I have been following the Ridge/Parore property relationship case with interest, not because of who they are, but because of the circumstances they find themselves in. Once upon a time they were in love, they made some financial decisions and now the love has died, they are finding out, ‘what happens to the money when the love dies’.
The Ridge/Parore case isn’t that uncommon. You meet someone, you fall in love and decide to start a life together. During this phase financial decisions are made, like, who is going to be in charge of the finances. These are either a conscious choice, or it just happens.
Things go along swimmingly and then something goes wrong and for whatever reason, you fall out of love and the relationship ends. Now things can get a little tricky if you aren’t organised, this is where you find out, ‘what happens to the money when the love dies’. The good news is most of the time this can be sorted without getting the judge involved, but when the trust completely breaks down (as appears to be the case here), sometimes it is the only option left.
In this love story as published in the New Zealand Herald, Ridge says she, “entrusted Parore to control her finances.” Ridge signed legal documents without taking advice. When the judge asked her why she did this she replied “I listened to my partner….. I trusted him 100%.”
Relationship mistake #1. Never ever, ever sign legal documents without taking legal advice, regardless who is putting them in front of you.
Relationship mistake #2. Handing over control of her finances to her partner. Trust is a wonderful thing and the sound basis for any relationship. However… if you are going to hand over control, you need to make sure that you still know what is happening, keep an eye on bank accounts, attend business meetings and be sure to get regular reports. If you can’t read financial statements find someone who can to help.
Relationship mistake #3. Delegation by abdication. Not only have you handed over control of your financial situation to your partner, you don’t want to know what is happening. In the early stages of the relationship this is usually due to trust, your partner has skills you don’t, so you happily leave them to it.
But at some point the going gets tough (financially I mean), and instead of getting involved and taking part in the decision making you continue to ‘not want to know’. You don’t want to accept the fact that you may have to change your lifestyle because the business has hit a bad patch. Or, you continue in blind faith believing the assurances that ‘things will be fine’ and you happily retreat back into your bubble.
This case is still continuing in the courts so we don’t know yet how the story ends.
The moral of the story so far, don’t let love get in the way of making sound financial decisions, keep the lines of communication open at all times. If you aren’t sure about something ask or take professional advice.
http://www.mymoneyseeker.com Lynda Moore