SAHM - finances

[Sahlives]

2 kids under 4. DH high earner (400k+). I did ok pre kids (c100k).

Prior to having kids, we always managed our finances separately. I have about 50k invested but my DH (thanks to a few good years of promotion and bonuses) now has about 400k.

Here's the thing - we talk about what to spend it on. We have just bought a house that needs some work. We discuss 'our' finances but I just feel uncomfortable that essentially he has all the access to the bulk of our wealth and I have little by comparison.

How would you feel about my situation? It is unreasonable of me to request access to his savings after many years of saving separately? I don't think he's keen and this is what concerns me.

Also pensions - he's not topping up my pension. He's not against doing it but slightly bemused as he says if we divorce I will just get half of his anyway. So should I be pushing for it regardless?

I don't know if it's tiredness or peri brain fog (I'm in my 40s) but do not know what is reasonable and unreasonable of me anymore. Please give me some perspective

You’re a family? All money is joint so why have separate significant saving funds?
We both work full time (both high earners). All money is paid into one account with an equal amount transferred to personal accounts for spending as we wish.
Monthly amounts are transferred from the joint account to savings and investments, we both have access. Both of us have highly funded pension schemes. Now in our early 50’s and planning on early retirement.

I stand to be corrected by someone more knowledgeable, but I think with the pensions, the issue may not necessarily be re divorce (although he could prob afford a very good solicitor), but maybe check your rights to his pension upon his death. I know its not something you want to think about, but you would need to look after yourself and children as much as possible if that were to happen. And you should try to pull together as much as possible as he might not have the better paying role if you weren't there to pick up the childcare, cover children's sick days etc.

Don’t ever rely on a man for your finances. I wish someone had told me that years ago. It was more “normal” when I got married, for the man to be the main earner. I never had a career, just worked around kids. We overpaid into HIS pension scheme, because it was to support both of us, and had a better return. Same with shares.
Fast forward 25 years, he decided he preferred my friend to me, and left with all the shares and savings. I had to fight tooth and nail to get a small portion of “his” pension. Cost me £36k in legal fees. When we both reach retirement age, his personal annual pension will now be in the region of ten times my own. It’s a fallacy that assets will be split 50/50 automatically, in the case of a split. And the later in life you divorce, the more the balance sways towards the bigger earner.

Absolutely. Protect yourself.

I was a SAHM with DH on £40k and we prioritised paying into a pension for me, in my name. This is not negotiable.

On first read, he sounds like a complete and utter knob, feigning innocnece and "oh we will split it if we split up". He is clearly intelligent to earn as he does so should understand your need for more security. But.... I will also say, gently, do you have a very expensive lifestyle? To have only saved £50k over several years of earning £100k+ yourself, where is all the money going? I know tax is high etc, but perhaps there isn't actually that much "ready cash" to share? How do you share cash flow- is it all in one pot or does he hoard it? If all in one pot, can you not just tell - not ask - him that you're going to put £800 (or whatever) per month into your pension / savings?

Assuming the house is in joint 50/50 names? If so then spending from his savings pot on it, as a joint shared asset, is kind of boosting your "pot". If you can't agree anything else, I'd get on the case with that, sharpish

He probably wouldn't be able to do his £400k job as well, without you supporting him and the family. You are a family unit. Don't undervalue yourself.

You should be filling up both your pensions. Not just his. If you are a SAHM money should be joint with both of you having access.

It's really worrying that he doesn't want to invest in your pension.

However, while you have no income of your own, it might be more tax efficient to invest in S&S ISAs instead. Although, AFAIK, you can still put c. £2800 in a stakeholder pension (which HMRC uplifts by 25%.)

One thing to say as well. You need to make sure your own personal national insurance payments are also up to date. With you being a SAHM you wont be getting this deduction from payroll. These count towards your government pension. You can back pay these- log into the gov website to check where you are with those

If she is getting child benefit she'll automatically get NI credit.

Do you claim CB @Sahlives ?

I'd go back to work pronto if I were you. Childcare will not be much of an issue on this kind of joint income (unless of course your H decides you, with a 100K earning potential, should pay for it all... 🙄)
Protect yourself, keep your career and remain employable. Something tells me you'll need it.

I think a lot depends on how you make financial decisions now and how you manage day/day expenses.

If you are SAHM - and he is the high earner - you both should me maximising annual tax free ISA allowance. And at least put the £2800 into stakeholder pension.
And - you both need to have similar budget/expenses ‘privileges’ - meaning that you can spend within some jointly agreed limits without needing each other’s permission.
I am guessing he also would have some pension plan at work he’ll be putting money in.
If there is still money left over - I do think it makes sense to mange it in one account - say shares. And i am not sure most of those can have dual access.

the setup i am describing is fairly reasonable if you two don’t have big disagreements on how to spend the money. And if you don’t feel he makes all decisions.

