Pay Dirt is Slate’s money advice column. Have a question? Send it to Athena and Elizabeth here. (It’s anonymous!)
Dear Pay Dirt,
I’m a dude, age 31. He’s 28. We’ve been together three years, cohabitating for two. I recently asked for his ring size.
His finances: minimal assets, $100K–$150K student debt (federal, now in income-based repayment). Rough upbringing. Previously, income struggles. Lately, $70K-a-year salary, with growth potential. His mom (of whom I’m skeptical) might expect him to care for her one day.
Me: grad student, previously high-income, maybe will be again. Living off savings. I haven’t told him how much, just that it’s enough to cover my bills until I work again.
He’s said he’s OK with a prenup specifying that his debts stay with him and any savings that I have left after paying for school stay with me. But he doesn’t know that I have more than $1 million in my brokerage accounts.
Should I, and when do I, and how do I, bring this up? There are reasons I’ve stayed quiet about it. I don’t want to be a sole provider, finance our first house alone (that’d take assets that would otherwise remain with me in the event of divorce), or expand our modest lifestyle. I don’t want my money to change things between us.
—When Do We Talk About This?
Dear When Do We Talk About This,
You have to talk about this now if you plan to get married—not because it will change things between you, but because a failure to disclose something that could meaningfully shape the direction of your lives will erode trust between you.
I would not assume your boyfriend would expect you to be a sole provider, or otherwise expect your roles to change, if he had this information. Between the two of you, he’s the one with the job, so it seems a little presumptuous to take it for granted that if he knew about your money, he’d want you to financially support him. He may in fact find that idea insulting, especially if he put himself through school after what you characterize as a “rough upbringing.”
But regardless, you need to talk about these things before you pop the question, because this is also about what you want for your respective futures and your potential future together. And you need to consider the possibility that at some point, the shoe might be on the other foot. Just because you’re in a better financial position now doesn’t mean that will always be the case. It’s not uncommon for incomes to shift in marriages where both parties work. You would want him to be transparent in that situation, so you should be transparent with him now.
Dear Pay Dirt,
I’m a senior in college, set to graduate in the spring of 2022. I plan on going to grad school, but will be taking at least a year off before doing so, for a much-needed and parent-encouraged mental health break. I’m definitely in the upper part of “upper-middle class,” and have about $10,000 in my savings account, though about half of that is from an account my mom set up many years ago, and I’d ideally like to put that money elsewhere.
I know I can live with my parents after this year (but that’s suburbia and I can’t drive), or possibly with friends (would be in a capital city in the South), and I’d definitely like to look into some kind of employment, though I’m unsure if that will be full or part time, since I do want to rest and actually enjoy life a bit.
Do you have any advice on things to be doing and considering during my gap year between undergrad and grad school, so that I start on the right foot financially, for grad school and whatever else comes next?
—Almost Done, for a While
Dear Almost Done,
It sounds like you’re already being thoughtful about what you need to do for yourself to succeed and be happy, and you also realize that you’re lucky that you get to do it. That puts you well ahead of many of your fellow soon-to-be graduates.
You should use your gap year to explore your own interests and think about how they might intersect with what you want to do long term. I don’t think future employers or graduate schools would hold a year off after school against you in the same way that they might frown upon a large employment gap otherwise, but if you had planned to take advantage of your school’s career resources to job search or facilitate a grad school application, they may not be available to you after you’ve graduated.
I think it is important to be able to explain what you did with that year if you plan to return to school, but I don’t think that means you have to structure the entire year with an eye toward making it look good on a grad school application. You simply need to be able to explain how it helped you grow personally and/or professionally.
If financial preparation is important to you, you probably do need to find employment. Your $10,000 is a nice cushion, but it’s not going to give you total financial security over the course of a year. (Keep it in a low-risk account, and please do not buy an NFT with it!) But you can build your savings at a nice clip if you don’t have to pay for housing, so if living with your parents is an option, and they genuinely don’t mind it, doing it for a year might be the best way to give yourself some financial breathing room, and more options when you do return to school.
Dear Pay Dirt,
I soon will be receiving a significant legal settlement (about $1 million) that I don’t know what to do with. I’m in my early 30s, have well-funded retirement and savings accounts, and a very manageable mortgage with no other debt (I realize how lucky I am). My spouse and I have discussed cashing in the roughly $600,000 in equity on our home and using some of the settlement to buy a new, nicer house. This sounds great, but we live in a major city where home prices have skyrocketed—as in, it will easily cost $1.25 million to get a decent place. Is it a terrible idea to buy real estate in the middle of a possible (likely?) bubble, even if you can afford it? Would I be better off sitting on the money for a few years and hoping that prices come down?
—Our Timing Is Terrible
As with everything, this sort of depends on your individual preferences right now. If you’re thinking about this question like an economist, you want to be able to define how much satisfaction a newer, nicer home would give you right now versus what you’d be able to buy in a market that isn’t overheated later.
For some people, it might be worth paying a premium to live somewhere nicer as soon as possible. For people who are more ambivalent about moving, or don’t feel any urgency about it, a nicer home might be something you’d put off till later so that you get a better bargain. So the real question is, how badly do you and your spouse want or need a newer, nicer house? How much satisfaction would you derive from having it now, instead of, say, in five years? Or 10 years?
You’re also taking a risk in presuming that home prices will eventually come down, and as a resident of New York City, I have to warn you that this particular assumption might be overly optimistic.
So there’s no literal formula for making this decision, but here’s a sort of abstract one: How would you value the utility or the satisfaction you’d get from having a newer home now, versus having one later? Can you put a dollar amount on it? And is that amount larger than what you’d save if you waited, given your educated guesses about what you’d be able to get later? There’s no right answer here.
You also want to look at other considerations that have to do with timing and your finances now, by the way—tax implications, your ability to get financing, etc. But it really is a matter of deciding exactly how important having a new home is to you.
Dear Pay Dirt,
About 10 years ago, my father gave me a modest amount of silver and gold coins—140 troy ounces of .999 fine silver, and 2 ounces of fine gold. At the time, my mother was entering a nursing home, and my father was terrified he would lose all his money to pay for her support. I didn’t know what to do with the coins, so for years I kept them in my freezer (I heard that would keep them safe from fire), and then eventually transferred them to a safe deposit box.
I have heard that silver and gold coins do not appreciate reliably. What should I do with them? Let them sit in the box? Cash them out? How do you cash them out and know you are getting a fair price?
—I’ve Got This Treasure
I would suggest getting the coins appraised by two or three different coin appraisers (yes, this is a real job) to determine what the value is. Look for companies that have experts on staff with certifications from major industry trade groups like the International Society of Appraisers.
If the coins are very rare, you can pay to have them graded, which helps value them for the collector market. It sounds like you have no plans to become a professional collector, though, so what you really need to understand is the fungible value of what you have. Many appraisers will offer verbal appraisals for free, and you should be able to triangulate on the approximate value of what you have if you talk to a few reputable numismatists. The International Society of Appraisers helpfully provides a search function where you can find member appraisers in your area. Go ahead and find out so you know what to do next.
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