Financial Fitness Contest Winner No. 84

Financial Fitness Contest Winner No. 84

Jennifer Little is a go-getter. But right now, even she admits that she’s pushing the limits–she hopes that it’s not too far, too fast.
This summer she planned to get married and move into a new home. This fall she will be starting law school, while continuing to work full time as a trust administrator for J.P. Morgan Trust Co., and look after her 5-year-old son, Donovan. “I hope that all that’s going on at once won’t put too much pressure on our relationship,” says Little of her fiancé, Richard McFarlane.

She’s banking on the fact that the couple has been dating for several years and living together for the last year. Perhaps the biggest challenge will be for the couple to merge financially. “I know that money issues are one of the main reasons people break up,” says Little, 27. “I don’t want that to happen to us.”

McFarlane, 36, pinpoints part of the problem. “A bad habit I have is organization with the bills,” he says. “I get it, then I can’t find it and completely forget to pay it until next month. Jennifer helped me with that. All bills go through her now.” Little is the primary breadwinner, making more than $70,000, and McFarlane, a customer service representative for Bank of America, makes about half that. She just purchased the $244,000, three-bedroom home where the Newark, Delaware, couple will live with Donovan, who is her son from a previous relationship.

One thing she won’t have to worry about is the cost of the wedding. Though she and McFarlane wanted a small wedding, being the only girl in her family, Little’s parents wanted to throw a big affair and forked over most of the $30,000 for the 125-person garden nuptials.

But once the festivities are over, reality resumes. There’s the $12,000 in credit card debt, accumulated for a variety of reasons, from purchasing company stock options and household appliances to making car repairs. Widener University law school will cost about $20,000 a year–her employer will pick up about $7,500 per year. Little gets more than $200 a month in child support from Donovan’s father, but private school costs more than $600 a month.

One key concern is the couple’s lack of liquidity. They have about $3,000 in their savings and checking accounts. And while Little is off to a good start with her retirement–with $41,000 in her 401(k), $900 in a Roth IRA, a mutual fund with $2,500, and about $6,000 in employer stock options–McFarlane has no retirement savings. “Retirement is not something I really thought about,” he says. As an aspiring musician, McFarlane says that when he was younger he didn’t always have extra money to put away.

In addition, Little is concerned about Donovan’s care should anything happen to her. “I also want to provide for my godson, my husband, and any children Richard and I may have,” says Little of her need for estate planning.

The next couple of years will be a time of transition, but Little is optimistic about married