He invested 350k in the stock market without my knowledge or consent!

[burning 4 revenge]

He invested 350k in the stock market without my knowledge or consent! I have begged him for years to pay off the house. Yesterday, some e-trade tax documents arrived. I knew he invested and lost about 100k a few years ago. He admitted that last year- but his purchases equal 350k and his losses are over 200k !!!! I begged him a few years ago to STOP and to start paying off the house.

He's insane. Meanwhile, he has 10k in his checking account, 3k in savings and

we owe 159k on our house (not upside down). I am terrified and FURIOUS. He seems to be investing his entire paycheck minus living expenses (about 4k per month) into the stock market!!!!!

I need advise from folks in CALIFORNIA who know if there is a law in the divorce codes about a spouse being compensated when another spouse goes crazy and invests/loses all their COMMUNITY PROPERTY. We have always had separate bank accounts. I make about 30k per year and he makes 150k per year. I had NO idea...

Thanks.

Why do you say its your community property when you have seperate bank accounts ?

 

Is that California law?

 

This guy should have gotten a Pre-nup

[carhill]

Tell me about it

 

Yes, in Cali, it's 'community property', ergo 50/50. In her area, the COL will likely dictate substantial spousal support as well. The court just crunches numbers. There's a place on the FL100 for petitioning the court to waive spousal support, but that would only be upheld in an uncontested action, IMO. I trust she'd contest

[burning 4 revenge]

Tell me about it

 

Yes, in Cali, it's 'community property', ergo 50/50. In her area, the COL will likely dictate substantial spousal support as well. The court just crunches numbers. There's a place on the FL100 for petitioning the court to waive spousal support, but that would only be upheld in an uncontested action, IMO. I trust she'd contest

Any man of means who doesnt get a pre-nup is walking into a minefield in this society

 

Im not a man of means so Id look like George Costanza asking for a pre-nup, but if I had assets and was getting married Id definitely get one

[carhill]

IMO, anytime there's a substantial difference in net worth, a pre-nup is in order. Someone can only take so much of my life's work before I'll never get it back through earnest effort. No future marriage will be without one, no matter how poor I currently am. It provides agreement and protection for both parties. Smart

[Angel1111]

He should consult with her because they're in a marriage, and he's making huge financial choices that affect both of them.

 

I agree, and I think this is the crux of the problem. When I was a kid, I remember my mom and dad talking about finances and property, and I specifically remember my dad wanting to know my mom's opinion and listening to her. They valued and respected one another and couples who feel this way about one another, do not do huge things like this behind one another's backs.

 

Aside from that, OP's husband may make a good living but he obviously has no financial sense. Anyone would know to pay off their debts first, have a substantial savings account, and then do the risky things he's doing. If those risks pay off, great. If they don't, they're not wiped out.

[phineas]

The whole story isn't being told.

People don't just start tossing money like that into the stock market.

I have a feeling her husband was doing this when she met him.

[carhill]

Maybe he's investing in 'shoe futures'

[someotherguy]

He "obviously has no financial sense"?

 

Seriously?

 

You write off a pretty decent percentage of your interest payment on your home every year, so if he has a mortgage at say 5% apr, he's effectively being loaned $159k at something like 3.5% interest. Where the hell else are you going to get that kind of rate?

 

He's much better off using his money to invest in something with an average return of 7% (the stock market, historically).

 

Borrow at 3.5%, invest at 7%, reap the rewards of the margin, that's called arbitrage, and it makes excellent financial sense.

 

Obviously, some investments can go bad, or take time to rebound, that's part of the risk associated with a fluid investment market.

 

It sounds to me like OP is pissed that the house isn't totally paid off so she can kick him out and keep it all to herself free and clear.

 

And who's to say he doesn't have healthy IRA and 401k balances? She doesn't tell us anything about those, and I would safely assume he is investing heavily into his 401k through his employer, as their matching programs tend to be excellent for those above the 6 figure earning bracket. Deferred compensation, anyone?

