Prenuptial agreement for moderately successful 30 year olds

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OriolesFan89
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Prenuptial agreement for moderately successful 30 year olds

Post by OriolesFan89 » Wed Oct 16, 2019 11:01 am

I'm getting married to my girlfriend of nearly 10 years. We met at the end of college and will be 30 and 31 years old when we get married in December. It's an exciting time for us!

Due to my parents paying for my 5 years of out of state college, many years of $10k birthday checks from grandma, and being a sound investor, I have been able to accumulate a few bucks. She is no slouch either.

We have lived together for almost 3 years and have jointly shared our expenses during this time. We have tracked our net worth on a monthly basis since 2013 when I had $136k and she had -$50k (still lots of student loans). We invested a combined $85k last year and will be around $95k in by the end of 2019. We're in consulting fields where our salaries will not jump up leaps and bounds in the future. A 50% increase over the next 6-10 years, assuming we both keep working, is probably fair. I manage our investments which are spread across all the accounts you'd probably guess - Roth 401k, traditional 401k, Roth IRA, traditional IRA, HSA, high-yield savings for emergency fund, and an ESOP.
Hers - $175k in assets. No debt. $105k salary.
His - $825k plus about $100k of equity in our $325k house that I've lived in for 7 years. No debt aside from mortgage. $120k salary.

I've heard that getting prenuptial agreements is getting more popular since we're getting married at a later stage in life. Our concern is more about if something ugly does happen in the future, we'd much rather it be a clean split rather than shelling out tens of thousands to a law firm. We are hoping to have our first child in the next 18-24 months, with the possibility of one of us leaving or going part time in the workforce after that... more likely me! We have a meeting with an attorney who does wills, prenups, and that kind of thing in a couple of weeks.

I'm seeking recommendations on how to construct that prenuptial agreement. Obviously, we wouldn't want to screw over the other person but want something that would easily be executed. I had roughly $500k of investments and she had $0k when we moved in together in early 2013 and began sharing our expenses so "protecting" that $500k as mine is an idea. Combining that with an agreement to not pay an on-going alimony (based on salary) was an idea that we had.

Seeking advice on this plan and looking for guidance! Thanks, Bogleheads.

junior
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Re: Prenuptial agreement for moderately successful 30 year olds

Post by junior » Wed Oct 16, 2019 11:36 am

I believe the lawyer will tell you that you each need separate lawyers before signing any prenup, one to represent each of you. Just a heads up.

Ependytis
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Re: Prenuptial agreement for moderately successful 30 year olds

Post by Ependytis » Wed Oct 16, 2019 11:40 am

As they say, you can either go with the government contract or marriage license or develop your own in the form of a prenup. I strongly recommend you develop your own. I would challenge anybody to bring up a contract that is as one-sided as the government marital contract. I know too many people who will not get remarried, although they are in a relationship, because they are collecting maintenance or alimony. On the other side of the coin, there are those still paying alimony in retirement decades after the divorce. If you are blessed to have a great marriage then the prenup will never come up. We have employment insurance, disability insurance, homeowners insurance, liability insurance, life insurance, and fire insurance for events that are much less likely than a divorce. For whatever reason it doesn’t work, where do you want to end up?

dknightd
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Re: Prenuptial agreement for moderately successful 30 year olds

Post by dknightd » Wed Oct 16, 2019 11:47 am

Do whatever makes you both happy

KT785
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Re: Prenuptial agreement for moderately successful 30 year olds

Post by KT785 » Wed Oct 16, 2019 11:50 am

OriolesFan89 wrote:
Wed Oct 16, 2019 11:01 am
I've heard that getting prenuptial agreements is getting more popular since we're getting married at a later stage in life.
30 is a "later stage in life"? I'm 32 so I must be downright decrepit :P

I'd make sure you two are both truly on board with getting a prenup; if one of you is driving in that direction and the other one is just going along, it could contribute to problems later.

My wife and I met college and have been together since we were 20 (me) and 19 (her) and are now 32 and 31; however, we married right after I graduated from law school (6 years ago).

Perhaps my wife and I are old-fashioned . . . all accounts are joint, all income/assets/etc. are ours regardless of the source (my income is over twice my wife's) and all assets brought to the marriage are for our mutual benefit.

My view is that prenuptial agreements are more appropriately geared toward those who are older, particularly those who've been married before and may have children from the previous marriage.

