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The Moneyist: ‘Am I being ripped off?’ I moved into my husband’s home. I pay for groceries. The rental income from my apartment goes into our joint savings.

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Dear Quentin,

I read one of your previous columns regarding the boyfriend who wants the letter writer to move in. My case is similar, but we have already made a decision on how to structure our finances as they relate to our living arrangements.

Here is my dilemma: I own an apartment, and it is paid off. However, I moved into my husband’s apartment. He has also paid off his mortgage. I have rented out my home, and the income from that goes into our joint savings account.

I am paying my own maintenance and taxes for my home, and likewise, he pays his own maintenance and taxes for his property. While I am living in his apartment, I am in charge of the groceries. Am I being ripped off?

Feeling Uneasy

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Dear Uneasy,

Before we get to whether your situation is fair, a word of warning: If you use funds from that account to repair your home, you will more than likely commingle that asset — that is, turn it from being a separate asset to being marital/community property. State laws vary, but you should consult an attorney before commingling assets from rental income.

There is a term in real estate called getting “gazumped.” That is, accepting an offer at a certain price only to have the seller up the price at the last minute and/or have someone else arrive at the 11th hour and beat your offer. It happens when your back is turned, when you’re about to open the Champagne, or merely when your guard is down.

Your husband might have suggested that it would be more convenient to deposit the rent from your home into a joint savings account. But it all depends on the figures. If, say, you are depositing $2,000 in your joint account and paying $500 on groceries per month, your husband is netting $1,250 a month from your deal, while you are netting $500.

“ ‘You will have to pay taxes on your rental income, so splitting the gross proceeds 50/50 is a bad idea. At the very least, it potentially muddies the water.’”

What’s more, you will have to pay taxes on your rental income, so splitting the gross proceeds 50/50 — something that you are effectively doing by depositing it in a joint account — is a bad idea. At the very least, it potentially muddies the water. You also have the added responsibility of being an absentee landlord, while your husband gets a wife and tenant rolled into one handy arrangement. 

Ultimately, your question is hard to unpack without the numbers. You and your husband each pay for your own taxes and maintenance now that your respective mortgages are paid off. They may or may not be an equal amount, but they are based on the market value and size of your respective homes. For that reason, they should be left out of the equation.

I recommend keeping separate bank accounts, and paying your husband X amount per month for living in his home, and dividing the other bills (like electricity and groceries) 50/50. That keeps things simple, and ensures no one is taking advantage of the other — even inadvertently. You can always set up a joint account later, and each make a set deposit every month.

If this is your first marriage, merge your assets gradually and carefully. If it is your second marriage, proceed with more caution. I understand that you want to be husband and wife, rather than roommates, but you may have more success by maintaining your financial independence. That way, you’re together because you want to be, and not because your union is dictated by finances.

Check out the Moneyist private Facebook group, where we look for answers to life’s thorniest money issues. Readers write in to me with all sorts of dilemmas. Post your questions, tell me what you want to know more about, or weigh in on the latest Moneyist columns.

The Moneyist regrets he cannot reply to questions individually.

By emailing your questions, you agree to having them published anonymously on MarketWatch. By submitting your story to Dow Jones & Co., the publisher of MarketWatch, you understand and agree that we may use your story, or versions of it, in all media and platforms, including via third parties.

Also read:

‘When we dated for 5 years, he implied he was financially secure’: My husband was always hesitant about his finances. Now I know why.

‘My girlfriend owes $200,000 in medical and credit-card debt’: She wants me to settle it — by paying a portion of the outstanding amount

‘He’s not willing to live in my house because it has fewer amenities’: My boyfriend wants me to move in and pay half his monthly costs. Is that fair?

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