 

I would also wager that the husband has been making the vast majority of the financial decisions in this marriage for a long time, and the momentum is there for him to continue doing so. Frankly, she makes $30k a year, it doesn't take a lot of savvy to manage your investment options at that kind of income, as it generally consists of putting a few bucks every week into a low interest bearing checking account.

[phineas]

The OP doesn't mention a pre-nup.

I'm wondering if there is one.

 

If both parties were making similiar money then OK I can see discussing it.

Even with his inflated salary it sounds like bills are being paid & nobody is going hungry.

But the amount of money he's making is so far above her & me & anyone I know so I can't even fathom cashing his paycheck or what i'd do with that kind of bank.

[Angel1111]

Yeah, he's a real genius:

 

- he invested and lost about 100k a few years ago

- his purchases equal 350k and his losses are over 200k !!!!

- 10k in his checking account

- 3k in savings

- we owe 159k on our house (not upside down)

- He seems to be investing his entire paycheck minus living expenses (about 4k per month) into the stock market!!!!!

 

Being able to write off interest payments on a house is not necessarily a smart move, particularly when you have money to pay it off. Plenty of financial advisors will tell you this. It's not a new concept.

[lkjh]

I agree, and I think this is the crux of the problem. When I was a kid, I remember my mom and dad talking about finances and property, and I specifically remember my dad wanting to know my mom's opinion and listening to her. They valued and respected one another and couples who feel this way about one another, do not do huge things like this behind one another's backs.

 

Aside from that, OP's husband may make a good living but he obviously has no financial sense. Anyone would know to pay off their debts first, have a substantial savings account, and then do the risky things he's doing. If those risks pay off, great. If they don't, they're not wiped out.

 

 

Thats great for your parents but that doesn't mean there is only one way of doing things. Also, you have no idea if your parents kept secrets from each other which more than possible.

 

You can be mad that the guy didn't ask his wife for permission first but if he makes a good living, pays the bills, supports his family, and still has enough left over to invest 300k in this economy than he must be doing something right

 

 

I am curious if the scenario was flipped and he asked his wife for her input and she said no would you be ok with him doing it than? Or would he have to succumb to what she decided?

[lkjh]

Yeah, he's a real genius:

 

- he invested and lost about 100k a few years ago

- his purchases equal 350k and his losses are over 200k !!!!

- 10k in his checking account

- 3k in savings

- we owe 159k on our house (not upside down)

- He seems to be investing his entire paycheck minus living expenses (about 4k per month) into the stock market!!!!!

 

Being able to write off interest payments on a house is not necessarily a smart move, particularly when you have money to pay it off. Plenty of financial advisors will tell you this. It's not a new concept.

 

Actually pretty much every financial expert has recommended investing now. every single day financial advisor has been saying if you have money now is the time to buy real estate and last year was the time to buy stocks

 

Your problem isn't with his investment its with the fact that he did something with out his wife's ok.

[Angel1111]

Your problem isn't with his investment its with the fact that he did something with out his wife's ok.

 

Actually, I take issue with both - his lack of investment sense, and his disrespect toward his wife.

 

As far as my parents are concerned, the only point I was trying to make was that couples who are respectful of one another do not make major decisions without their partner. If they have so little respect for one another, they don't need to be married. If one spouse just doesn't have the understanding of finances or real estate or whatever the issue is, and they agree that the other should have carte blanche on those decisions, then that's great. But I don't get the impression that the OP and her H have come to that type of agreement.

[LisaUk]

Men are constantly bashed in the media, don't get all high and mighty here. Once again, insulting.

 

I just want women to reap what they've sown: equality. You say you're equal, then fine, start acting like it. Actaully, if you read my post again, I think you will find I did NOT say women were equal. In fact that was the crux of my point, the fact that women aren't equal. It's why the law is biased in favour of the women. I'm not saying it wouldn't aplly to a man in a sterotypical situation of a women, if a man has sacraficed his career and stayed home to run the household and raise the children i.e. contributed to the household in an indirect way, mainly through unpaid labour, then I would say exactly the same things. It is the contributions made, not in a financial way, that puts (generally) women, in the unequal position, which is why the courts are biased towards them when it comes to the division of assets.

