Pre-nup at only $1M networth, do I need it?

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills.
mptfan
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Re: Pre-nup at only $1M networth, do I need it?

Post by mptfan »

stoptothink wrote: Maybe I am wrong, but I don't think anybody was suggesting that there was some gender issue at play here; other than the fact that most of the members of this forum are male ...
How do you know this?
sscritic
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Re: Pre-nup at only $1M networth, do I need it?

Post by sscritic »

I read lots of posts. My observation is that I see more DW than DH, and that doesn't even account for the fact that (I believe) that men are less likely to write DW than women to write DH. I also participate in most SS threads. While some try to pull off the spouse taking the spousal benefits on the work record of the spouse, I try to stick to husband/wife, he/she (it's just easier that way). When people get around to identifying their spouses, there are many more posts by husbands talking about what to do when considering their wives' work record than the other way around. I also see very few of the "my husband is incompetent so I need a plan in place when I pass" posts as compared to all the men posting about their incompetent wives (I happen not to agree with them, but that's the implication of all the posts - I know, they are usually phrased as "not interested," but we know those are just code words).

So yes, I think there are more men than women, although women are more likely to hide that aspect of themselves on the internet. I know I have been disabused by PM several times of an assumption or two that I made.
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andronikus
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Re: Pre-nup at only $1M networth, do I need it?

Post by andronikus »

mptfan wrote:
stoptothink wrote: Maybe I am wrong, but I don't think anybody was suggesting that there was some gender issue at play here; other than the fact that most of the members of this forum are male ...
How do you know this?
I don't think they do. I know politics is not allowed around here...

I happen to live in a state that still awards permanent alimony, and has "equitable distribution" ('equitable' != 'fair', eg. watch out for commingling of assets, especially with regards to the marital home if you had it before being married).

For a person who walks into a marriage with nothing(unemployed/low-income, student debt, loans, bankruptcy) compared with a high net-worth spouse(high wage-earner, real-estate, cash, investments, business) there is too much incentive to walk, and not enough to stick it out, especially if children are involved. This is the way things are, and it would be foolish to not have a firewall [prenup] in place.
Call_Me_Op
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Re: Pre-nup at only $1M networth, do I need it?

Post by Call_Me_Op »

I would not enter into any sort of arrangement where I am not comfortable with the risks. Marriage should not be a jack-pot for anyone. It is one thing for two people starting out in their 20's with little assets, and quite another for someone older who has accumulated significant assets. In the latter case, it is not prudent to just charge ahead without a clear-headed assessment of what might happen should things not go as hoped.
Best regards, -Op | | "In the middle of difficulty lies opportunity." Einstein
techcrium
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Re: Pre-nup at only $1M networth, do I need it?

Post by techcrium »

Professor Emeritus wrote:
andronikus wrote:
mptfan wrote:
stoptothink wrote: Maybe I am wrong, but I don't think anybody was suggesting that there was some gender issue at play here; other than the fact that most of the members of this forum are male ...
How do you know this?
I don't think they do. I know politics is not allowed around here...

I happen to live in a state that still awards permanent alimony, and has "equitable distribution" ('equitable' != 'fair', eg. watch out for commingling of assets, especially with regards to the marital home if you had it before being married).

For a person who walks into a marriage with nothing(unemployed/low-income, student debt, loans, bankruptcy) compared with a high net-worth spouse(high wage-earner, real-estate, cash, investments, business) there is too much incentive to walk, and not enough to stick it out, especially if children are involved. This is the way things are, and it would be foolish to not have a firewall [prenup] in place.
I walked into a marriage with less than nothing. She had assets. What I did have was the shared sense of building that goes with a total commitment to a relationship. We were partners in every way possible. At every point in our marriage I used every talent I had to ensure her professional success. 39 years later I manage DWs separate money as a fiduciary in accordance with her intentions. I am also her 24/7 caretaker. You can have a whole marriage partnership or you can have a "partial" one. Pre-nups are fine for partial commitments. It's the same as buying stock. Your liability is limited to what you invest.
Going with your stock analogy, are you the type of guy who puts all their money into a single stock or do you diversify in case of risk of that company going bankrupt?

If you are a guy at age 35 with $500,000 assets while your spouse has $100,000 debt, I am not saying to outright ask for a prenup...

I would suggest you to take that $400,000, put it in a trust for your personal retirement, have a condition where if you 2 are still married at 65, then it will be distributed to both.
putri
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Re: Pre-nup at only $1M networth, do I need it?

Post by putri »

Yes!! You never know what will happen, doesn't matter how in love or committed you are to each other right now. You can still have a great marriage and have a family. Whatever comes before the marriage will always be his and hers and whatever you create and accumulate together during the marriage, kids included, will be shared -- and if shit does happen, split between the two.

I thought I was going to married the love of my life but yes, it didn't work out and we're now married to somebody else. We were respectable of our finances (I had money from my family) and I walked away with my family money and we split the rest. My ex husband did remarry but the girl was only nice at first. She made good money but she's also greedy. So she took the Tiffany (that she asked for) and the house that he bought before they got married, and the cash that he has left. Oh, and he had to pay her support for a year. So my ex was not the most intelligent and the nicest guy on the planet but that's what he gets for being too nice. He is now broke, in the negative to be exact, but hopefully happily married.

