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The reason most young guys are marriage-shy is that they can't afford it.
I think a big part of the problem is the high bar we place on weddings, honeymoons, etc. All of that is fluff and nonsense as far as forming a long lasting union goes.
I think a big part of the problem is the high bar we place on weddings, honeymoons, etc. All of that is fluff and nonsense as far as forming a long lasting union goes.
Former coworkers and friend of mine group up with money but his fiance didn't. She is a manager at a public accounting firm, so brings in low six figures in a low COL metro, but it goes out faster than it comes in. She's the spender and he's the reasonable one. Like me, she didn't have much growing up and is trying to make up for it now.
They spent $30,000 on a wedding at a high end country club, he spent around $10,000 on an engagement ring, and they spent around another $20,000 honeymooning in Greece. Absolutely unbelievable. They're probably in the $160k-$180k range, so a good income, but he's constantly trying to throttle her spending.
I am not sure if they will break up over this but he's been forthcoming with his frustrations over the spending.
I think a big part of the problem is the high bar we place on weddings, honeymoons, etc. All of that is fluff and nonsense as far as forming a long lasting union goes.
Lots of things are fluff and nonsense. Basically, a wedding is just an excuse to throw a nice party. Something to enjoy in the present and then remember and talk about in the future. The quality of the marital union is something else entirely.
Again you didn't answer the question I asked. I know you are educated so you should be able to understand not only the difference between marginal and effective rates but also the marriage penalty has largely been fixed. Higher dual earners pay a little more, one high earner and one lower earner actually benefit. I'm not sure you understand how the marriage pentaly/bonus actually works. I provided you multiple examples already
I am very aware of it as I have to deal with the penalty.
Good problem to have, but a problem nonetheless.
Your questioning marginal vs effective tax rates boggles me. Yes if I make $75,001 my entire salary isn't taxed at 25%, only that last dollar is (well actually none of it would be with deductions/exemptions, so let's just assume there AGI).
If someone is married and they are making enough to have a portion of their income in the 25% bracket, their spouses first dollar will be taxed at 25%, making the 25% tax bracket the spouses marginal, and effective tax rate.
Below the 25% bracket the whole thing works great, but once you get above the 25% bracket the married brackets are no longer double the single brackets and there is a very real penalty.
You can come up with as many exceptions to the penalty as you like, but the FACTS are in the brackets. And if you make more than $75k the brackets are not your friend.
Former coworkers and friend of mine group up with money but his fiance didn't. She is a manager at a public accounting firm, so brings in low six figures in a low COL metro, but it goes out faster than it comes in. She's the spender and he's the reasonable one. Like me, she didn't have much growing up and is trying to make up for it now.
They spent $30,000 on a wedding at a high end country club, he spent around $10,000 on an engagement ring, and they spent around another $20,000 honeymooning in Greece. Absolutely unbelievable. They're probably in the $160k-$180k range, so a good income, but he's constantly trying to throttle her spending.
I am not sure if they will break up over this but he's been forthcoming with his frustrations over the spending.
I think a big part of the problem is the high bar we place on weddings, honeymoons, etc. All of that is fluff and nonsense as far as forming a long lasting union goes.
Hmm, I don't know. I see both happen. The most memorable wedding I've been to was my best friend's. They had their ceremony on the top of Haiku Stairs in Hawaii. Yeah, getting to Hawaii cost a lot but it doubled as their honeymoon plus it was pretty much them, their parents, and a few friends so it's not like the sandwiches at the top of the trail cost much.
Too bad tax code can punish marriage if both partners work.
I just did the cocktail napkin version of that math with my girlfriend. Our combined income would be north of $300K. We get to peel $50K off the top by maxing our 401(k)s. It looks like we don't hit the Schedule A phase out and we don't have enough Schedule A to hit AMT. It looks like about 2 1/2% to 5% more Federal income tax depending on what kind of years we have. That's not "punish" but it's a few thousand bucks.
I thought it was going to be worse than that. Looking at the spreadsheet, it gets ugly at a combined income more like $400K.
There are two other places to check:
One is the tax implications of Social Security income. Married, we'd be paying tax on 85% of our Social Security. Single, we might be able to game it down to 50% for at least one of us.
The other is the whole Medicaid long term care issue. Married, if one of us lands in a nursing home, it wipes out everything but the house, the car, and ~$120K of "countable assets".
From a money management point of view, I don't see a heck of a lot of advantages to being married in my circumstances but it's less penalty than I thought for my circumstances.
Two singles having $30,000 in taxable income would each owe taxes of $4.043 for a total of $8,086. As a married couple filing jointly, taxes on the same $60,000 would come to $8,081.
FYI, if your AGI minus half of your SS benefits plus any tax-free interest on muni's comes to more than $34,000 on a single return or $44,000 on a joint return, 85% of your SS benefits will become taxable income.
On the other hand, with dual incomes a couple can afford a more expensive home, and have a bigger mortgage interest and property tax deduction.
That a lot of the time is the problem. A couple has two incomes and makes all their decisions on the combination of these two incomes. If one loses a job, they have a kid, some type of emergency happens (healthcare), then times get really tough. Usually why when they do get divorced neither one can afford the house they bought together.
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