 

She wants to have some mystical right to every cent he earns? Then she better be earning it...one way or another. And making sandwiches seemed less offensive than other suggestions I could have made. Again, really offensive.[/QUOTE]

 

There you go, lump all guys into the 'weirdo' category, you fell right into that one.

 

Crime statistics actually show children are safer now than ever before in history, so there is absolutely no basis for that view. It is simply a view pushed by the feminist agenda to tear men down.

 

So, when the rare woman supports her man, it's out of the goodness of her heart, but it is expected out of men? Talk about a double standard.Er, no, I think the point is if a women supproted fiancially and the man ran the house then he should revieve in the same way a women does in court and in fact they do!

 

As long as we're talking equality, how about equality in the courtroom when it comes to divorce? I have firsthand knowledge that there is no equality there. Every child born during the marriage is assumed to be the husband's, and he is responsible for them financially. The wife is assumed to be deserving of at least half of the marital property regardless of who contributed to it's acquirement. The wife is assumed to be deserving of maintenance/support/alimony regardless of her education of earning history, as long as she doesn't make multiple times the husband's salary. The wife is assumed to be deserving of full custody and the husband has to fight for the right to even see his children, let alone receive appropriate amounts of custody.Firstly, the priority of the court is to ensure that minors are looked after, if it is the women who has stayed home and raised the kids thus far, then obviously the court want the min distrubtion to their lives, hence, the custody. Secondly, all the other things, about perternaty etc are all what's called rebuttable presumptions. That is to say, if you beleive the children aren't yours the court can and will order DNA testing. Similarily, if you can produce evidence of your wifes' "extra-material" activities and present a strong argument that she has delayed on financial grounds, the court take that into account, when assessing "the whole course of conduct in realtion to the parities", in proportioning assests and making financial provision. Certainly that is English law (I know b/c I am in the acedemic stage of training to become a solicitor, lawyer). So, yes the courts are biased towards women, the have to a place to start and unfortunately women generally are the weaker partner in terms of earning capacity in a marriage, for the reasons I have alreday stated. Howver, if you can produce evidence to the conteray, that will ajust the proportions accordingly.

 

"Community property" and "no fault" are sexist nonsense designed to ensure women come out on top of men in divorce. I think I covered this above.

 

This may read like I'm terribly bitter, but I'm actually not. The simple reality is that the legal system is extremely biased in favor of women in many respects, divorce law being particularly skewed.

 

When I decided I was done with my sham of a marriage, I went down to the courthouse and found out that the divorce paperwork is all worded to assume the wife is actually the one filing, and I was the "respondent", even though my wife refused to give me the divorce for over a year, she was more than happy to screw around on me while I paid all the bills, did all the housework, and cared for the children. Because she refused to work, even though we agreed before we married she would, it fell on me to finance the entire divorce process, including all her legal fees. Sounds awesomely fair to me. I seriously considered moving to a state with a fault clause and establishing residency just to totally screw her over, but I couldn't find a suitable job due to the economy, and I didn't really want to lose my friends and move away from my family.

 

Anyway, back to the OP, I don't want to threadjack.

 

It sounds like some serious communication issues exist in the marriage, perhaps counseling could help?

 

Have you actually talked to him about this, or are you just looking for an excuse to get a divorce? You did make some serious vows about "good times and bad, richer and poorer, etc" remember?

 

I'm sorry you have had a bad experience when it can to your divorce, however, I am sure you can appreciate that every case is different and that is why the courts start from that perspective and adjust it with evidence rebutting those presumptions.

[lkjh]

Actually, I take issue with both - his lack of investment sense, and his disrespect toward his wife.

