inherited some money - Page 3 - Talk About Marriage
Financial Problems in Marriage When financial times are tough, it adds to the stress we deal with on a daily basis. This section is for talking about how financial problems affect our relationships and ways to cope.

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post #31 of 46 (permalink) Old 11-06-2015, 08:50 PM
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Re: inherited some money

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Originally Posted by Yeswecan View Post
There is a reason the law is written that inheritance is not shared 50/50 when a marriage is concerned. It protects those that have a spouse that is hanging around to split the inheritance.

Paying the house off would be ok(IMO) if this home were to be your forever home. If not, I would have kept making the payments and taken the interest write off on my taxes. Your home is basically your only deductible on Federal returns(sans kids).
That deduction is useful only for those who itemize, which is a minority of tax filers. But even then, paying off the loan is a sure way to "make" whatever interest rate you were paying, which is probably a lot higher than whatever you could get in the bank.

In other words, paying off the mortgage is almost always the best way to go.


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post #32 of 46 (permalink) Old 11-09-2015, 11:44 AM
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Re: inherited some money

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That deduction is useful only for those who itemize, which is a minority of tax filers. But even then, paying off the loan is a sure way to "make" whatever interest rate you were paying, which is probably a lot higher than whatever you could get in the bank.

In other words, paying off the mortgage is almost always the best way to go.
I still disagree specifically since I said if this was a forever home. I do not see any sense in paying off a home that one only intends on living in for 5-10 years. Pay off your home in this situation is a gamble to me. Specifically if your home decreased in appraised value. Home appreciating in value is no longer a sure thing since 2008.

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post #33 of 46 (permalink) Old 11-09-2015, 12:49 PM
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Re: inherited some money

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I still disagree specifically since I said if this was a forever home. I do not see any sense in paying off a home that one only intends on living in for 5-10 years. Pay off your home in this situation is a gamble to me. Specifically if your home decreased in appraised value. Home appreciating in value is no longer a sure thing since 2008.
Well, unless you are going to walk away if the house is under water, I'm not sure why it is a gamble to pay it off.

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post #34 of 46 (permalink) Old 11-09-2015, 01:38 PM
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Re: inherited some money

So you think it is best to pay the bank 10K so you can deduct 10K on your taxes and have reduced taxes of perhaps 4K? What does the bank do for you? Since you prefer paying the bank more vs. the government less?

Paying taxes is not so bad, it means I earned more.
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post #35 of 46 (permalink) Old 11-09-2015, 01:50 PM
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Re: inherited some money

She should be happy you did that instead of going out there just spending money on nothing. A lot of people would have spent it on gambling, drugs negative stuff. What were her plans for the money? Do you not trust her? is that why you put money in a account in just your name? I am happy to see that there are some smart men out here that know how to spend money.
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post #36 of 46 (permalink) Old 11-09-2015, 02:20 PM
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Re: inherited some money

did she tell you thanks? great job getting us out of debt and helping our son?
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post #37 of 46 (permalink) Old 11-09-2015, 03:33 PM
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Re: inherited some money

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Well, unless you are going to walk away if the house is under water, I'm not sure why it is a gamble to pay it off.
It is a gamble, IMO, as the house could loose value. If one pays his house note off at $400k and the home loses value down the road then at resale the owner has lost some money. A lot depends on the interest rate currently on the home, age of person on mortgage, etc. Some would have suggested investing the money instead of paying off the home. Sure, a home is an investment but we see it is at risk from predatory lending, bad loans and approving anyone for a home loan as demonstrated in 2008 with the bubble busting. IMO, a home is as risky as investing in the market. However, if your home is paid you will always have a roof over your head no matter the state of the economy. That is always good for a peace of mind.

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post #38 of 46 (permalink) Old 11-09-2015, 08:51 PM
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Re: inherited some money

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It is a gamble, IMO, as the house could loose value. If one pays his house note off at $400k and the home loses value down the road then at resale the owner has lost some money. A lot depends on the interest rate currently on the home, age of person on mortgage, etc. Some would have suggested investing the money instead of paying off the home. Sure, a home is an investment but we see it is at risk from predatory lending, bad loans and approving anyone for a home loan as demonstrated in 2008 with the bubble busting. IMO, a home is as risky as investing in the market. However, if your home is paid you will always have a roof over your head no matter the state of the economy. That is always good for a peace of mind.
Yes, but if the owner doesn't pay off the house and sells it some day, then he is still out the same amount of money, as he will get that much less at closing. And he will still have had to pay interest on the loan as well.

Now it is true that if you have a non-recourse mortgage (as I do), that essentially gives you a free put option on the house at the amount left on the mortgage, because if the house is worth less than the mortgage you can walk away from it without penalty.

But even with that possible benefit, you are still paying interest on the loan until you pay it off. Can you earn more than your interest rate on investments elsewhere? If so, maybe paying off the mortgage is a bad idea.

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post #39 of 46 (permalink) Old 11-09-2015, 09:34 PM
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Well I'm old fashioned - we only have joint accounts and the inheritances (from my wife's parents) went into an addition and the latest will go towards either outer mortgage, LOC or kids college next year. It's all the same pile of cash.

