Financial Feud: Spending windfall vs. Investing it

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$500 a month

The Argument:


I was expecting an insurance windfall. A few years ago, UPS was going to pay me $10,000 for a lost bike, but my fiancé and I couldn't agree on how to spend the money. She said I should buy a $5,000 bike and put the other $5,000 into our new house. I wanted to spend all $10,000 on a new custom-made, cut-to-my size, one-of-a-kind color bike. AM I RIGHT?

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The Argument:

I’m an avid cyclist.

A couple of years ago, I shipped my bike to an event, and UPS lost it. Fortunately, the bike was insured though -- WAY insured -- and UPS was going to write me a check for $10,000.

So I did what any sane person would do ... started shopping for a $10,000 bicycle. Custom made. Cut to my size. One-of-a-kind color.

My fiancé said, "Why don't you buy a $5,000 bicycle and put the other $5,000 into the house I just bought for both of us."

Then we both looked at each other like the other one was nuts.

It got to the point where I either had to order the carbon fiber rims or call off the wedding.

That’s when UPS decided that before they write me a check, they should look really, really hard for the bike, which they found a thousand miles away from where it was supposed to be.

I never got my custom-made bike, but I didn't destroy my marriage either.

I should disclose that I thought my husband was insane for spending nearly $1,000 on the bike he bought me. So, clearly, I lean toward your fiancée’s point of view. We just don’t get the bike thing. (For that matter, I don’t get the fancy car thing either.)

Part of being a couple is acknowledging that there are things you’ll never really understand and accepting those differences. You weren’t wrong to want to use your potential windfall to buy a really cool bike. Your fiancée wasn’t wrong to suggest buying a still-very-cool bike and deploying the rest elsewhere. UPS solved this impasse for you, but you’ll have many other opportunities to wrestle with your financial differences in the years to come.

Because most of the time, there is no “one right way.” It’s a balancing act. You need to save and invest some of your money for the future, but you also need to enjoy your life today. You need to compromise, of course, but not endlessly. A lot of the time you do have to meet halfway, but if something is important enough to you (or to her), you can figure out a way to make it happen. As my husband says, “Sometimes it’s not who’s right. It’s who wants it more.”

About the author

Liz Weston is one of the most-read personal finance columnists on the Internet. Her columns appear on MSN Money and in newspapers across the country, including the Los Angeles Times and Stars & Stripes.
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Like Kabob said, it'd be nice to have known the value of the original bike. IMO, Glen was due the equivalent bike to the one he'd lost, whatever it cost - up to the $10k insurance check. Just reading between the lines Glen sounds like he's more in love with cycling than anything else. He's got a caring wife, and a house that she bought for them. Hey Glen, why not buy your bride a bike, or better yet get a tandem - and don't insist she pedal too hard.

The expensive bike was a before-marriage purchase. Thus, as Apple Kabob says, hubby is justified in spending the money to replace the lost bike. However, the full disclose also reveals that she was the major, or only contributor, to the purchase of the house. This changes things. Marriage is give and take. She is recognizing that he needs a nice bike because he loves cycling. By him spending less on the new bike and putting money on the house he shows he is committed to their joint ventures as well as his own.

What isn't stated here is the cost of the original bike. It seems unlikely to me that the insurance company would offer significantly more than the value of the bicycle (that would be a ridiculous business model). Even if the original bike cost only $5000 originally, lots of custom parts and hours of service (done by him or a bike shop) can add up to a lot more. If he took out the insurance policy with his money on his bike (especially if the mailing incident occurred prior to their engagement), it was his bike and when they lost it, the insurance money was to replace that bike.

Let's consider it a different way. Let's say this guy was an avid cyclist with a high performance bike and a stranger offered him $10,000 for it. Would it be right for his fiance to force him to sell the bike? If he chose to sell the bike, would it be right for her to expect him to give her some of the money?

People's values and interests change over time and maybe he would enjoy the unique opportunity of being able to convert some value from the bike into value towards a shared home. But it's hardly his moral duty to do so.

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