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am I being greedy/unreasonable?
Until now, DH and I have had separate money and paid for bills out of a joint account into which we both pay equal amounts, it covered the bills and we have a joint mortgage. We previously saved separately. We now have a child coming, so agreed to pool our future incomes (not previous assets) into joint account, and take out equal monthly "pocket money" for our personal pension contributions, personal investments, personal expenses deemed not essentials for the family like, going for a beer, a special gym class, birthdays gifts, personal savings. I am fine with putting all my income in. DH is self-employed, he leaves part of his income in his business to cover emergencies, training and work tools investment, staff costs if there is a cash flow problem. This is smart and sensible.
However, if things turn sour, I am worried that he will be able to hide money in his business and claim to be skint. I have no reason to believe he would do this, but I have seen usually reasonable people turn unrecognisable during a break up. So, I will have put my entire income into the joint account and have less of an emergency nest egg. I think it would be fair that his held back income is taken into account in the event of a breakup. He says, no way, that is not his money, it is the business' money and you're not having a claim on any of it. I understand his concern, an angry wife might try and destroy his business. But he doesn't seem to understand my concern of him squirrelling/hiding money if it all goes wrong and says we should concentrate on staying together. I also want to stay together. We are very happy. Am I being greedy/unreasonable? Should I just leave it?
Leave the what might be alone, you might get run over by a bus tomorrow. Have you got any plans for that? Enjoy life while you can, Stop over thinking things, the bus might turn up.
I completely disagree, Annie. Expect the best, but prepare for the worst, and that includes death (of either one of you), or divorce. Getting your ducks in a row doesn't make it likelier to happen.
Does he own the business himself, or a share of it? If it predates your marriage, is there a prenuptial agreement about it, or are you in Scotland? Chances are, regardless of what you have informally agreed, the business, or at least part of it, will be considered marital assets. Typically a divorce court would try to allow one partner to keep their business intact, but they'd have to "buy out" their spouse with an equally valuable chunk of the personal assets (house, savings, pensions etc). If there's reason to believe the business is being undervalued to cheat the settlement, the victim could dig their heels in and insist on a 50/50 split of everything: business, house, pensions, the works.
I don't think you need to change how you juggle the money, but you really ought to be kept up to date with the business accounts as well. Much better all round to be open with the books as you go along, giving the business owner the option to keep the business intact. And as you're in the process of merging your finances, this would be the ideal time to start.
Thanks for your replies. Open books is a good idea and DH did say I was free to look at the company books any time. We will add this as a point on our family finance reviews. I raised the point, what if you die and me and our children need that money? Because DH owns 50% of the business with a partner. And he said - well then you talk to my partner is who is a reasonable guy. I think this is not too sensible to be honest and would rather have the provision in writing - to protect me, our kids and also his business partner, who might not be able to afford to shell out 50% of the business capital in one go if my DH dies. We are not in Scotland but in a country where unless we state otherwise, all assets are joint. I think the business partnership does pre-date our marriage just about, but if DH's earnings are being kept back into it, then that should be documented, and I should be aware. I tried to explain to DH I would never try and crush his business but didn't think it fair to spilt our assets 50/50 in the event of a breakup and then he gets to keep his business investments on top.
You could get him to give you a shareholding in Co...
thanks suzietwo we talked again and I explained I really want to understand what happens in case of death and separation and he said he doesn't know exactly, until now, with his business partner, they agreed all would go to the other. As they want the business to keep running after their death. Fair enough, so what will DH do if his business partner's wife wants the partners share out in one go in the even of his death? We'd have to go to a lawyer to work it out properly and really know what would happen. So when our child arrives, that is what we'll do.
As a corporate lawyer I suggest you get this sorted ASAP - before baby arrives and your time/money are taken up with other matters. I've seen plenty of such arrangements go sour astonishingly quickly and you do not need to be worrying about this when also juggling a newborn.
Best fix might be cross options supported by life insurance policies - if either partner dies the proceeds of life insurance are used to buy out the deceased's shares in the company (ie the cash goes to the surviving spouse if they are beneficiary under the deceased's will). It is more complex if it's a business/partnership not a limited company - do try to get some legal and tax advice ASAP.
thanks, for the great suggestion french we've just closed some of DHs life insurance policies to increase liquidity but maybe the the company should should pay for that. When he told me their plan was that all goes to the remaining business partner so the business would keep going - I was pretty incredulous. But managed to say calmly, ok, that worked when we weren't married but we are now and we've a child coming so, I think it needs to be rethought, especially as your business partner is older than you are. It's your business, protect it. We're your family, protect us.
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