Point of it all, protect yourself, crap happens!
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SamGamgee
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Re: Pre-nup at only $1M networth, do I need it?

Post by SamGamgee »

My sense of things is that the OP must decide for himself whether a pre-nup is required. Only his gut can answer that question.

My advice goes like this: If your gut tells you that you don't need a pre-nup, get married without a pre-nup. If your gut tells you that you need a pre-nup, walk away. Just walk away.
Achelois
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Re: Pre-nup at only $1M networth, do I need it?

Post by Achelois »

istoner wrote:
stoptothink wrote: Maybe I am wrong, but I don't think anybody was suggesting that there was some gender issue at play here; other than the fact that most of the members of this forum are male and therefore the former spouse would be a wife.
Thanks to both stoptothink and Achelois for their personal stories, which I find instructive, though sad. I wanted to briefly respond to the above comment: I think I agree with you as far as this pre-nup thread goes. In the last one, however, (locked) there was definitely at least one poster vociferously expounding on how sexist and punitive the "divorce laws" were to men.

To the substance of your posts, I understand loving someone so much you would do anything to marry them. I also wonder if either of you look back and see any warning signs (the value of 20/20 hindsight, of course, being what it is).

No, looking back, I do not see too many warning signs. The major thing I would have done differently would have been to have moved farther away from my in laws. We moved next door at my husband's wish and he was very influenced by their thinking, which was, to say the least, very traditional.

My ex was, and is, a hard worker and a very good father. I think my doing so well was detrimental to his self-esteem. I did not place much importance on the fact that I made more, as he had many other skills which I did not and which I respected. I was just happy our family was doing better financially. He only found out I made more by accident when he had to do the taxes one year when I was ill. I do not think it occurred to him that wives COULD make more. :( This was about 20 years into the marriage and I can pinpoint the change from there. It may or may not have been under the radar before, but I did not pick up on it if it was.

I was in school and working only 24 hrs per week and can still see him standing in the doorway yelling at me, "you made THIS much working only part time?"

People do change over time and over the craziest things, sometimes. I can see having a prenup when there is a great disparity in assets at the outset. I do not know whether one would be of much utility 20 years down the line; I am not conversant with laws on it. I do not believe that it is a reflection on anyone's love or trust or commitment, but rather a recognition that people can change, there are things beyond one's control. One can trust another with every fiber of one's being--but could be mistaken about that person's trustworthiness. Con men/women exist; some of whom are very good.
Gnirk
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Re: Pre-nup at only $1M networth, do I need it?

Post by Gnirk »

Yes. Divorce happens.
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HomerJ
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Re: Pre-nup at only $1M networth, do I need it?

Post by HomerJ »

SamGamgee wrote:My sense of things is that the OP must decide for himself whether a pre-nup is required. Only his gut can answer that question.

My advice goes like this: If your gut tells you that you don't need a pre-nup, get married without a pre-nup. If your gut tells you that you need a pre-nup, walk away. Just walk away.
Everyone's gut when getting married tells you that you don't need a pre-nup... EVERYONE getting married is only getting married because they think it's true love that will last forever... Otherwise they wouldn't be getting married.

It's their BRAIN that tells them maybe they should be careful, since they maybe just saw their best friend get divorced, and he never saw it coming.
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Momus
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Re: Pre-nup at only $1M networth, do I need it?

Post by Momus »

sscritic wrote:
andronikus wrote:To the OP: [who lives in California - added by respondent]

The laws are not made in your favor, and the family court system is the last place you want to be deciding who gets what.
I don't know what you know about the laws of California. Now perhaps you think your responsibility to your children ends at the point that you deposit your seed in the proper receptacle, but even if you do, a pre-nup with that as a premise will not stand up in court. An pre-nup with illegal conditions is not going to do you much good.

Do you know the standard for spousal support in California? For example, does it last for a lifetime? What is the stated goal of spousal support in California?

And once again, I have to ask if you understand community and separate property as they are defined and applied in California? If you don't know California law, why are you advising someone living in California? I don't know that you don't know California law, but since you made no reference to California in your response, I don't think you were really addressing the OP, in spite of the fact you said your response was addressed to the OP.
I think my decision is leaning to ask the girl for a pre-nup since there is no way I can tell for sure that a girl marries me for my money or love unless she signs one.

Would the separate assets you own before you get married (the one that keeps generating new income/dividend) become community property after one gets married?

Say you have a stock portfolio/rental house before you get married that makes $30k in dividend/rent every year? Do you have to distribute 1/2 of the income immediately after you get married to the spouse to keep stuff separate (so you don't comingle it)? It can become very complex. How does one do this?
steve_14
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Re: Pre-nup at only $1M networth, do I need it?

Post by steve_14 »

Momus wrote:I think my decision is leaning to ask the girl for a pre-nup since there is no way I can tell for sure that a girl marries me for my money or love unless she signs one.
Miss Right would be foolish not to consider your wealth in deciding whether or not to marry you - after all, you're performing exactly the same analysis here, carefully considering the financial aspects of marriage to her. Love happens naturally, but signing a legal document tying yourself financially to someone for the next few decades requires a different set of considerations.
denovo
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Re: Pre-nup at only $1M networth, do I need it?