KT785

knightrider
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Re: Prenuptial agreement for moderately successful 30 year olds

Post by knightrider » Wed Oct 16, 2019 11:53 am

OriolesFan89 wrote:
Wed Oct 16, 2019 11:01 am
Hers - $175k in assets. No debt. $105k salary.
His - $825k plus about $100k of equity in our $325k house that I've lived in for 7 years. No debt aside from mortgage. $120k salary.
I am no expert, but doesn't sound like a prenup is needed for this situation. Since you both earn similar amounts, then there is nothing really to split between you. My understanding is any assets you have before marriage will remain yours.

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Re: Prenuptial agreement for moderately successful 30 year olds

Post by RickBoglehead » Wed Oct 16, 2019 11:56 am

I can't conceive of needing this. When we got married, not only did my wife not have a dime to her name, she was in debt to me - i.e. I was footing the bills because we had just graduated college, and she had nothing. She got a job that was under a government grant and I had to fill out paperwork showing her indebtedness to me...

Over the nearly 39 years of marriage, 41 together, we've amassed a nice amount for retirement. If I had to guess, 90% of that came from my work, not hers. She got a small inheritance, I got a pre-inheritance gift from a relative that specified that it would be 50/50.

In short, what's hers is mine, what's mine is hers, it's all OURS.

Unless it's a 2nd marriage with children, or you're wealthy beyond belief, no prenup should be needed IMO.

IANAL
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drawpoker
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Re: Prenuptial agreement for moderately successful 30 year olds

Post by drawpoker » Wed Oct 16, 2019 11:57 am

Google -

"2019 Average Age of Marriage for Man + Woman. According to the most recent 2018 estimates from the U.S. Census Bureau, the average age of first marriage for women in 2018-2019 is approximately 28 years old. For men, it is approximately 30 years old.Feb 26, 2019"

Am really Trying Hard to recognize the need for a pre-nup when the salaries of bride and groom are $105,000 and $120,000 respectively.

HomeStretch
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Re: Prenuptial agreement for moderately successful 30 year olds

Post by HomeStretch » Wed Oct 16, 2019 12:07 pm

Congratulations on your upcoming wedding!

Use your meeting with the attorney to lay out your goals, get advice and then decide what to do. At a minimum, get the basics done and ready to sign when married (i.e., Wills, financial power of attorneys, healthcare power of attorneys/directives). With similar incomes, if your goal is to clearly identify “his” and “her” assets before marriage and to make sure each would leave the marriage with those individual assets intact, discuss your goal with the attorney. You will get advice on how to keep your pre-marriage assets separate and whether a pre-nup agreement is even necessary.

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Re: Prenuptial agreement for moderately successful 30 year olds

Post by dknightd » Wed Oct 16, 2019 12:15 pm

KT785 wrote:
Wed Oct 16, 2019 11:50 am
OriolesFan89 wrote:
Wed Oct 16, 2019 11:01 am
I've heard that getting prenuptial agreements is getting more popular since we're getting married at a later stage in life.
30 is a "later stage in life"? I'm 32 so I must be downright decrepit :P

I'd make sure you two are both truly on board with getting a prenup; if one of you is driving in that direction and the other one is just going along, it could contribute to problems later.

My wife and I met college and have been together since we were 20 (me) and 19 (her) and are now 32 and 31; however, we married right after I graduated from law school (6 years ago).

Perhaps my wife and I are old-fashioned . . . all accounts are joint, all income/assets/etc. are ours regardless of the source (my income is over twice my wife's) and all assets brought to the marriage are for our mutual benefit.

My view is that prenuptial agreements are more appropriately geared toward those who are older, particularly those who've been married before and may have children from the previous marriage.

KT785
I agree

sd323232
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Re: Prenuptial agreement for moderately successful 30 year olds

Post by sd323232 » Wed Oct 16, 2019 12:30 pm

Many older bogleheads dont understand that times have changed. Marriages dont last. I'm also in my 30s as OP.

OP, this is great way to protect your capital. Many people start prenup shaming us just because they had 50-60-70 year marriages. They dont understand how happy they are having such a long marriages and expect us to be like them. They never had to go through horrible experience like divorce. Talk to lawyer and follow through on your prenup. Wish you luck in your marriage my friend!

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WingsFan4Life
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Re: Prenuptial agreement for moderately successful 30 year olds

Post by WingsFan4Life » Wed Oct 16, 2019 12:46 pm

sd323232 wrote:
Wed Oct 16, 2019 12:30 pm
Many older bogleheads dont understand that times have changed. Marriages dont last. I'm also in my 30s as OP.

OP, this is great way to protect your capital. Many people start prenup shaming us just because they had 50-60-70 year marriages. They dont understand how happy they are having such a long marriages and expect us to be like them. They never had to go through horrible experience like divorce. Talk to lawyer and follow through on your prenup. Wish you luck in your marriage my friend!
I wouldn't have gotten married if I thought I needed a prenup, but to each their own.

