Pay Dirt is Slate’s new money advice column. Have a question? Send it to Athena and Elizabeth here. (It’s anonymous!)
Dear Pay Dirt,
I have a high-earning job but struggle with depression. I need to live with other people just for the social pressure of needing to shower. I own a three-bedroom, two-bath condo in the heart of downtown. One bedroom is my office. “Yuli,” who lives in the guest bedroom, came to me because a friend of a friend knew they were homeless, and I needed a roommate. We lived together for three years in harmony. I asked Yuli a third of what a roomshare goes for in our city because they are clean, a good cook, and understand when to press me to get me out of my head or to leave me alone.
Recently, my younger sister got tossed in the streets after her boyfriend bailed on rent. Her options are move home, where she hates our stepfather, move in the suburban hell with our sister and her babies, or stay with me. I offered to put her up free for six months on an air mattress in my room. She declined because she “deserves” her own space and wants my office. I start work at 5 a.m., and my sister is notoriously hard to wake up. The living room wouldn’t work because my sister is a slob and it is the only communal space in the condo. My sister wants me to kick out Yuli for her. She says I “owe” her because I am her family, she is technically homeless, and Yuli is on a month-to-month lease with me. She says if she goes home, our stepfather will “abuse” her—meaning they will fight like cats and dogs. Our lives growing up were not easy and left scars, but am I wrong for not throwing Yuli under the bus for my sister? My sister makes me want to break out in hives, but she is my baby sister.
—What I Owe
Dear What I Owe,
Ah, family drama. There’s nothing quite like it! The short answer is no, you don’t owe her anything, and you shouldn’t kick out Yuli.
Your sister sounds like a hot mess. Sure, it’s not her fault she’s experiencing homelessness—people who bail on rent suck. But that doesn’t give her the right to dictate your living situation. Plus, you said her boyfriend bailed on rent, not her ex-boyfriend, so I’m wondering if they are still together. If they are, that makes complete sense as to why she is demanding her own room and is refusing to go home. It’s harder to have a love shack when you’re sleeping on an air mattress in your big brother’s room or under your parents’ roof.
Her sense of entitlement is impressive. You are offering here a free place to crash, and she wants to kick out the person who pays the bills and makes dinner and immensely helps your mental health? Girl, bye. If you’re able and feeling generous, you could offer to subsidize a rented room elsewhere for a month or two. But just because she’s family doesn’t mean she gets a veto over your life choices, especially those that help keep your depression in check. Be polite but firm with your sister about her options. You’re not wrong for protecting your own stability first.
Dear Pay Dirt,
Due to a catastrophic event that befell our family, we had to sell our house, which was awful and heart-wrenching, but there was an upside: We made a decent profit on the sale and are sitting on a substantial chunk of change. We are now in a much more stable position financially, and so far we haven’t touched this extra cash. And by “haven’t touched,” I mean it’s literally sitting in our checking account, making no interest for us. At the moment, I am absolutely terrified of doing the wrong thing with this cash, either by losing this money in a stock market drop or putting it down on another house and having zero cushion left if another crisis should arise. We don’t have much in the way of savings or retirement and will need to worry about college for our kid eventually. We are currently back to renting.
My partner and I both grew up very poor and don’t have great money management skills, so their strategy for now seems to be not talking about it at all, which means I kind of feel like I have to take this problem by the reins and figure it out. Where do we go from here? Who can I trust to help our family through this challenge, as I don’t even know what kind of financial professional to reach out to for advice?
Dear Frozen Assets,
I’m so sorry about the circumstances surrounding this windfall, but there is so much that you’ve done right that I want to acknowledge that first. Kudos to selling your house in a seller’s market, and kudos to you for sitting on that nest egg until you figure out your next move. Security in any economy is important, especially when you had a financially unstable childhood then experienced a catastrophe as an adult. Your comfort level may tell you to hoard that money with good reason, but your instincts to call in the professionals are correct.
First, you need to make sure your family has an emergency fund set aside in case another urgent need arises. Most financial experts recommend three to six months of living expenses or a sum of about $10,000. I would choose whichever you feel works best for your family. This money should be earning interest, but you also want to keep it liquid, so it should live in a high-yield saving account. Banks are always offering competitive rates, so I’d look around and find one that feels most comfortable. Factors to keep in mind would be how much you make on interest, whether the bank has any local branches, and how much cash you can access in any given day.
Next, meet with a financial adviser. A common misconception with financial advisers is that you already need to be wealthy or have a high income. This isn’t without merit, as a lot of advisers do make money off of what they can sell you or how much of your portfolio they manage on your behalf. You’ll want to look for a “fee-based” financial adviser, which means they will charge you per consultation while advising you on how to invest your money. They can personalize your plan with regard to your retirement, college funds, and any additional financial goals you may have. You can schedule an annual check-in or just use the tools they will share with you to manage your money yourself. The Garrett Planning Network is one resource for finding a fee-based adviser close to you and has tips to help you get started. Seeing a financial adviser is like getting a physical at the doctor’s office: At first you may feel overwhelmed and not want to go at all, but once you do, it isn’t so bad. You can share any issues you have, and you’ll hopefully leave feeling like a million bucks.