Post by denovo »

Momus wrote:
sscritic wrote:
andronikus wrote:To the OP: [who lives in California - added by respondent]

The laws are not made in your favor, and the family court system is the last place you want to be deciding who gets what.
I don't know what you know about the laws of California. Now perhaps you think your responsibility to your children ends at the point that you deposit your seed in the proper receptacle, but even if you do, a pre-nup with that as a premise will not stand up in court. An pre-nup with illegal conditions is not going to do you much good.

Do you know the standard for spousal support in California? For example, does it last for a lifetime? What is the stated goal of spousal support in California?

And once again, I have to ask if you understand community and separate property as they are defined and applied in California? If you don't know California law, why are you advising someone living in California? I don't know that you don't know California law, but since you made no reference to California in your response, I don't think you were really addressing the OP, in spite of the fact you said your response was addressed to the OP.
I think my decision is leaning to ask the girl for a pre-nup since there is no way I can tell for sure that a girl marries me for my money or love unless she signs one.

Would the separate assets you own before you get married (the one that keeps generating new income/dividend) become community property after one gets married?

Say you have a stock portfolio/rental house before you get married that makes $30k in dividend/rent every year? Do you have to distribute 1/2 of the income immediately after you get married to the spouse to keep stuff separate (so you don't comingle it)? It can become very complex. How does one do this?
You've come to the right decision. Congratulations. The only people whose answers you should take seriously are those who have gotten divorced without a pre-nup with considerable assets in their favor. Among them, I bet the answer would be near unanimous that you should have one to protect yourself. Asking people who have never been divorced, is pointless. Even if you're sure about her now, people change. A pre-nup is an insurance policy, and a cheap cost-effective one at that.
"Don't trust everything you read on the Internet"- Abraham Lincoln
Professor Emeritus
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Re: Pre-nup at only $1M networth, do I need it?

Post by Professor Emeritus »

denovo wrote: A pre-nup is an insurance policy, and a cheap cost-effective one at that.
It is not an "insurance policy" You PAY for insurance. It is a self protection program at the expense of your spouse. That is what makes it" cheap".

Bogleheads know how words are used to mislead people. Whole life can be called insurance but we all know it is a very poor INVESTMENT

So call a spade a spade Limited marriages are not new. Recall a Morganatic marriage

In the context of royalty, a morganatic marriage is a marriage between people of unequal social rank, which prevents the passage of the husband's titles and privileges to the wife and any children born of the marriage. Now rare, it is also known as a left-handed marriage because in the wedding ceremony the groom traditionally held his bride's right hand with his left hand instead of his right. http://en.wikipedia.org/wiki/Morganatic_marriage
stoptothink
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Re: Pre-nup at only $1M networth, do I need it?

Post by stoptothink »

mptfan wrote:
andronikus wrote:
mptfan wrote:
stoptothink wrote: Maybe I am wrong, but I don't think anybody was suggesting that there was some gender issue at play here; other than the fact that most of the members of this forum are male ...
How do you know this?
I don't think they do. I know politics is not allowed around here...
I meant how do you know that most of the members of this forum are male?
There are many topics which make it pretty easy to figure out genders. I don't think it is any secret that there is a larger percentage of males on this board.
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HomerJ
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Re: Pre-nup at only $1M networth, do I need it?

Post by HomerJ »

Professor Emeritus wrote:It is a partial commitment. That is a simple fact.
It's a full commitment, unless there is a divorce... at which point, the commitment has been broken. No divorce, no splitting of the assets...

Are you saying that someone who gets a divorce without a prenup has a fuller commitment to his/her partner than someone who gets a divorce with a prenup? In both cases, they are divorced, and the commitment is gone.

If a couple remains married, prenup means nothing.
Professor Emeritus
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Re: Pre-nup at only $1M networth, do I need it?

Post by Professor Emeritus »

HomerJ wrote:
Professor Emeritus wrote:It is a partial commitment. That is a simple fact.
It's a full commitment, unless there is a divorce... at which point, the commitment has been broken. No divorce, no splitting of the assets...

Are you saying that someone who gets a divorce without a prenup has a fuller commitment to his/her partner than someone who gets a divorce with a prenup? In both cases, they are divorced, and the commitment is gone.

If a couple remains married, prenup means nothing.
Nonsense, It allows the wealthier spouse to walk out with no consequences. That is the whole point of a prenup. It is not a full commitment. Its limited liability corporation instead of a partnership.

Not to mention that it normally describes who controls assets within the marital community
Last edited by Professor Emeritus on Fri May 30, 2014 10:00 am, edited 1 time in total.
Stupendous
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Re: Pre-nup at only $1M networth, do I need it?

Post by Stupendous »

Professor Emeritus wrote:
HomerJ wrote:
Professor Emeritus wrote:It is a partial commitment. That is a simple fact.
It's a full commitment, unless there is a divorce... at which point, the commitment has been broken. No divorce, no splitting of the assets...

Are you saying that someone who gets a divorce without a prenup has a fuller commitment to his/her partner than someone who gets a divorce with a prenup? In both cases, they are divorced, and the commitment is gone.

If a couple remains married, prenup means nothing.
Nonsense, It allows the wealthier spouse to walk out with no consequences. That is the whole point of a prenup. It is not a full commitment. Its limited liability corporation instead of a partnership.
Nothing wrong with that because if someone married and divorced a non wealthy person there is no cash prize at the end of the marriage. Why should marrying someone who is wealthier be any different.