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Re: Prenuptial agreement for moderately successful 30 year olds

Post by supersharpie » Wed Oct 16, 2019 12:52 pm

sd323232 wrote:
Wed Oct 16, 2019 12:30 pm
Many older bogleheads dont understand that times have changed. Marriages dont last. I'm also in my 30s as OP.

OP, this is great way to protect your capital. Many people start prenup shaming us just because they had 50-60-70 year marriages. They dont understand how happy they are having such a long marriages and expect us to be like them. They never had to go through horrible experience like divorce. Talk to lawyer and follow through on your prenup. Wish you luck in your marriage my friend!
I'm 36. What's the point in getting married if you don't believe in the institution? It's illogical.

Why not just remain long term domestic partners until the inevitable break-up?

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Re: Prenuptial agreement for moderately successful 30 year olds

Post by deltaneutral83 » Wed Oct 16, 2019 12:53 pm

My wife and I met college and have been together since we were 20 (me) and 19 (her) and are now 32 and 31; however, we married right after I graduated from law school (6 years ago).

Perhaps my wife and I are old-fashioned . . . all accounts are joint, all income/assets/etc. are ours regardless of the source (my income is over twice my wife's) and all assets brought to the marriage are for our mutual benefit.
Sounds like the difference in net worth at marriage was minimal, therefore no need to worry. Any monies made afterward are marital property to split evenly?

I am no expert, but doesn't sound like a prenup is needed for this situation. Since you both earn similar amounts, then there is nothing really to split between you. My understanding is any assets you have before marriage will remain yours.
Top
IANAL either, but I don't think this is necessarily accurate; once you start co mingling monies after marriage, waters get muddy, and a family attorney charging $400 an hour would love to take his time to clear up those waters if necessary when the unfortunate time came. So if the spouse with the higher net worth had a taxable brokerage account and never touched it after the wedding day, would the compounding on the account be individual or marital property? How about if OP sold off some index funds in a taxable account after the wedding to invest in real estate, is that being tracked to make sure it's individual? What about 401k contributions after the wedding, since those monies are now marital property, the 401k now has commingled assets? The "What you come into the marriage with is yours" just doesn't seem feasible both legally and practically without a prenup, but again, I do not know the laws around that.

As OP states, there is a difference in net worth of $650k roughly. At a 7% interest rate over the years, were talking $2 mil after 18 years. It's an individual decision but the "I am old fashioned and we got married at 22 and were broke and everything is joint" is a totally separate conversation altogether that I see a lot of people posting with regards to the topic.
I can't conceive of needing this. When we got married, not only did my wife not have a dime to her name, she was in debt to me - i.e. I was footing the bills because we had just graduated college, and she had nothing. She got a job that was under a government grant and I had to fill out paperwork showing her indebtedness to me...
This never stated what Spouse #1's (who's footing the bills) net worth was on the wedding day? If close to $0, then a prenuptial agreement isn't even a conversation in legal terms let alone moral (this kind of assumes 7 figure salaries aren't on the horizon, but again, that would be yet another topic).
Am really Trying Hard to recognize the need for a pre-nup when the salaries of bride and groom are $105,000 and $120,000 respectively
goes back to the commingling questions and all that comes with it after the wedding as the difference in net worth is $650k with the lesser of the two NW's being 1/5 the larger and much closer to $0, again IANAL.
Last edited by deltaneutral83 on Wed Oct 16, 2019 1:05 pm, edited 6 times in total.

runner540
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Re: Prenuptial agreement for moderately successful 30 year olds

Post by runner540 » Wed Oct 16, 2019 12:54 pm

How will your agreement work if one of you moves for the other's career, or one gets sick and can't work, or doesn't work full time to care for children? Do you want those life decisions to be based on a formula you create now or what's best for your family as a unit later on?

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Re: Prenuptial agreement for moderately successful 30 year olds

Post by Lazareth » Wed Oct 16, 2019 1:07 pm

I see replies such as, “You don’t need a pre-nup…look at us, been married 40 years!” That’s like saying you don’t need life insurance, look at me I’ve been alive 65 years!”
It’s an insurance policy, and having similar incomes does NOT negate the need for a pre-nup or some written understanding of finances.
"I want to light the lights of patriotism." - Lech Walesa

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Re: Prenuptial agreement for moderately successful 30 year olds

Post by Silence Dogood » Wed Oct 16, 2019 1:12 pm

sd323232 wrote:
Wed Oct 16, 2019 12:30 pm
Many older bogleheads dont understand that times have changed. Marriages dont last. I'm also in my 30s as OP.

