settle down get married

Looking for a Wife to Reduce Taxes!

Erik Basics, Financial Education, Thoughts of a Mastermind 45 Comments

I’m sick of being single. I’m sick of paying lots of taxes. Guess what, it’s 2017! I can do whatever I want with my life! It’s official: I’m looking for a wife to reduce taxes. Who needs love, it’s all about the MONEY, BABY!!!

Time to take action, in this post, I lay out my reasoning and give my dating preferences for prospective applicants 🙂

(Readers: I’ve been writing a lot of serious posts lately on starting a subscription box business and being proactive in life… please forgive me if my attempt at humor falls flat!)

get married and reduce tax liability

The Tax Code is in Favor of Married Couples

Personal finance bloggers always talk about the importance of fees in investing. I love index funds because the fees are super low (.1%! vs. 1% or 2% for actively managed funds.) Guess what is the biggest fee that people don’t always look to optimize? TAXES.

Yesterday, I was doing some light reading on Physician on Fire about Roth vs. Traditional IRA Contributions. (Maybe not the best way to start the article for attracting my future wife)

In Physician on Fire’s post, a table was included showing the tax rates for single and married couples. I knew about the difference in the past, but it never hit me like it did yesterday. Looking at the table below, married couples have a huge advantage from a tax perspective.

2017 tax rates

2017 Tax Rates – why is the 35% bracket so small? Is Congress out to get single people making exactly $417,000?

In 2017, I’m pushing the 28% bracket. Last year, I made $93k gross and my adjusted income was $77k. This year, I’m on pace to make roughly $110k and as a result, my adjusted income will come in around $95k. Looking at the chart above, it’s OBVIOUS I need to wife up. An extra 3% a year will introduce a lot of drag on my wealth. This is ridiculous, I need to act now.

Looking for a Wife to Reduce Taxes!

Here’s my pitch to prospective applicants: I’m not asking too much here. I’m 24, healthy, motivated, and looking to help people – does that sound reasonable to you?

For my future wife, I’m looking for the following:

  • A woman who understands the importance of living below your means
  • A woman who is willing to sacrifice today to live like a king and queen tomorrow.
  • Someone who invests in themselves and is optimistic about the future.
  • A woman who will support me in my crazy endeavors, such as buying houses or starting businesses.
  • Someone who will help with house work (hey, gotta make the ask! this is my ideal wife we are talking about 🙂 )
  • No job experience required. Student loans or other debt not required. No future job prospects required either. (The tax code is favored towards stay at home mom’s 😉 )

Conclusion

It’s possible my standards are too high. It’s also possible I’m just being silly and love is the way to go. Love makes the world go round… though love isn’t certain like death and taxes. Hm… I’ll continue thinking about the topic of getting a wife to reduce taxes!


Married readers, is my idea flawed? Should I wait for love? What have been some money successes you’ve had from getting married? Who would be your ideal partner for financial success?

Erik

Comments 45

  1. Erik, being married certainly reduces taxes but it significantly increases expenses… and then when you add children then expenses go through the roof!

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      Hey Mark, I appreciate you stopping by to comment and point out a big flaw in my thought process. 4 kids definitely would increase expenses quite a bit, and I’m sure most women loves their credit card to go shopping!

      1. I also think that once you marry you buy nicer stuff – the days of living in a mess as a batchelor are gone and now you have to buy real furniture, nice dishes , decorate properly. It is called civilization and a wife may make you civilized with accompanying expenses!

  2. Ha! As a fellow singleton, I’ve also wondered if it would be beneficial to get married for tax reasons. You’ll have to let me know how it works out for you. I keep wondering when someone in the PF community will create a dating service/app to help match like-minded people 🙂

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      Hey Kate, I’ll get on creating that app… name? I don’t know yet, Maybe “Love on FIRE”?

      Thanks for stopping by, have a good one

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  3. I read the same post and thought the same thing!! Damn married couples get all the breaks…then again, a lot of compromise goes in to being married and I may be past the point of compromise. 😉 I’ll keep an eye out for you!

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      Miss Mazuma, great to see you stopping by to comment and support my cause! Please do keep an eye out for me! 🙂

  4. Ooh baby you’re speaking my language- 401(k)’s, Roth IRA’s, 403bs- talk dirty to me! (Just don’t ask me about my backdoor [Roth])! Tax breaks are a two way street! What if *I’m* looking for a husband to reduce *my* taxes? I need someone around to split the housework with who wants to be the muscle for my rental business! It’s 2017 after all! Hahahah I loved this article!

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      You have a good point Gwen, it is 2017. I’m not below becoming a gold digger and stay at home dad to reduce my wife’s taxes!!! Ha.

      I’m glad you liked the article, appreciate the comment.

  5. So here’s the thing. There is this thing called a marriage penalty. Take another look. If you both make the same amount your rate is less individually then it is together. So at 90k your in 25 percent but at 180 your in 28 percent. So really you just need a dependent. I would still not make money your only criteria, you need to enjoy spending time with the person and be willing to deal with ups and downs together. Finances are just one piece of the pie.

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      Hey FTF, thanks for pointing that out. I agree I made the situation simplified and with all tax scenarios, things can get hairy and it would be wise to look at each case with scrutiny.

      Thanks for stopping by.

    2. I was going to mention the marriage penalty, as well. The tax code doesn’t actually favor married couples, it favors married couples where one spouse makes most of the money. If you are a two-income household with similar incomes, it actually costs more to get married than to live together as single.