And no prenup allows the other person to walk out after X years with no consequence. Much easier to walk away when their is a cash prize at the end.
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HomerJ
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Re: Pre-nup at only $1M networth, do I need it?

Post by HomerJ »

Professor Emeritus wrote:
HomerJ wrote:
Professor Emeritus wrote:It is a partial commitment. That is a simple fact.
It's a full commitment, unless there is a divorce... at which point, the commitment has been broken. No divorce, no splitting of the assets...

Are you saying that someone who gets a divorce without a prenup has a fuller commitment to his/her partner than someone who gets a divorce with a prenup? In both cases, they are divorced, and the commitment is gone.

If a couple remains married, prenup means nothing.
Nonsense, It allows the wealthier spouse to walk out with no consequences. That is the whole point of a prenup. It is not a full commitment. Its limited liability corporation instead of a partnership.
It's not nearly as simple as that... 5,10,15 years down the road, especially if children are involved, no one is walking out without consequence. We're just talking about money made before the marriage, not during the marriage. It's a full partnership for everything done as partners.

Why would the poorer spouse be unwilling to sign a prenup?
(1) It only matters if there is a divorce
(2) it only affects money made before the marriage
(3) if the poorer spouse has any honor at all, he/she would not have any intention of claiming they deserve 50% of the money made before they even met their wealthier spouse.

The wealthier spouse is willing to share 100% of their money with the poorer spouse, full commitment... as long as they stay married. It's not like the OP is going to live in an expensive house without his wife or go on expensive vacations without her, saying "Oh, this is MY money, you can't afford these things".
BanditKing
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Re: Pre-nup at only $1M networth, do I need it?

Post by BanditKing »

You can always add a sunset clause to a prenup that it ends after, say, 7 or 10 years. You could even make it gradual working towards 50/50 split every year at 10% after 2 years, hitting 50/50 at seven. Boom, problem solved. If it doesn't last for whatever one of a thousand reasons, you're protected. If it seems to be going the distance, then that problem is solved by the language of the agreement.

7 years ago, I almost got married (called it off a few months before for a myriad of reasons). We had a prenup. Not because I was "rich" by any means, but because we decided we needed to keep our finances separate due to retirements and pension, large potential inheritances, debts, etc. We both had our own bank accounts, and to cover living, we both paid into a common account to cover bills (we called it "his/hers/ours"). In any case, our prenup had a simple sunset clause that after 7 years, providing we had kids, it would end. If we never had kids, it would remain in effect. Of course, we could also end it at any time by mutual agreement.

She was somewhat taken aback when I first stated I needed to do this (note, I didn't ask permission, just stated it needed to be done as part of the marriage process), but once I explained and we talked it through, it made sense to her. Of course, in the end it didn't matter.
Professor Emeritus
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Re: Pre-nup at only $1M networth, do I need it?

Post by Professor Emeritus »

HomerJ wrote:
Professor Emeritus wrote:
HomerJ wrote:
Professor Emeritus wrote:It is a partial commitment. That is a simple fact.
It's a full commitment, unless there is a divorce... at which point, the commitment has been broken. No divorce, no splitting of the assets...

Are you saying that someone who gets a divorce without a prenup has a fuller commitment to his/her partner than someone who gets a divorce with a prenup? In both cases, they are divorced, and the commitment is gone.

If a couple remains married, prenup means nothing.
Nonsense, It allows the wealthier spouse to walk out with no consequences. That is the whole point of a prenup. It is not a full commitment. Its limited liability corporation instead of a partnership.
It's not nearly as simple as that... 5,10,15 years down the road, especially if children are involved, no one is walking out without consequence. We're just talking about money made before the marriage, not during the marriage. It's a full partnership for everything done as partners.

Why would the poorer spouse be unwilling to sign a prenup?
(1) It only matters if there is a divorce
(2) it only affects money made before the marriage
(3) if the poorer spouse has any honor at all, he/she would not have any intention of claiming they deserve 50% of the money made before they even met their wealthier spouse.

The wealthier spouse is willing to share 100% of their money with the poorer spouse, full commitment... as long as they stay married. It's not like the OP is going to live in an expensive house without his wife or go on expensive vacations without her, saying "Oh, this is MY money, you can't afford these things".
I suspect you have not read a lot of prenups.
istoner
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Re: Pre-nup at only $1M networth, do I need it?

Post by istoner »

Momus wrote:
I think my decision is leaning to ask the girl for a pre-nup since there is no way I can tell for sure that a girl marries me for my money or love unless she signs one.
Wow. I think prenups are a bad idea. On the other hand, if it's not absolutely crystal clear in your mind whether your girl is marrying you for love or money, but you (for some reason) are set on getting married anyway, I would say *definitely* get one.
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Re: Pre-nup at only $1M networth, do I need it?

Post by istoner »

HomerJ wrote: The wealthier spouse is willing to share 100% of their money with the poorer spouse, full commitment... as long as they stay married. It's not like the OP is going to live in an expensive house without his wife or go on expensive vacations without her, saying "Oh, this is MY money, you can't afford these things".
That's sort of what it sounds like to me. There's a ton of "don't commingle assets!" "Protect *my* money!" talk in this thread. Is your spouse going to have access to your premarital assets? Is s/he going to have an equal ability to spend them? Or do you say "sorry honey, that's mine. You can't touch it. We have to keep these things separate. You understand...."
steve_14
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Re: Pre-nup at only $1M networth, do I need it?

