Dear For Love & Money,
My partner is our family breadwinner. We live in the Bay Area where housing prices are astronomically high. We have two young kids, are upper-middle class, and are doing just fine.
After years of making no money as a writer, I finally got a book deal and will be bringing in an additional $85,000 over the next two years. My partner wants to put that money towards our kids’ college funds. I want to try to buy a house with it (we have other house-buying money put aside). He thinks it’s a smarter financial decision to put it in a college fund than to buy a million-dollar house (which is more like $1.2 or $1.4 million where we’d like to buy).
I feel like housing prices will only grow and a house is a good investment. He thinks the market will crash eventually. Who’s right? How do we decide what to do with this extra influx of money?
Worried About Getting It Wrong
Dear Worried About Getting It Wrong,
I have a theory that underneath the straightforward decision “to buy a house or not to buy a house in this market” lies a difference between how you and your partner view this influx of cash.
I say this because I notice the very first thing you told me in your letter is “my partner is our family breadwinner.” I also notice your use of the word “finally” in reference to this new contribution you’ll be making to your family finances, but perhaps the most important clue in your letter that supports my theory is in the difference between how both of you want to spend the money.
He wants to put your new financial contribution in a savings account marked for a future concern while he continues to cover the family’s more immediate needs with his income. You, on the other hand, want to put the money towards a new house — a far-off financial goal that you now have the power to achieve sooner.
The difference I see is that your partner’s plan delays the impact of your financial contribution while your plan could change your family’s lives as early as next month. If I’m right about this being the true source of contention, I don’t think either of you are right or wrong, but I do think if you communicate why you want to spend the money on a house right now rather than throwing it in a savings account for later, your partner will likely understand.
I know that having an honest conversation about money and life goals is easier said than done because it always comes down to vulnerability and showing your partner your insecurities and dreams, but if your partner understands why you want to spend the money on your family’s immediate needs, together you can come up with a solution that achieves this goal — even if it isn’t buying a house.
That said, maybe I’m wrong and your urgency to buy a house is based entirely on your fear that if you wait the prices will only go up. Your fear and your partner’s hesitancy to buy at the top of a market he thinks is about to crash encapsulates a question on nearly everyone’s minds as we head into the 2022 home-buying season: buy before prices climb even higher, or wait for the crash? Unfortunately, despite a thousand podcasts, think pieces, and economic forecasts, there are no crystal balls.