OP, this is great way to protect your capital. Many people start prenup shaming us just because they had 50-60-70 year marriages. They dont understand how happy they are having such a long marriages and expect us to be like them. They never had to go through horrible experience like divorce. Talk to lawyer and follow through on your prenup. Wish you luck in your marriage my friend!
Marriages don't last? The divorce rate for millennials is actually lower than that of older generations.

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Re: Prenuptial agreement for moderately successful 30 year olds

Post by WingsFan4Life » Wed Oct 16, 2019 1:14 pm

Silence Dogood wrote:
Wed Oct 16, 2019 1:12 pm
sd323232 wrote:
Wed Oct 16, 2019 12:30 pm
Many older bogleheads dont understand that times have changed. Marriages dont last. I'm also in my 30s as OP.

OP, this is great way to protect your capital. Many people start prenup shaming us just because they had 50-60-70 year marriages. They dont understand how happy they are having such a long marriages and expect us to be like them. They never had to go through horrible experience like divorce. Talk to lawyer and follow through on your prenup. Wish you luck in your marriage my friend!
Marriages don't last? The divorce rate for millennials is actually lower than that of older generations.
Give it time :twisted:

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Re: Prenuptial agreement for moderately successful 30 year olds

Post by oldfatguy » Wed Oct 16, 2019 1:14 pm

Silence Dogood wrote:
Wed Oct 16, 2019 1:12 pm
sd323232 wrote:
Wed Oct 16, 2019 12:30 pm
Many older bogleheads dont understand that times have changed. Marriages dont last. I'm also in my 30s as OP.

OP, this is great way to protect your capital. Many people start prenup shaming us just because they had 50-60-70 year marriages. They dont understand how happy they are having such a long marriages and expect us to be like them. They never had to go through horrible experience like divorce. Talk to lawyer and follow through on your prenup. Wish you luck in your marriage my friend!
Marriages don't last? The divorce rate for millennials is actually lower than that of older generations.
That's likely because many of them are more recently married and won't get divorced for another 5-10 years. :P

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Re: Prenuptial agreement for moderately successful 30 year olds

Post by deltaneutral83 » Wed Oct 16, 2019 1:15 pm

Silence Dogood wrote:
Wed Oct 16, 2019 1:12 pm
Marriages don't last? The divorce rate for millennials is actually lower than that of older generations.
Again, this is mostly off topic. The rate of divorce could be 10%, it still wouldn't negate the needs and priorities of the OP. On top of that the oldest millennial isn't even 40 so how would such a poll be conducted practically

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Re: Prenuptial agreement for moderately successful 30 year olds

Post by Silence Dogood » Wed Oct 16, 2019 1:19 pm

deltaneutral83 wrote:
Wed Oct 16, 2019 1:15 pm
Silence Dogood wrote:
Wed Oct 16, 2019 1:12 pm
Marriages don't last? The divorce rate for millennials is actually lower than that of older generations.
Again, this is mostly off topic. The rate of divorce could be 10%, it still wouldn't negate the needs and priorities of the OP. On top of that the oldest millennial isn't even 40 so how would such a poll be conducted practically
I did not make any statement regarding the needs of the OP.

Please include the context of what I was responding to when you quote me.
sd323232 wrote:
Wed Oct 16, 2019 12:30 pm
Many older bogleheads dont understand that times have changed. Marriages dont last. I'm also in my 30s as OP.

OP, this is great way to protect your capital. Many people start prenup shaming us just because they had 50-60-70 year marriages. They dont understand how happy they are having such a long marriages and expect us to be like them. They never had to go through horrible experience like divorce. Talk to lawyer and follow through on your prenup. Wish you luck in your marriage my friend!

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Re: Prenuptial agreement for moderately successful 30 year olds

Post by TomatoTomahto » Wed Oct 16, 2019 1:21 pm

supersharpie wrote:
Wed Oct 16, 2019 12:52 pm
sd323232 wrote:
Wed Oct 16, 2019 12:30 pm
Many older bogleheads dont understand that times have changed. Marriages dont last. I'm also in my 30s as OP.

OP, this is great way to protect your capital. Many people start prenup shaming us just because they had 50-60-70 year marriages. They dont understand how happy they are having such a long marriages and expect us to be like them. They never had to go through horrible experience like divorce. Talk to lawyer and follow through on your prenup. Wish you luck in your marriage my friend!
I'm 36. What's the point in getting married if you don't believe in the institution? It's illogical.