Post by steve_14 »

istoner wrote:Wow. I think prenups are a bad idea. On the other hand, if it's not absolutely crystal clear in your mind whether your girl is marrying you for love or money, but you (for some reason) are set on getting married anyway, I would say *definitely* get one.
It's impossible to know exactly the mix of reasons someone is marrying you. A lot of times, the other party doesn't even know on a conscious level. If you're broke and unemployed, you can be reasonably certain money doesn't factor into the mix. If you're wealthy and s/he knows it, you can be reasonably certain it does. At least, you hope the other party is smart enough to consider such matters.
Individuals may marry for several reasons, including legal, social, libidinal, emotional, financial, spiritual, and religious purposes.
http://en.wikipedia.org/wiki/Marriage
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HomerJ
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Re: Pre-nup at only $1M networth, do I need it?

Post by HomerJ »

istoner wrote:
HomerJ wrote: The wealthier spouse is willing to share 100% of their money with the poorer spouse, full commitment... as long as they stay married. It's not like the OP is going to live in an expensive house without his wife or go on expensive vacations without her, saying "Oh, this is MY money, you can't afford these things".
That's sort of what it sounds like to me. There's a ton of "don't commingle assets!" "Protect *my* money!" talk in this thread. Is your spouse going to have access to your premarital assets? Is s/he going to have an equal ability to spend them? Or do you say "sorry honey, that's mine. You can't touch it. We have to keep these things separate. You understand...."
Well, they are usually tied up in retirement accounts, or maybe house equity, so no, the spouse usually won't have an ability to spend them...

Having a paid-off house (even if it's 100% in the wealthy spouse's name) does confer benefits to the "poorer" spouse (as long as they remain married).
dylanh
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Re: Pre-nup at only $1M networth, do I need it?

Post by dylanh »

Can anyone point me to a source for the idea that 50% (or more) of marriages end in divorce? I've seen it stated without support several times and I think OP should at least benefit from having accurate info in making this decision.

My understanding form reading articles over the years is that this statistic is flat wrong, and the real number is way lower. It was based on some figures that there are half as many divorces as marriages in a given year, but that is hardly the same thing. It ignore the millions of marriages that existed prior to the year.

I'll see what I can find again, but the last time I researched this, the few people who had actually made an attempt to figure this out concluded that the actual percentage of marriages ending in divorce was in the 20%-30% range.

cheers! :sharebeer

dylanh
flyingbison
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Re: Pre-nup at only $1M networth, do I need it?

Post by flyingbison »

dylanh wrote:Can anyone point me to a source for the idea that 50% (or more) of marriages end in divorce? I've seen it stated without support several times and I think OP should at least benefit from having accurate info in making this decision.

My understanding form reading articles over the years is that this statistic is flat wrong, and the real number is way lower. It was based on some figures that there are half as many divorces as marriages in a given year, but that is hardly the same thing. It ignore the millions of marriages that existed prior to the year.

I'll see what I can find again, but the last time I researched this, the few people who had actually made an attempt to figure this out concluded that the actual percentage of marriages ending in divorce was in the 20%-30% range.

cheers! :sharebeer

dylanh

There is no single, comprehensive source of data: http://www.cdc.gov/nchs/mardiv.htm

Marriage and divorce rates of the population, of course, are not predictive of the probability of divorce for any particular couple, and there are many variables that seem to play a role including age, income level, education, etc.
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Re: Pre-nup at only $1M networth, do I need it?

Post by Ketawa »

Professor Emeritus wrote:It is a partial commitment. That is a simple fact. I have no idea of the emotional depth of your partial commitment. My FIL had a partial commitment to his second wife. He certainly loved honored and cherished her. But he drew a line at finance.
Your marriage is also a partial commitment. You have a prenup defined by the state. I'm glad it works for you.
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SquawkIdent
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Re: Pre-nup at only $1M networth, do I need it?

Post by SquawkIdent »

A couple things to think about when considering whether or not to get a prenup:

1. People change over time and sometimes not for the better.

2. As time goes on people are influenced by others. Sometimes leading them down the wrong path of thinking.

3. IMHO some (not all) divorce lawyers make divorce seem like an easy solution to the problem. It's not, trust me.

4. Dependencies develop to. This never helps the situation and if the dependent person doesn't want to admit this and deal with it you are stuck. You either learn to live with it or are "forced" to remove yourself from the situation. For your own safety and well being. The same thing applies to mental illnesses that develop and are refused to be dealt with.

5. Once you are financially "comfortable" it can be viewed as a way out for one of the parties. Your partnership is no longer needed and the departing party can take "their share" and move on.

I know how it is to feel like this is the only time you will get married and you can trust your partner forever. I think that can happen but if it doesn't you should have something in place so you don't get wiped out financially and it takes years (or sometimes never) to recover. This has absolutely nothing to do with a full or half commitment. This has to deal with your future and realizing that you are in control of it and someone else can not destroy it with a single narcissistic act.

Good luck. :sharebeer
istoner
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Re: Pre-nup at only $1M networth, do I need it?