 

As far as my parents are concerned, the only point I was trying to make was that couples who are respectful of one another do not make major decisions without their partner. If they have so little respect for one another, they don't need to be married. If one spouse just doesn't have the understanding of finances or real estate or whatever the issue is, and they agree that the other should have carte blanche on those decisions, then that's great. But I don't get the impression that the OP and her H have come to that type of agreement.

 

You are letting your anger over the fact that a man made a decision with out his wifes ok cloud your train of thought. One secret does not determine if a spouse respects or disrespects their SO. Ever couple has secrets and 300k may be a lot to you and me but it may be nothing to her H. He may be capable of replacing that in a year or two. Maybe the op has no financial sense what so ever and he knew she would disagree. Considering the fact that she wants to pay off her house in one shot and spend their savings doing this is not a wise choice. With everything being down they can turn 200k into 400k in 2 or 3 years, but paying off their house won't mean much considering the fact that housing will stabilized but not sky rocket the way it did in the past 5 years. So whether the pay the house off now or in the next 7 years doesn't matter, but why miss out on a chance to make a serious investiment?

 

Do you hold this much anger when a woman spends money with out her SO permission? Do wives need to ask their H's if they can buy cloths they don't need? If a wife max's out a card with out her H's permission is that ok?

 

You didn't answer the question, if he talked to his wife first and she did not agree with the move than what should have been done? Should they invest the way he wants to with the money he earned or should the pay off the house because thats what she wants?

[lkjh]

I agree with the fact that if women want to be treated equal(which is their right) than they must apply that to all cases. If they don't make the equal amounts of money than they should have the final say. I am not saying that the op should have no say but why does she get to determine how her H's money gets spent?

[LisaUk]

You are letting your anger over the fact that a man made a decision with out his wifes ok cloud your train of thought. One secret does not determine if a spouse respects or disrespects their SO. Ever couple has secrets and 300k may be a lot to you and me but it may be nothing to her H. He may be capable of replacing that in a year or two. Maybe the op has no financial sense what so ever and he knew she would disagree. Considering the fact that she wants to pay off her house in one shot and spend their savings doing this is not a wise choice. With everything being down they can turn 200k into 400k in 2 or 3 years, but paying off their house won't mean much considering the fact that housing will stabilized but not sky rocket the way it did in the past 5 years. So whether the pay the house off now or in the next 7 years doesn't matter, but why miss out on a chance to make a serious investiment?

 

Do you hold this much anger when a woman spends money with out her SO permission? Do wives need to ask their H's if they can buy cloths they don't need? If a wife max's out a card with out her H's permission is that ok? I agree here, it goes both ways, personally I never spent money without discussing it with my ex first and I have a real problem with secret keeping. I have read about women who go shopping and then lie about it to their H, I personally find that completely morally reprhensible. But the same applies to him and his earnings. It's about a mutal respect. It's about assimulating your finances together for the benfit of both of you and the family. Just my opinion.

 

You didn't answer the question, if he talked to his wife first and she did not agree with the move than what should have been done? Should they invest the way he wants to with the money he earned or should the pay off the house because thats what she wants? Neither. Marriage is about compromise. the point is, he didn't discuss it with her. ALthough I will add one observation. The OP said they have seperate bank accounts, what's good for the goose is good for the gander, all or nothing in my opinion, you cannot have it both ways. EIther all the money is both of yours or it is seperate, in which case does someone really have the right to get upset when the other spends it? But then again, it is the family home we are talking about, I think the OP feels that that should be a priority for both of them and it's more to do with the fact he did not discuss it, than spending his money.

..........