Why not just remain long term domestic partners until the inevitable break-up?
How about if you decide, as a couple, to have one of you stay home to care for children? There are careers, software development is the example that come to mind since it was my career before I became a StayAtHomeDad, where you can’t “just go back to work” after a number of years at your old level of compensation. You can’t depend on Courts to do the right thing, as I discovered after my first marriage.
Okay, I get it; I won't be political or controversial. The Earth is flat.

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Re: Prenuptial agreement for moderately successful 30 year olds

Post by KyleAAA » Wed Oct 16, 2019 1:22 pm

Sure, if your future wife is on board with it. You will need two separate lawyers if you want this not to be thrown out in court. Depending on your state, pre-marital assets are probably already protected so I'm not sure there's any additional value in a pre-nup. Could be a waste of time and money. All you need to do is make sure you don't add her name to the bank account or transfer it to a co-mingled account. Done.
Last edited by KyleAAA on Wed Oct 16, 2019 1:28 pm, edited 1 time in total.

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Re: Prenuptial agreement for moderately successful 30 year olds

Post by drawpoker » Wed Oct 16, 2019 1:25 pm

Lazareth wrote:
Wed Oct 16, 2019 1:07 pm
.....like saying you don’t need life insurance, look at me I’ve been alive 65 years!”
It’s an insurance policy, and having similar incomes does NOT negate the need for a pre-nup or some written understanding of finances.
Bad analogy. The insurance policy part, that is.

Pre-nups can get overturned, thrown out by judges, all the time.

If the OP is in Calif. he is already starting out on the wrong foot with his idea of using just one attorney. According to this anyway.

https://info.legalzoom.com/can-prenupti ... 26384.html

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Re: Prenuptial agreement for moderately successful 30 year olds

Post by Ependytis » Wed Oct 16, 2019 1:33 pm

I think in this thread emotional versus rational reasons for a prenup are being mixed up. The greatest destroyer of wealth is divorce. There are 4 ways to manage this risk.

1) You could accept the risk of divorce like some have suggested and get married with no prenup.
2) You could avoid the risk of divorce by not getting married.
3) You could mitigate the risk by having a prenup.
4) Lastly and maybe the most contentious, you could exploit the risk by marrying somebody that has significantly more money than you do.

Everyone has to choose for themselves what risk makes sense for them and what they can ultimately live with.

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Re: Prenuptial agreement for moderately successful 30 year olds

Post by dm200 » Wed Oct 16, 2019 1:34 pm

I am, certainly, no "expert" on marriage - and the older I get - the less I seem to "understand".

My wife and I (first and only marriage for both of us) have been married for 41+ years. We got married about 2 years after we started dating - and neither of us dated anyone else after our first date. Things moved quickly in many respects. I was 32 and my wife was 27 when we were married.

Ten years sure seems (to me) a very long time "together" before being married.

Both my parents and my wife's parents were only married once (to each other). My one brother has been married (his only marriage) for almost 40 years - although his wife was married for a short time before and had one small child - with her first husband - when they were married.

My closest relatives - that grew up nearby - aunts/uncles/cousins/etc. - 3 generations - have almost all been married only once - and remained married until their deaths (in cases of older relatives).

So, while I agree that the "odds" of staying married have, overall, gone down in the last 50+ years or so - there are many examples today of long lasting marriages.

Again - I am no "marriage" expert - and know less each and every passing year.

On the "pre-nup" issue - in your situations - maybe a 'pre-nup' makes sense - but I also might take an approach of keeping the large assets very separate - although, for marital harmony - disclose such to each other. This probably depends on applicable state law. I would certainly consult (together) an experienced attorney to have him/her explain all the rules for your situations. Then, I agree with others that each having separate attorneys would make sense if any documents, such as 'pre-nups' are done.
Last edited by dm200 on Wed Oct 16, 2019 1:39 pm, edited 1 time in total.

dknightd
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Re: Prenuptial agreement for moderately successful 30 year olds

Post by dknightd » Wed Oct 16, 2019 1:35 pm

If you want to hire two lawyers before you get married that is up to you. Again do what makes you both happy.

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Re: Prenuptial agreement for moderately successful 30 year olds

Post by Silence Dogood » Wed Oct 16, 2019 1:39 pm

WingsFan4Life wrote:
Wed Oct 16, 2019 1:14 pm
Give it time :twisted:
oldfatguy wrote:
Wed Oct 16, 2019 1:14 pm
That's likely because many of them are more recently married and won't get divorced for another 5-10 years. :P
deltaneutral83 wrote:
Wed Oct 16, 2019 1:15 pm
... the oldest millennial isn't even 40 so how would such a poll be conducted practically
I would encourage you to look at the statistics.

