need or contribute a few coins or dollars to the Salvation Army pot outside the grocery store. However, if you are in a good financial situation, why not consider starting 2022 with a random giving fund to make giving part of your life all year long?
If you’ve decided as a couple that you don’t want to have kids, you likely spend both time and money making sure you have effective birth control. As you reach your 30s, you may look for a more permanent birth control. A woman could choose to have a tubal ligation, or a man could choose to have a vasectomy. However, many doctors prefer to perform these surgeries on people in their 30s or older just in case there is a chance the couple may change their minds about having kids. If you do decide to get a vasectomy, will health insurance cover vasectomy costs?
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