Good job OP - you done gud!

We routinely borrowed from our LOC annually to buy an IRA for my wife before she went into teaching (at age 50 btw) because it only cost about $3500 for a $5000 IRA when you consider the actual cash impact on taxes. You'll never find a better return than $1500 on $3500 invested in 1 second. Of course we're paying juice on the LOC but rates are ultra low.

Point is we are in a partnership and if sh*t happens we'll deal with it then. The truth is the decades of scrimping and saving will all go to her and some new dude unless medical technology advances and I am spared in the next several years due to unlucky happenstance. It never mattered to me anyway - never wanted much and always made lots of $$$ so go figure. Meanwhile there are many more people with too many wants and not enough $$$. It's all really a test I've got amazing kids and an amazing wife do the money isn't important to me. Health would be nice too.
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post #40 of 46 (permalink) Old 11-19-2015, 08:26 AM
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Re: inherited some money

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Originally Posted by Yeswecan View Post
It is a gamble, IMO, as the house could loose value. If one pays his house note off at $400k and the home loses value down the road then at resale the owner has lost some money. A lot depends on the interest rate currently on the home, age of person on mortgage, etc. Some would have suggested investing the money instead of paying off the home. Sure, a home is an investment but we see it is at risk from predatory lending, bad loans and approving anyone for a home loan as demonstrated in 2008 with the bubble busting. IMO, a home is as risky as investing in the market. However, if your home is paid you will always have a roof over your head no matter the state of the economy. That is always good for a peace of mind.
They invested in the home's value at the time they bought it. That choice is gone.
The choice now is to pay down this debt, other debt or invest in assets, or keep as cash, or spend on x y z.

So it is the interest on the debt that matters, and the likely return on other assets.

And the tax implications. Crucially the tax implications...

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post #41 of 46 (permalink) Old 11-19-2015, 11:17 AM
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Re: inherited some money

FWIW, and I am a mere woman, I agree with the actions the OP took.
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post #42 of 46 (permalink) Old 11-19-2015, 09:27 PM Thread Starter
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Re: inherited some money

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"MY" money? Thats... a great team mentality. Maybe you ought to start referring to the house as "MY house", along with everything else. Really put her in her place.
Sorry, the home, the rental property, her new Lincoln, my classic Mustang convertible, my boat pulling truck, our loaner 4-wd truck, both of my boats...are all in OUR names, as well as our checking account, retirement, and all credit cards totally joint and have been for almost 50 years....I have under $10,000 in my account, for our vacations...
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post #43 of 46 (permalink) Old 11-19-2015, 09:36 PM Thread Starter
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Re: inherited some money

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She should be happy you did that instead of going out there just spending money on nothing. A lot of people would have spent it on gambling, drugs negative stuff. What were her plans for the money? Do you not trust her? is that why you put money in a account in just your name? I am happy to see that there are some smart men out here that know how to spend money.
She won't spend money on vacations, etc. So I kept some in a FUN account....

She has much more in our joint accounts, and handles all the bills...

We have spent about $35,000 in fixing up the house...Heat, air, roof, sofit, gutters, downspouts, appliances. reno'ed 2 baths, all new furniture, granite counter tops a handmade mantle and fireplace...It is her hobby....

She readily admits she has been denied nothing in our entire marriage...
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post #44 of 46 (permalink) Old 11-21-2015, 01:37 AM
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Re: inherited some money

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Ugh! Why do spouses think they are entitled to their spouse's inheritance? My husband got a little money from his mom which he spent on family (washer/dryer and paid a few bills off). He didn't have to. I sure the heck appreciated that he did. Then he got a bit of money from his grandmother when she died. I was glad he spent it on himself. He bought himself a new motorcycle. We're in the process of divorce now, but I would never take that from him, even if a judge demanded it. Every time I see it in the garage it makes me happy that he did that. He even named it after her.

The OP went beyond his duties to pay off all of that stuff. His wife should be thrilled.
I have to say i can't understand the converse attitude.

When i stood up and made my vows, in front of my family, they understood that anything they do for me they eould now be doing for us.

I understand the need for the legal differences with inheritances, but in my marriage everything is shared.

OP, you've been married 40ish years you say? If so, surely you would not consider this YOUR money.

That said I think you handled it v well, and paying off debt is almost always a good idea. Especially when you're older and your ability to repay debts from your future wages is diminished.

I don't intend to have any debt other than secured mortgage debt, and even that i want paid off before i hit 50. Inheritances will be a bonus, hopefully at a stage when we're already totally set.

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post #45 of 46 (permalink) Old 11-21-2015, 01:12 PM
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Re: inherited some money

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Entitled was the key word. I stand behind what I said. The person who got the inheritance should get to choose what they do with it. That's my personal opinion. When my husband got his, not once did I consider it mine. Yes, he shared it and that was his choice and I really appreciated it. Now, if it was the lottery, yes that should be shared. But, when it comes from someone's family, I feel differently.
That's the wonderful thing - we can all have different views about marriage and that's fine.

I expect my family to treat us like we are a single unit from the day we said our vows in front of them.

My wife wouldn't need to feel 'entitled' - everything that is mine is hers and vice versa.

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