The divorce rate for millennials is lower and it has nothing to do with the fact that millennials are still young.

samsdad
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Re: Prenuptial agreement for moderately successful 30 year olds

Post by samsdad » Wed Oct 16, 2019 1:41 pm

If you think you need a prenup, maybe you should think about marrying the lawyer that you’re hiring instead. After all, you are ostensibly trusting the lawyer to protect you more than how your future spouse might someday. Isn’t that what you’re worried about at the end of the day? Your money?

Methinks you should worry more about your judgment than your money quite frankly. If you don’t trust this person with your very life, perhaps it’s time to find someone else. Finding the right person in the world for you would be a better idea than finding the right prenup. This should be easy: there’s never been more “fish in the sea” in history. Or lawyers. :twisted:

Source: am lawyer, married to lawyer, no prenup.

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Re: Prenuptial agreement for moderately successful 30 year olds

Post by AnonLady » Wed Oct 16, 2019 1:44 pm

knightrider wrote:
Wed Oct 16, 2019 11:53 am
OriolesFan89 wrote:
Wed Oct 16, 2019 11:01 am
Hers - $175k in assets. No debt. $105k salary.
His - $825k plus about $100k of equity in our $325k house that I've lived in for 7 years. No debt aside from mortgage. $120k salary.
I am no expert, but doesn't sound like a prenup is needed for this situation. Since you both earn similar amounts, then there is nothing really to split between you. My understanding is any assets you have before marriage will remain yours.
Assets from before the marriage are yours to keep, but the GROWTH of those assets are split, either 50/50 or "equitably", depending on your state.

I have been bitten by this rule twice and I don't recommend letting it bite you if you can avoid it. But I would also recommend some sort of pre-marriage counseling too, even moreso than a prenup. Divorce sucks even without all the financial issues, better to make sure the marriage starts out on the best footing and with good communication and agreement on all major issues that often lead to divorce (to avoid a divorce, fingers crossed) than a lock tight prenup after a divorce.

Best of luck in your nuptials!

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Re: Prenuptial agreement for moderately successful 30 year olds

Post by junior » Wed Oct 16, 2019 1:46 pm

You asked the wrong question.

You should have asked "What are the advantages and disadvantages of a prenup?"

Since you've already decided on one the only question that remains is How can the couple write a prenup they are okay with?

Only the couple can answer that one.

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Re: Prenuptial agreement for moderately successful 30 year olds

Post by bengal22 » Wed Oct 16, 2019 1:52 pm

So I guess I fall into the "older boglehead" category but I think that any marriage that begins with a lawyer designing an escape plan is destined to fail. By having 2 lawyers designing it a couple is clearly getting the expectation of what a "her" team and "his" team will look like. Negotiations will be done through lawyers. I would rather save the money and focus on raising my commitment to each other.
"Earn All You Can; Give All You Can; Save All You Can." .... John Wesley

oldfatguy
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Re: Prenuptial agreement for moderately successful 30 year olds

Post by oldfatguy » Wed Oct 16, 2019 1:55 pm

Silence Dogood wrote:
Wed Oct 16, 2019 1:39 pm
WingsFan4Life wrote:
Wed Oct 16, 2019 1:14 pm
Give it time :twisted:
oldfatguy wrote:
Wed Oct 16, 2019 1:14 pm
That's likely because many of them are more recently married and won't get divorced for another 5-10 years. :P
deltaneutral83 wrote:
Wed Oct 16, 2019 1:15 pm
... the oldest millennial isn't even 40 so how would such a poll be conducted practically
I would encourage you to look at the statistics.

The divorce rate for millennials is lower and it has nothing to do with the fact that millennials are still young.
There are multiple contributing factors (e.g., they are marrying later, they are more educated, etc.), but one of them is most certainly that many millennial divorces have not yet occurred.
Last edited by oldfatguy on Wed Oct 16, 2019 1:56 pm, edited 1 time in total.

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sunny_socal
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Re: Prenuptial agreement for moderately successful 30 year olds

Post by sunny_socal » Wed Oct 16, 2019 1:56 pm

Why even bother getting married? You've been behaving like a married couple, is that not enough? (Note: I'm a strong advocate for marriage but in my mind planning a divorce doesn't square with the commitment you're supposedly making)

If you decide to get married anyway, don't get a prenup. It weakens your will because you've just left yourself a back door.

oldfatguy
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Re: Prenuptial agreement for moderately successful 30 year olds

Post by oldfatguy » Wed Oct 16, 2019 1:58 pm

sunny_socal wrote:
Wed Oct 16, 2019 1:56 pm
Why even bother getting married? You've been behaving like a married couple, is that not enough? (Note: I'm a strong advocate for marriage but in my mind planning a divorce doesn't square with the commitment you're supposedly making)

If you decide to get married anyway, don't get a prenup. It weakens your will because you've just left yourself a back door.
There's already an established legal process for ending a marriage. A prenup simply allows a couple of customize certain conditions.