[Stung]

I make significantly less than my husband does too, as he asked me and I agreed to put my career trajectory on hold in order to concentrate on our young children. Does this mean I have zero input in major financial decisions? He currently pays the entirety of our mortgage, is it alright for him to gamble away our house without breathing a word to me if he feels like it? I put 70K of my own money into the down payment, does that give me more legitimacy in the house? He puts more away towards our retirement than I do, yet I wouldn't like it if he decided to close our retirement accounts and spend the money on a fancy vacation. We don't know the whole of the OP's financial/familial situation, to tell a woman who is afraid for the security of her financial future, who states that due to the secrecy and large amounts involved that she thinks he's actually crazed, to go make her husband a sandwich...this is incendiary and belittling. They are married, she is objecting to being kept entirely in the dark about their finances, this is not unreasonable. At the very least, because she could be held accountable for any further financial missteps. Now, whether they are actually missteps is perhaps debatable, but just because you might think it's open to interpretation does not mean she has no legitimate cause for concern.

 

Also for the record there are areas of California in which 4K per month would NOT cover a couple's reasonable living expenses, much less a family's. It's probable that the OP is paying into their lifestyle and maintenance as well, rather than just sitting back and enjoying her husband's warm cash flow as some posters appear to believe.

[carhill]

150/12= 12.5K per month, assuming after-tax income. If their housing cost alone (mortgage, property taxes and insurance) is 4K per month, that leaves 8.5k per month. Add in two nice car payments (BMW, etc) and insurance/registration for another 2K per month, leaving 6.5K left. Use half of that, 3.25K, to buy food, toilet paper, razors, wine, gym memberships and the odd Ruth's Chris beef grab. That leaves 3.25K per month for vacations, charitable donations, WAM, the odd mistress and of course H's stock market fetish.

 

No accounting for the wife's income yet....

 

Based on the area and what's owed on the house, I'd say they bought well before the bubble and have over .5MM in equity in their house. Not bad.

 

If they bought the house after getting married, the OP is sitting on a nice nest egg. My stbx would've loved that.

 

No mention of kids, but that of course would skew the numbers. Kids are expensive. Two in day care in the SF area could chew up most of the wife's income.

 

Hope it works out

[lkjh]

I make significantly less than my husband does too, as he asked me and I agreed to put my career trajectory on hold in order to concentrate on our young children. Does this mean I have zero input in major financial decisions? He currently pays the entirety of our mortgage, is it alright for him to gamble away our house without breathing a word to me if he feels like it? I put 70K of my own money into the down payment, does that give me more legitimacy in the house? He puts more away towards our retirement than I do, yet I wouldn't like it if he decided to close our retirement accounts and spend the money on a fancy vacation. We don't know the whole of the OP's financial/familial situation, to tell a woman who is afraid for the security of her financial future, who states that due to the secrecy and large amounts involved that she thinks he's actually crazed, to go make her husband a sandwich...this is incendiary and belittling. They are married, she is objecting to being kept entirely in the dark about their finances, this is not unreasonable. At the very least, because she could be held accountable for any further financial missteps. Now, whether they are actually missteps is perhaps debatable, but just because you might think it's open to interpretation does not mean she has no legitimate cause for concern.

 

Also for the record there are areas of California in which 4K per month would NOT cover a couple's reasonable living expenses, much less a family's. It's probable that the OP is paying into their lifestyle and maintenance as well, rather than just sitting back and enjoying her husband's warm cash flow as some posters appear to believe.

 

She directly says in her original post that he invest his check minus the living expenses. She said he pays them not us. He makes his money and she makes hers, he has a right to do what he wants with his money.

[someotherguy]

LisaUK, I find it unfortunate that you are perpetuating those tired old stereotypes, particularly since you claim to be studying to be a lawyer.

 

Fact: alimony is biased in favor of women.

 

"Thirty-three percent of higher-earning spouses are women, but fewer than four percent of alimony payers are women," says Ned Holstein, president of Fathers & Families, a family-court reform organization in Boston, citing U.S. Census Bureau data.

 

http://www.cnn.com/2008/LIVING/personal/05/22/lw.manimony/

 

 

Fact: women actually earn more than men when adjusted for education, years on the job, etc.