Post by istoner »

steve_14 wrote:
istoner wrote:Wow. I think prenups are a bad idea. On the other hand, if it's not absolutely crystal clear in your mind whether your girl is marrying you for love or money, but you (for some reason) are set on getting married anyway, I would say *definitely* get one.
It's impossible to know exactly the mix of reasons someone is marrying you. A lot of times, the other party doesn't even know on a conscious level. If you're broke and unemployed, you can be reasonably certain money doesn't factor into the mix. If you're wealthy and s/he knows it, you can be reasonably certain it does. At least, you hope the other party is smart enough to consider such matters.
I took OP to mean that he wants to tell whether she loves him and is in it for the long haul, or whether she has it in her to take his money and run (which is what a pre-nup would protect against), not if she has some sense of the benefits of financial security during a life spent together (to which a pre-nup is irrelevant).
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Re: Pre-nup at only $1M networth, do I need it?

Post by Professor Emeritus »

Ketawa wrote:
Professor Emeritus wrote:It is a partial commitment. That is a simple fact. I have no idea of the emotional depth of your partial commitment. My FIL had a partial commitment to his second wife. He certainly loved honored and cherished her. But he drew a line at finance.
Your marriage is also a partial commitment. You have a prenup defined by the state. I'm glad it works for you.
no, the legal status of a marriage is "defined" by the state. A prenup alters the definition of the relationship to limit it.
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Re: Pre-nup at only $1M networth, do I need it?

Post by Professor Emeritus »

istoner wrote:
steve_14 wrote:
istoner wrote:Wow. I think prenups are a bad idea. On the other hand, if it's not absolutely crystal clear in your mind whether your girl is marrying you for love or money, but you (for some reason) are set on getting married anyway, I would say *definitely* get one.
It's impossible to know exactly the mix of reasons someone is marrying you. A lot of times, the other party doesn't even know on a conscious level. If you're broke and unemployed, you can be reasonably certain money doesn't factor into the mix. If you're wealthy and s/he knows it, you can be reasonably certain it does. At least, you hope the other party is smart enough to consider such matters.
I took OP to mean that he wants to tell whether she loves him and is in it for the long haul, or whether she has it in her to take his money and run (which is what a pre-nup would protect against), not if she has some sense of the benefits of financial security during a life spent together (to which a pre-nup is irrelevant).

Read more prenups. The are normally leases. When you finish the ride you turn it back and Poof you are gone ..
During the ride they limit what you can do
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Re: Pre-nup at only $1M networth, do I need it?

Post by Calm Man »

denovo wrote:
Momus wrote:
sscritic wrote:
andronikus wrote:To the OP: [who lives in California - added by respondent]

The laws are not made in your favor, and the family court system is the last place you want to be deciding who gets what.
I don't know what you know about the laws of California. Now perhaps you think your responsibility to your children ends at the point that you deposit your seed in the proper receptacle, but even if you do, a pre-nup with that as a premise will not stand up in court. An pre-nup with illegal conditions is not going to do you much good.

Do you know the standard for spousal support in California? For example, does it last for a lifetime? What is the stated goal of spousal support in California?

And once again, I have to ask if you understand community and separate property as they are defined and applied in California? If you don't know California law, why are you advising someone living in California? I don't know that you don't know California law, but since you made no reference to California in your response, I don't think you were really addressing the OP, in spite of the fact you said your response was addressed to the OP.
I am a controlled experiment. Marriage 1 had no prenup. Marriage 2 had a prenup. The first was far more complex. The second included the wrath of a woman scorned (!!!) but my legal grief was limited to my lawyer defending our prenup as being valid.....

I think my decision is leaning to ask the girl for a pre-nup since there is no way I can tell for sure that a girl marries me for my money or love unless she signs one.

Would the separate assets you own before you get married (the one that keeps generating new income/dividend) become community property after one gets married?

Say you have a stock portfolio/rental house before you get married that makes $30k in dividend/rent every year? Do you have to distribute 1/2 of the income immediately after you get married to the spouse to keep stuff separate (so you don't comingle it)? It can become very complex. How does one do this?
You've come to the right decision. Congratulations. The only people whose answers you should take seriously are those who have gotten divorced without a pre-nup with considerable assets in their favor. Among them, I bet the answer would be near unanimous that you should have one to protect yourself. Asking people who have never been divorced, is pointless. Even if you're sure about her now, people change. A pre-nup is an insurance policy, and a cheap cost-effective one at that.
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Re: Pre-nup at only $1M networth, do I need it?

Post by dylanh »

flyingbison wrote:
dylanh wrote:Can anyone point me to a source for the idea that 50% (or more) of marriages end in divorce? I've seen it stated without support several times and I think OP should at least benefit from having accurate info in making this decision.

My understanding form reading articles over the years is that this statistic is flat wrong, and the real number is way lower. It was based on some figures that there are half as many divorces as marriages in a given year, but that is hardly the same thing. It ignore the millions of marriages that existed prior to the year.

I'll see what I can find again, but the last time I researched this, the few people who had actually made an attempt to figure this out concluded that the actual percentage of marriages ending in divorce was in the 20%-30% range.

cheers! :sharebeer

dylanh

There is no single, comprehensive source of data: http://www.cdc.gov/nchs/mardiv.htm

Marriage and divorce rates of the population, of course, are not predictive of the probability of divorce for any particular couple, and there are many variables that seem to play a role including age, income level, education, etc.