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Re: Prenuptial agreement for moderately successful 30 year olds

Post by HornedToad » Wed Oct 16, 2019 2:05 pm

AnonLady wrote:
Wed Oct 16, 2019 1:44 pm
knightrider wrote:
Wed Oct 16, 2019 11:53 am
OriolesFan89 wrote:
Wed Oct 16, 2019 11:01 am
Hers - $175k in assets. No debt. $105k salary.
His - $825k plus about $100k of equity in our $325k house that I've lived in for 7 years. No debt aside from mortgage. $120k salary.
I am no expert, but doesn't sound like a prenup is needed for this situation. Since you both earn similar amounts, then there is nothing really to split between you. My understanding is any assets you have before marriage will remain yours.
Assets from before the marriage are yours to keep, but the GROWTH of those assets are split, either 50/50 or "equitably", depending on your state.

I have been bitten by this rule twice and I don't recommend letting it bite you if you can avoid it. But I would also recommend some sort of pre-marriage counseling too, even moreso than a prenup. Divorce sucks even without all the financial issues, better to make sure the marriage starts out on the best footing and with good communication and agreement on all major issues that often lead to divorce (to avoid a divorce, fingers crossed) than a lock tight prenup after a divorce.

Best of luck in your nuptials!
This answer is the clear choice. Your $500k is already yours as long as you don't commingle it (depending on state). How worried are you about protecting the growth of the assets? Additionally, will the pre-nup and no alimony make it harder in the discussion about not continuing to work after having a child?

Silence Dogood
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Re: Prenuptial agreement for moderately successful 30 year olds

Post by Silence Dogood » Wed Oct 16, 2019 2:08 pm

OP,

How does your future spouse feel about this issue?

Ybsybs
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Re: Prenuptial agreement for moderately successful 30 year olds

Post by Ybsybs » Wed Oct 16, 2019 2:16 pm

I suggest you talk about what seems fair and then each get lawyers to put it in legalese.

Perhaps:
-Each keeps amounts they had before entering the marriage.
-Each keeps any inheritances or gifts from the respective sides of the family.
-Each retains ownerships of gifts given to them by the other. (If he gives her jewelry, it stays with her in a split. If she give him a Rolex, it stays with him in a split.)
-Each split 50/50 any gains.
-Both agree to make the other whole if life circumstances during marriage result in one spouse's 401k getting $15k per year added to it annually while the other spouse only has an IRA with $5k added to it per year.
Last edited by Ybsybs on Wed Oct 16, 2019 2:16 pm, edited 1 time in total.

Silence Dogood
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Re: Prenuptial agreement for moderately successful 30 year olds

Post by Silence Dogood » Wed Oct 16, 2019 2:16 pm

OP,

For what it's worth, I got married a few years ago and did not get a prenup.

Your future spouse sounds very responsible. From what you've written, she hasn't had as many breaks in life as you, but has still managed to pay off her student loan debt and save up a large amount of money.

You've been together for 10 years. I don't think you have anything to worry about (think: opportunity cost)!

Congratulations!

:beer

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Re: Prenuptial agreement for moderately successful 30 year olds

Post by deltaneutral83 » Wed Oct 16, 2019 2:21 pm

samsdad wrote:
Wed Oct 16, 2019 1:41 pm

Methinks you should worry more about your judgment than your money quite frankly. If you don’t trust this person with your very life, perhaps it’s time to find someone else. Finding the right person in the world for you would be a better idea than finding the right prenup. This should be easy: there’s never been more “fish in the sea” in history. Or lawyers. :twisted:

Source: am lawyer, married to lawyer, no prenup.
I think it's obvious that it's possible to be involved with people that one can trust with their lives at a point in time and then things change for reasons out of one's control. I think it's also fair to say these unfortunate situations can arise with people whom one never shared a bed, so the latter could require even more scrutiny. Or are you saying to just blindly risk it ("It" being the OP's situation of having an $825k net worth and his future spouse $175k and splitting everything evenly in the unlikely event years down the road) as that is likely to have a better result?

Your last line doesn't really mention amount of assets at marriage as two broke 2L's wouldn't really be an issue prenup wise. Now if you were older or Johnny Cochran in his late 50's, then yea, that would be a conversation as far as assets, prenup, etc etc. I guess my question is why would the OP be concerned with the viewpoints that do not have experience with his specific issue? If a couple got married broke, and now have 2 comma net worth 30 years later with a strong marriage, then that's great, but it is not the situation the OP is in.