Dear Pay Dirt,
My fiancé and I have been together for almost seven years. We met shortly after he graduated from law school. He had just relocated back to our college town for his first job. I stayed after accepting my first job straight out of college, three years prior, and had just paid off my school loans. We’re getting married in September, and there’s one thing that keeps bothering me: his law school debt. He makes good money but has over $100,000 in government-funded loans. I’m debt-free, and we’ve recently started our financial journey together by opening a joint savings account. Will I be tied to or responsible for my fiancé’s large amounts of loans he has once we are married?
—Love Not Loans
Dear Love Not Loans,
Congratulations on your upcoming nuptials! Any debt your significant other has before you are married is considered solely his debt. Since all of his student loans were acquired before you two decided to walk down the aisle, he’s on the hook for them, not you. This also includes any other type of debt either one of you took on individually pre-wedding. If you two decide to take out a loan (such as a mortgage) together after your ceremony, both of you would be tied to it, and you both would be responsible for the balance.
However, I am wondering if you could impact his loans after your nuptials: If he is on an income-driven repayment plan, your combined incomes after marriage may drive up his monthly loan payment. It depends on which type of repayment plan he’s on, but I’d have him research it, so you can plan ahead and don’t receive a surprise bill after the wedding. It also might be worthwhile to talk to a financial planner together to figure out your joint budgeting and saving strategy, since those loans will affect future financial plans.
Dear Pay Dirt,
For the first 20 years of my adult life, I paid my taxes every year on time and without fail. Then five years ago, I was the victim of identity theft, and my refund was stolen. I never got that refund, and the following year my father passed away suddenly, which put me in a deep depression. I have attempted to pay my taxes but could never locate the special PIN that the government is now issuing me (a new one every year, another piece of paper to keep track of), and now it’s going on four years that I have not filed. Where do I start? On the surface, I seem to be a competent, educated person, but I am embarrassed that I can’t get my paperwork together and that this has gone on so long. I am single, no dependents, and have never made over $50,000, so it’s not like it’s too complicated, but also I do not have a ton of cash to pay someone to help me. Do I contact one of those tax services you see advertised? Go directly to the IRS? Why is this part of adulting so seemingly inaccessible?
Dear Taxed Out,
Both of those events sound traumatic, and I’m sorry for the grief they’ve caused you. But you have no reason to feel embarrassed. Your brain probably associates tax time with that trauma, so it makes complete sense as to why you are avoiding this. The good news is that you are still a competent person—you just need a little bit of help to get this on the right track.
I would like you to go to the IRS website and read about its Volunteer Income Tax Assistance program. It was created for people just like you who do not make more than $57,000 and need assistance with their taxes. VITA programs are in every community and are staffed by people who are trained by the IRS in helping you prepare your return, sort through any issues you may have, and file—all for free. You’ll want to take your 2020 paperwork; mention that a previous refund was stolen, that you can’t find your PIN, and that you haven’t filed in a few years; and ask how you can get back on track starting with this year’s return. They should be able to help you get the assistance you need without making you feel overwhelmed. If you’re not able to get a VITA appointment before the Monday filing deadline, you can go to the IRS website and file an extension. This extension does not hurt you and will allow you additional time to file without feeling rushed. You got this.
More Advice From Slate
I am 23 years old and a graduate student. I am somewhat concerned about my financial habit surrounding porn. I do not think I am going overboard when it comes to paying for the content I like and enjoy, but it still makes me wonder whether I am wasting more in the long run instead of using the money for other more necessary things. My current porn consumption is about $100 a month, allocated between two OnlyFans and Patreon subscriptions. I know I could be saving this money for essential groceries and such, which for me as one person can cost usually $100-to-$150 a month. I am currently employed through my school in a part-time job, and make a fair wage along with scholarships, grants, and loans applied to my savings. I don’t burn through my money (although I do tend to spend a bit more on nonessentials when I am unemployed) but I still feel guilty for allocating this much money to support the porn creator and receive their content that I enjoy.
Does it sound like I am being irresponsible with my money? I want to keep supporting this person, but I dread the day if or when it becomes financially unfit for me to be purchasing this nonessential good, and I don’t know if I am already there or not. One way I have looked at it is that if I spend roughly $100 a month on this person’s content, I spend $1,200 a year, and I have been subscribed on this price tier for about a year and a half. Part of the problem is that, while I thoroughly enjoy this person’s content, I often find myself spending more time with other porn outlets that I am not paying for (all consensual and 18+ videos of course). And, while I spend most of my money on this content creator that I do very much enjoy, I often defer my allocated porn time away from their content for a later date. I tend to think of it like I am paying for my porn and supporting the content creator that I like, but consuming more of the industry through “free” outlets like Pornhub. Am I going about this in the wrong way? Am I simply making excuses for my porn consumption? How do I know if/when this becomes an unhealthy habit financially?