Thanks! In case you can save me the time of doing a deep dive into CDC facts and figures, are you aware of any statisitics they have that back up the 50% (or more) of marriages end in divorce? As far as I can tell, and I am no expert, that figure appears to be nothing more than an urban legend. 50% of marriages end in divorce=eating pop rocks and coke at the same time will kill you...
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Re: Pre-nup at only $1M networth, do I need it?

Post by Call_Me_Op »

Best regards, -Op | | "In the middle of difficulty lies opportunity." Einstein
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Re: Pre-nup at only $1M networth, do I need it?

Post by music_man »

Whether you are for or against pre-nups, people always seem to have a knee-jerk reaction if someone else asks the question "Should I get a pre-nup". Only the person asking the question knows why they are truly asking for it. Everyone else has their opinions about it, but they are really just making assumptions about the person who's asking and projecting their own feelings about it. There's probably a dozen or so reasons why people want to get a pre-nup:

1. You want to protect inheritance for kids from previous marriage.
2. You don't trust the other person enough.
3. You do trust and love them, but you also have the acknowledgement that you're both human and prone to imperfections, maybe things don't always work out as planned for any number of reasons you can't foresee.
4 ...The list goes on...

My point is, the OP asking really should ask why he wants the pre-nup, everyone else's opinion is just noise. I don't think anyone including Professor Emeritus knows any individual enough to say that person isn't fully committed in the relationship - -not to say that their are people like that, but you can't assume everyone is like what you are thinking just because they want a pre-nup. Maybe OP's reasoning is #3 above, in which good idea to get pre-nup. Maybe it's #2, in which case, maybe rethink why you want to marry the person.
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Re: Pre-nup at only $1M networth, do I need it?

Post by Ketawa »

Professor Emeritus wrote:
Ketawa wrote:
Professor Emeritus wrote:It is a partial commitment. That is a simple fact. I have no idea of the emotional depth of your partial commitment. My FIL had a partial commitment to his second wife. He certainly loved honored and cherished her. But he drew a line at finance.
Your marriage is also a partial commitment. You have a prenup defined by the state. I'm glad it works for you.
no, the legal status of a marriage is "defined" by the state. A prenup alters the definition of the relationship to limit it.
Hilarious. The only contract acceptable for a marriage is the one defined by whatever particular state's laws apply? Then why don't we have one set of marriage laws for every state? Prenups alter the legal relationship, but don't limit it unless you presume that the contract defined by the state is the best one for your situation.
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Re: Pre-nup at only $1M networth, do I need it?

Post by dylanh »

Probably nobody cares about this as much as I do, but I looked at the link. The footnote for the 50% reference cites back to two academic journals. The one I was able to access said that as of 1995 approx. 43% of all marriages ended in divorce. That cited to census data it didn't describe or really identify, so I couldn't verify. However, everybody seems to agree that the divorce rate has steadily declined siince its heights in the 1980s, so if I were forced to make an estimate at this point, I would say that somewhere less than 43% of marriages (and most likely a good bet less than 43%) will end in divorce. The divorce rate as of 2009 appears to be about 84-85% of what it was in 1995, so make of that what you will.

Will people stop saying 50% or more of marriages will end in divorce, probably not. Will people stop spreading a certain rumor about Richard Gere, unlikely as well.

Back to my actual job...

dylanh
Louis Winthorpe III
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Re: Pre-nup at only $1M networth, do I need it?

Post by Louis Winthorpe III »

These threads are always interesting. I'll just point out that this board is for people who spend a lot of time thinking about how to build and preserve wealth. Somewhere out there, there's probably a board for people who want to share thoughts about relationships, marriage, family, etc. Just guessing the responses on the two boards would skew in opposite directions.
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Re: Pre-nup at only $1M networth, do I need it?

Post by reggiesimpson »

1.Yes. Get a solid prenup.
2. You and your folks need to see an estate atty right now.
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Re: Pre-nup at only $1M networth, do I need it?

Post by RobInCT »

I think this is a relationship question and not a finance question. I make considerably more than my long-term girlfriend. We're both single, never been married, no kids (yet). If we ever decide to marry, I would not ask for a pre-nup. The only situation in which I would consider a pre-nup is one in which one of us had been previously married and/or had children from a prior relationship.

This has everything to do with my feelings about marriage and nothing to do with my feelings about financial planning. Other people may have different feelings about marriage and may choose differently for themselves. There is no right answer here.
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Re: Pre-nup at only $1M networth, do I need it?

Post by Call_Me_Op »

RobInCT wrote:I think this is a relationship question and not a finance question. I make considerably more than my long-term girlfriend. We're both single, never been married, no kids (yet). If we ever decide to marry, I would not ask for a pre-nup. The only situation in which I would consider a pre-nup is one in which one of us had been previously married and/or had children from a prior relationship.

This has everything to do with my feelings about marriage and nothing to do with my feelings about financial planning. Other people may have different feelings about marriage and may choose differently for themselves. There is no right answer here.
I think it's one thing to make considerably more - and quite another to enter the relationship with a significant disparity in net worth.
Best regards, -Op | | "In the middle of difficulty lies opportunity." Einstein
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Re: Pre-nup at only $1M networth, do I need it?