 

But what happens when women make the same lucrative decisions typically made by men? The good news — for women, at least: Women actually earn more. For example, when a male and a female civil engineer both stay with their respective companies for ten years, travel and relocate equally and take the same career risks, the woman ends up making more.

 

http://www.msnbc.msn.com/id/12760790/

 

 

You say that the stereotypical wife basically works at home for no pay, what kind of BS is that? So she doesn't have a roof over her head, food on her table, clothes to wear, luxuries to enjoy, ad infinitum? She is being paid handsomely for her time in the home. In pure dollar terms, what is her "work" worth? I can pay a housecleaner $75/week to clean my entire house. Childrearing can be a pain in the butt, admittedly, but after age 5 they're in school most of the day anyway. I can hire a nanny for less than $12/hour. That's not chump change, but certainly cheaper than a potential divorce.

 

Anyway, perhaps you should reconsider regurgitating that nonsense about women being inferior to men and start backing up your assertions if you're going to play Ms High and Mighty on the internet.

 

You complain about me telling her to go make a sandwich while saying that's the kind of thing she should be handsomely rewarded for. So which is it? Should she be making a sandwich as I suggested (a man gets hungry trading stock in the evenings), or should she be sitting on her butt sponging off her hubbies excellent wage? She can't do both.

 

As for his actions with his finances, how do you know they agreed before marriage to always discuss this stuff? It's very likely they agreed that he could do whatever he wanted once he paid the bills and took care of all the necessities and whatever standard luxury items they own.

 

The fact is, you're just making assumption after assumption based on false premises, which bodes hilariously well for your future as a lawyer.

 

Am I being inflammatory? Sure as hell I am, you gotta be passionate about something.

[LisaUk]

LisaUK, I find it unfortunate that you are perpetuating those tired old stereotypes, particularly since you claim to be studying to be a lawyer. I don't claim anything, first off I am not a liar. Perhaps some legal terminology with convinve you? The fiducuory relationship that is inherent to the relationship of the trustee and beneficary allows for the equitable tracing of property into third party assets, so as to affect the duty of the trustee to the principal. Or how about some latin? Actus novus interviens or mens rea, inter alia, per se. Some case law maybe? What ratio decendi does the house of lords decision in Stack v Dowden provide us with when determining the benficial interest in property? Indeed, what is the difference between holding legal title and benefical title? Or maybe some contract law? Under the doctrine of notice a husband will be taken to be an agent of the third party when exerting undue influence over his wife as acting as surety for a charge. In this situation a lender should be put on constructive notice. I think I have demonstarted I am studying law.

 

Other than that, why would I waste my time replying to someone who is incapable of forming an argument and has to throw personal insults about to compensate?

Edited February 13, 2010 by LisaUk

[sally4sara]

And the battle goes on.....

 

I don't know much about the OP, but I would be bothered that there was no mention of his intentions prior to his actions. That isn't acting like a partner. You don't keep each other in the dark on things, let alone things this big.

 

The OP's husband may be the larger contribution to their income. He may even be the only. He may be the one in their marriage that handles the finances. We go into marriage plenty aware that bad investments get made. The best way to guard against any hard feelings when a bad investment goes down is for both spouses to have discussed it and come to a decision prior to making the investment. Instead, he decided she didn't need to know what risks he took with THEIR future.

 

This isn't just a matter of gender contention. It could just as easily been some guy's wife who made the bad investment without conferring with him before hand.

[Angel1111]

Other than that, why would I waste my time replying to someone who is incapable of forming an argument and has to throw personal insults about to compensate?

 

I agree. It's better to just ignore.

[Angel1111]

I don't know much about the OP, but I would be bothered that there was no mention of his intentions prior to his actions. That isn't acting like a partner. You don't keep each other in the dark on things, let alone things this big.

 

Some of the attitudes about spouses are downright frigthening. It would make me shudder to be married to someone who put such division in a marriage. It's like a battle between husband and wife, a mine and yours attitude. It's truly sad.