I'm always finding interesting things in my email box. A few details in this Q&A were changed to protect the innocent.
My physician friend is married to a previously high earning executive husband who was downsized 18 years ago and never found similar work again and refused lower paying jobs. He “borrowed” money from her to start a rutabaga farm on their large acreage but it failed. She states they agreed he would use the loan and his social security payments (his pension and severance are long gone) to cover the expenses of their acreage and huge luxury home. The plan was also to downsize about now if he could no longer afford that.
She feels until they downsize from it she will have to continue her work as an emergency physician. She feels that he gets to be Grandpa on their luxury farm but she doesn't have the money to retire to travel as she wants to do with “her” money and can't even afford to stay home and be Grandma like he gets to. She feels betrayed and that he broke a promise. Her friends, including me, think he has been depressed these many years and that she can't start being tough now after letting things slide all this time, and she of course can't just let the big house rot by not paying the upkeep/utilities. Of course, they also made a lot of mistakes along the way like private colleges for four kids and the luxury home.
There are a number of financial solutions to these issues but they all start in the office of a marriage counselor, preferably with both spouses present. First, I'd like to make a few general comments, then I'll discuss a bit of specific advice.
Gotta Be On The Same Page
In my experience, it is exceedingly rare for a married couple to be financially successful if they are not on the same page. In this case, it doesn't sound like either of them has any kind of a real financial plan. But even if one of them did, it doesn't do any good unless the other one buys into it. It only takes one spouse to ruin even the best financial plan.
Finances Just A Symptom
In this case, as in many others, financial problems are just a symptom of the real problem. The real problem here is that these two spouses haven't learned to communicate with each other very well. The financial problems can all be fixed to a certain extent, but it will require a major commitment from both of them to do so.
No His and Hers
In a couple that is managing money well, there is no “his money” or “her money” or “borrowing” from one spouse to another. There is only “our money” and to be successful, both will be involved in managing it, at least with regards to the big decisions.
The Physician's Husband
I have had a number of financial advisors comment to me about how often female physicians marry “real bums” who are just looking for a “sugar momma.” I have no idea if the percentages are any higher with female docs than male docs, but it obviously happens both ways. Some of the solutions to this problem involve proper selection of a spouse, but a good part of it is being a good spouse. That means setting limits and boundaries and having an appropriate relationship.
It isn't about “being tough.” It is about combining both of your hopes and dreams and working together toward those goals. It's a conversation about what you both really want out of life. She clearly does not care as much about a lot of acreage and a luxury home as she does about retiring, spending time with the grandkids, and traveling. She is unhappy because her finances and time are not aligned with her priorities. We don't know if he is unhappy, since at this point readers are getting this story at least 3rd hand. But if he is clinically depressed, part of the “boundaries and limits” is going to involve him going to get professional help.
Financial Steps To Take
Once both of these spouses can get on the same page, they need to align their financial life with their priorities. If the priority is to get her to retirement ASAP, here are the best steps to take:
- Get on a written budget. They should look at everything they spend on and determine if that is more important to them than retiring earlier.
- Get a financial plan. Presumably getting on a budget will free up some investment capital and it needs to be invested wisely. Chances are good this couple will need a good financial planner. If they were going to do this themselves, they would have done it a long time ago.
- Sell the house and acreage. Better to sell now than be foreclosed later, and this should free up an immense amount of capital to invest for retirement. Downsizing probably isn't even optional and the sooner it is done, the better, as discussed here.
- Stop living like a doctor. Your friend can't go back and undo private schools and the luxury home, but you can start making smart decisions going forward. She cannot live the same lifestyle as her colleagues who have been making smart financial decisions for 30 years. If she tries, her financial situation will continue to spiral downward. The good news is she still has the ability to trade her time for money at a very high rate as an emergency physician. The bad news is she won't be able to do that forever.
- Send him to work. Nobody is ever going to pay him what he was making 20 years ago. But that hardly means it isn't worth him working at least part-time. It will do wonders for his self-esteem, perhaps he can stop his Social Security payments in exchange for a higher payment later, and it will certainly allow her to cut back a bit. Even a few shifts makes a big difference for an emergency doc. I'm a big fan of stay at home parents whenever possible. But a stay at home grandparent in a family with serious financial issues? Not an option barring disability.
- Delay Social Security. It sounds as though he is already on Social Security (or perhaps disability payments.) The standard advice for those with inadequate retirement savings is to work as long as you can and delay Social Security until 70. That's probably good advice for her. But even going part-time would help with the retirement savings while allowing some travel and grandma time.
What do you think? Have you seen friends and colleagues with issues like these? What would you recommend? Divorce? Counseling? Hiring a financial planner? Selling the house? Do female physicians marry guys looking for a sugar momma more than their male colleagues do? Comment below!