He is not wrong to say that assets would be divided 50/50ish. And that you would most likely get a share of his pension.

However - if he is NOT topping up your ISA and stakeholder pension - and audits your monthly expenditures - while not letting do the same - than I’d say it’s unfair.

On 400K a year????

Of course!

Her husband will have to account for the CB on his tax return, but she WILL get National Insurance credit.

It's absolutely vital that she does.

And I agree with @Rec0veringAcademic about returning to paid employment...... sooner rather than later. Being a SAHM is a high risk strategy.

Yes I am registered for national insurance credits.

It has definitely made me rethink going back to work. I was going to wait until youngest is off to school but I think when they turn 3 will be better.

Day to day I don't go without. He's not tight as such & doesn't monitor spending or anything like that. From the outside you'd think 'we' were wealthy but my feeling is that "he" is wealthy. He reassures me we are one but the fact remains that all savings are in his name (bar what I have).

I feel insecure and a bit vulnerable seeing my savings and pensions stagnate and if he left me, I'm a bit f***

You need to start earning. SAHM is not for the modern age.

I would go back to work - yes you could get a chunk in a divorce but divorces don't necessarily get finalised quickly and you need to survive in the meanwhile. Being a SAHM is risky.

The other thing he needs to think about is the pension you'll have after retirement and how it's taxed. If it's all in his name, you'll be taxed more as a couple as you won't be using your tax free allowance and basic rate allowance. Given his high earnings he also needs to consider the lifetime allowance. Makes much more sense to split what's going into your pensions as much as possible. Obviously how much you can put in and get tax relief on is capped at £2880.

You need to get online and start educating yourself on where you stand (to be fair i wouldn’t know in your position either )

have you got a will ?
where are all the papers filed ?
have you got a state pension and can you pay into national insurance ?
had he got a death in service scheme and a will
and do all pension schemes cover widows ?

and maybe do some research into family law if what he says is true about his pension
eveything is available online if you look hard enough

And plan to work

I’m sorry I agree that sahm is risky these days

@Sahlives

OK - you don’t need to panic. It isn’t dire, and some of what you feel is irrational.

You are married. If your H left you - his and your savings would be combined and divided 50/50.

It is not a myth. It is what happens.
I have been a SAHM - with high earning H. Most things were in his name - and it didn’t matter. It was shared fairly and equally.

Why are you suddenly so worried about your marriage’s future? Has something happened?

The only thing i do wonder about is why your H isn’t optimising taxes - and why he wont put money into ISAs for him and you. As that is just a smart thing to do. And it may make you feel better about having savings on your name too.
Rather than demand access to his saving’s account - i’d start there.

Tbh, I doubt you need to worry too much financially.If he funds you well to be a SAHM, shows no current issues with financial abuse, then you are probably OK. If you split, as he says, you'll likely get half of his substantial savings anyway.
However, being a SAHM might induce a sense of identity loss and its probably better for personal balance for you to keep your hand in the world of work. Make sure he pays the child care while you work whatever hours suits you - he can afford it.
Overall, don't worry but maybe just aim for more than motherhood, he should support you to do both work and look after the DC, ideally by stepping up himself, but if not the by paying others to enable you to do what you like.

☹️ Looking after your own children is not for the modern age? Who benefits from childcare being outsourced to minimum waged staff answerable to timesheets and tick boxes? Not to say they don't nurture, of course they do but we all know the difference between an employee and a mother, and yes, we ALL do our best.

There's no right answer, but devaluing mothers is not the way, their nurturing cannot be replaced. Demand more rights for SAHM alongside increased status in parallel with the rights of working women, including those in the childcare sector.

Your situation is not dire. You're married, as a family you're doing well financially and it sounds like there will be significant assets to be split in the event of a divorce. How is your marriage generally, are there aspects that would make you feel so worried?

I am a sahm and my husband is on a similar salary to yours. He tops up my pension because it's tax efficient (or rather, I do it with his money). We don't have a joint account and all our savings and investments are under my name. Would that make you feel more financially secure? It is set up this way for us because my husband has no interest in managing our finances and trusts me to do it. And I know he truly values me being a sahm from things he have said and done over the years... for instance when we were reviewing his insurance policies he told me to redo mine too as he said there is definitely no way he could continue working the way he does now if anything happened to me.

Goodness did you find it hard to homeschool? As of course, your role in educating your children can’t be outsourced to a mere employee. You don’t want employees caring for your children for much of their waking hours from 5 - 18.

Presumably you also struggled with outsourcing the key parental role of providing for
your children to your husband? It must be hard to give up those sort of essential parenting tasks - feeding, clothing and sheltering your offspring.

Well said.