Post by RobInCT »

Call_Me_Op wrote:
RobInCT wrote:I think this is a relationship question and not a finance question. I make considerably more than my long-term girlfriend. We're both single, never been married, no kids (yet). If we ever decide to marry, I would not ask for a pre-nup. The only situation in which I would consider a pre-nup is one in which one of us had been previously married and/or had children from a prior relationship.

This has everything to do with my feelings about marriage and nothing to do with my feelings about financial planning. Other people may have different feelings about marriage and may choose differently for themselves. There is no right answer here.
I think it's one thing to make considerably more - and quite another to enter the relationship with a significant disparity in net worth.
Okay. I have a considerably higher net worth than my long-term girlfriend. We're both single, never been married, no kids (yet). If we ever decide to marry, I would not ask for a pre-nup. The only situation in which I would consider a pre-nup is one in which one of us had been previously married and/or had children from a prior relationship.

This has everything to do with my feelings about marriage and nothing to do with my feelings about financial planning.
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Re: Pre-nup at only $1M networth, do I need it?

Post by chaz »

reggiesimpson wrote:1.Yes. Get a solid prenup.
2. You and your folks need to see an estate atty right now.
I agree!!
Chaz | | “Money is better than poverty, if only for financial reasons." Woody Allen | | http://www.bogleheads.org/wiki/index.php/Main_Page
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Re: Pre-nup at only $1M networth, do I need it?

Post by HomerJ »

RobInCT wrote:There is no right answer here.
Pretty wise comment here.
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Re: Pre-nup at only $1M networth, do I need it?

Post by sscritic »

Momus, a week ago on Thu May 29, 2014 wrote: Would the separate assets you own before you get married (the one that keeps generating new income/dividend) become community property after one gets married?

Say you have a stock portfolio/rental house before you get married that makes $30k in dividend/rent every year? Do you have to distribute 1/2 of the income immediately after you get married to the spouse to keep stuff separate (so you don't comingle it)? It can become very complex. How does one do this?
I note that while I was in rehab for the last week, no one tried to answer your question. Perhaps there aren't any bogleheads who live in the Great State of California, but I doubt that that's the fact Jack.

So let me, as a resident of the Great State of California, as someone who was divorced in the Great State of California, and who learned to read in the Great State of California,* help you out.

I actually gave the answer earlier, so anyone else who was reading along could have helped you, but alas, that was not to be. I guess my post got lost among all the posts about Idaho and North Dakota and Missouri. So here goes:

California Family Code section 770.
770. (a) Separate property of a married person includes all of the
following:
(1) All property owned by the person before marriage.
(2) All property acquired by the person after marriage by gift,
bequest, devise, or descent.
(3) The rents, issues, and profits of the property described in
this section.

(b) A married person may, without the consent of the person's
spouse, convey the person's separate property.
The rents you collect on the property that you owned before marriage [see (1); it is property described in this section] are your separate property. There is no need to divide them, split them, or treat them as community property. The law in Texas is not the same, but you and I live in the Great State of California, so we don't care what happens in Texas, or Ohio, or Georgia, or any of the other 46 irrelevant states. The only state that matters is the Great State of California.

Note that this does not preclude you from consciously or unconsciously transmuting the property to community property. To learn about transmutation, read California Family Code sections 850 - 853. Note in particular this reference to real and other property, including financial assets:
852 (d) Nothing in this section affects the law governing
characterization of property in which separate property and community
property are commingled or otherwise combined.
This is where the unconscious might come in. I highly recommend staying conscious while making financial decisions.

For the most part, my ex-wife and I were able to keep separate separate, but we did not have the advantage of having studied this excellent tutorial. Much of what I learned was after the marriage but long before the divorce.

One aspect of Financial Literacy, as promoted by the John C. Bogle Center for Financial Literacy, is that you know the laws of the city, county, and state where you live. You and I live in the Great State of California, so we both need to know the laws that apply to us as residents thereof. We really don't need to care one whit for the laws of any other state.



* I lie, I started learning to read in the Great State of Washington. I never learned to read in the Great State of New Hampshire, so New Hampshire neither gets the credit nor the blame for my reading skills.
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Re: Pre-nup at only $1M networth, do I need it?

Post by denovo »

What if the law changes? What if the divorcing spouse claims they helped find tenants, schedule repairs, and then wants a piece?
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sscritic
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Re: Pre-nup at only $1M networth, do I need it?

Post by sscritic »

denovo wrote:What if the law changes? What if the divorcing spouse claims they helped find tenants, schedule repairs, and then wants a piece?
Don't you pay your spouse when he works on your separate property? If you aren't going to pay your spouse, you should get a gift receipt. :)

P.S. Can you tell us what piece he would get? What does the law of the Great State of California say on this issue?

P.P.S. Speculating about changes in the law are against forum policy. Please click the link above; it is labeled Forum Policy.
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Re: Pre-nup at only $1M networth, do I need it?

Post by sscritic »

Added: I helped my ex-wife with her separate property, including overseeing of the installation of flooring and landscaping and dealing with tenants and real estate agents. I would never stoop so low as to make a claim against her separate property, but I guess my ex just did a great job of picking a husband with integrity.
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Re: Pre-nup at only $1M networth, do I need it?

Post by LadyGeek »

I removed a number of off-topic comments. This thread has run its course and is locked (discussion straying in several different directions, no longer addressing the OP's concern). See: Forum Policy
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