      Add to that if you are on an income-based student loan repayment plan that either your loan payments will (roughly) double or you will need to file taxes as Married Filing Separately and lose a bunch of deductions.

      When Congress wrote the tax code they definitely did not want to encourage both spouses to work.

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        Interesting points Matt. I probably need to learn more about the tax code before I look for a wife because of taxes…

        Thanks for stopping by

  6. I married for boring, sentimental reasons like love, but I think you’re onto something.

    One wrench to throw in the works (given your preference for a non-working spouse and the favorable tax angle): I’ve found that having one spouse working for the Man (with benefits…) and one pursuing pirate ship entrepreneurial adventures is actually a pretty sweet portfolio approach. You may want to develop a Plan B if your search turns up a candidate who actually has a job. It could even hurt taxes (per FTF above), but it may supercharge your entrepreneurial ambitions.

    Happy hunting!

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      Love is a great thing.

      That’s a great point you are making about one spouse working and the other having an entrepreneurial itch. My ex-girlfriend’s aunt and uncle did something like that: the aunt was a CFO and the chief bread winner and the uncle was running a small business (probably at a loss) to reduce their tax liability.

      Thanks Paul 🙂

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  7. FiveThirtyEight did a pretty exhaustive analysis of this issue. Dual income households are penalized by marriage, and single income households are rewarded.

    I got married in my first full year as an attending physician — the timing was coincidental, but it sure did help the tax situation. And there are other benefits, too, like home-cooked meals, someone to watch movies with, and frequent relations.

    Cheers!
    -PoF

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      I recall reading the FiveThirtyEight article and remember that DI doesn’t help if both people are earning lots of money, consistent with your point. That’s great for you, your income was way up and you could take advantage of slightly lower rates!

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  8. I think the one flaw in your plan that you may not be considering is that you’ll pay a 50% tax if you get divorced and it’s not just on income but everything that you own. Divorce can be brutal and way worse than the 3% drag on your portfolio.

    So personally I think it’s better to wait and find the right one 😉 You’ll be much happier!!!

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    2. If you get a pre-nup though, it doesn’t have to be a 50% tax! AND you’ll save money on future lawyer expenses!

      I think the only time I think about having a kid or getting married is when I do my taxes. Getting married would help me a ton with my taxes, but would not help Mr. Beach Life so much. Good thing we’ve got a good arrangement going as it is 🙂

  9. Yeah, I agree with Mark and Rob. Family life and divorce are expensive. My wife became a stay-at-home mother last year and it’s worked out nicely for us so far. To afford it, we had to move to a cheaper area.

    But, don’t just look for love … look for your “financial soul mate.” If the two of you disagree about money, forget FIRE. If she’s a spender and you’re a guy who wants to save and start businesses (or vice versa), your financial train will derail incredibly fast.

    Of course love is important, but after the honeymoon, reality does set in. You need to be on the same page.

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      Yeah I agree with you about the concept of the “Financial Soul Mate” – if you can’t agree on money, it isn’t going to work out.

      I’m going to look for someone who is amazing in all ways, though finances will be crucial.

  10. Getting married has worked out for us financially in about every area are but taxes.

    Two 401ks, two company matches, two options for insurance, split cost of housing. It is just those lovable babies that tend to follow marriage that will drive up your expenses.

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      Awesome Grant, I’m glad it’s worked out for you and now with Junior on board, I’m sure it’s even better!

      Life isn’t all about money – when you have a partner, saving for things definitely helps!

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  11. Keep your standards high and don’t settle! It is not worth the tax break if you aren’t happy and aren’t going to enjoy your time together. Plus, as it has been pointed out by others, if you have a spouse with similar income, your tax rate actually remains the same! Still, the article gave a me a nice laugh, so thanks for the fun read today.

    Bert

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  12. Under 25 and making six figures, you will be a great catch. You probably forgot to mention that your candidate need to make six figures too. Otherwise, the tax that you save, may not be enough to maintain your relationship.

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      Thanks Leo for the comment 🙂 I’m a catch, but I’m busy with my side hustles and rarely get out… 🙂

      Money isn’t everything… oh wait, isn’t that the premise of the article? hmm…

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  13. Apart from the taxes, the dual income is definitely a plus. I use my income for some expenses and she uses hers for others. It works out fine and we end up saving the rest. Of course I wouldn’t be able to save as much if I were single. And don’t forget to put some of the investments in tax deferred accounts 🙂

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  14. I would advice you to watch King of Queens season one and the final season. You don’t want to end up like Doug. Oh and also watch Til Debt Do Us Part, a few episodes would be enough.

    After that, if you still want to marry then at least you would know what you are getting into. You can find both shows on You Tube, I think.

    Good Luck!
    Mr. ATM

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  15. My friends make fun of me all the time for saying stuff like this. Even though expenses may go up slightly and the tax benefits may or may not be a wash depending on income. Just having a dual income opens up way more possibilities. Can pay down debt faster, pay off a house faster, have more available cash to invest with to build wealth, and have someone to hang out with or take to events (get your family off your back, am I right?). They just need to have a similar mind set as you as far as frugality and living below their means is concerned. I appreciate the humor.

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      Thanks DD for the comment. I love how humor can go a long way in a situation 🙂

      It’s definitely interesting – to your point, it would bring a lot of options to the table!

      Thanks for the comment and stopping by.

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