Broken Man 1999
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Re: Prenuptial agreement for moderately successful 30 year olds

Post by Broken Man 1999 » Wed Oct 16, 2019 2:32 pm

I get it, but still...

When DW and I got married near 48 years ago, I had $3,000. She had nothing.

We both started with minimum wages jobs, and prospered. Her career was interrupted by our choice of having her be SAHM. She was out of the job market for about ten years. Meantime my career was flourishing. By the time she returned to the work force, she only advanced to about a third of my salary. Before children, our earnings were not as skewed as they became during the 10 years she was at home.

Add in $$$ I received via settlement, inheritance, and insurance, her assets are currently 20% of our net worth.

From the start my extra $$$ received as outlined above were co-mingled.

If and only if we had started out with extreme differences of wealth would a pre-nup even been considered, and even then I probably wouldn't have considered it.

Her sacrifices made it much easier for me to do a lot of traveling for MegaCorp, which advanced my salary. And my ability to be a road warrior advanced our family's standard of living, not to mention our ability to stash the large sums of tax-deferred $$$$, which added greatly to our retirement portfolio.

So, at the present time I see everything we have been able to accomplish valued at 50/50.

So even if one of the partners earn much less, there is value in the type support offered the higher earning partner. Without her being at home with our children for a decade, my career most likely would not have been as successful.

One needs to define value beyond a dollar amount when it comes to such efforts.

Somehow, despite our foolish foray into marriage at 18 years of age, we have managed to avoid divorce. Still a possibilty, I suppose.

So, OP, if you do proceed with a pre-nup, just remember that there are many things that are difficult to value. Earnings are just a part.

Broken Man 1999
“If I cannot drink Bourbon and smoke cigars in Heaven than I shall not go. " -Mark Twain

Luckywon
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Re: Prenuptial agreement for moderately successful 30 year olds

Post by Luckywon » Wed Oct 16, 2019 2:56 pm

OP, do not be put off by people opining here that there is something wrong with the notion that you are contemplating a prenuptial agreement, and even that your marriage is thereby doomed to failure. It seems that some here feel that defending their notions of institution of marriage gives license to be judgmental and mean spirited. In my opinion, a prenuptial agreement can be of great value and does not in any way detract from the institution of marriage and certainly not for the two of you since you seem to be in agreement that you would like one, and for stated very good reasons.

I recommend you read the book "Prenuptial al Agreements: Writing a Fair and Lasting Contract, Fourth Edition" by Katherine Stoner. It will outline what is possible with such an agreement, help you decide whether one is indeed appropriate for you, and how to efficiently draft a contract, with your attorneys, that the two of you are happy with.

I saw at least one reply above questioning why you should even get married if you are contemplating a prenuptial agreement. Notwithstanding the fact that such comments are really off-topic given that you were not asking for an opinion on whether or not to get one, I'll offer an answer: Marriage confers benefits that cohabitation or even domestic partnership cannot. Social Security survivor benefits, spousal inheritance of IRA, property tax benefits from spousal inheritance of property in some states, and many others. So certainly, get married soon, and proceed with your diligence in looking into whether a prenuptial agreement is right for you. Best wishes!!

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Re: Prenuptial agreement for moderately successful 30 year olds

Post by Bully3000 » Wed Oct 16, 2019 4:03 pm

As someone who was married for 12 years and is currently in the third year of paying Alimony and lost a significant amount of my net worth and peak earnings in what was then a fast growing company/industry which has set me back YEARS I would strongly recommend a prenup, as someone else said earlier on your post you can agree to the unknown government one which varies depending on the year and the place you live or you can make your own agreement.

Even if what is your before the marriage remains it is still your burden to prove it and fight for it which gets expensive, same with Alimony and splitting other assets, lawyers are not cheap.

I am engaged and closer to 40 but already discussed with my Fiances,

No Alimony
House and contributions towards remains solely with me( I pay 100% and have a couple 100k equity).
All retirement assets and contributions remain separate property.
Whoever wants to fight the prenup pays the legal expenses involved.

There are only so many times you can afford to start over and once was enough for me.

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Re: Prenuptial agreement for moderately successful 30 year olds

Post by mrspock » Wed Oct 16, 2019 4:21 pm

knightrider wrote:
Wed Oct 16, 2019 11:53 am
OriolesFan89 wrote:
Wed Oct 16, 2019 11:01 am
Hers - $175k in assets. No debt. $105k salary.
His - $825k plus about $100k of equity in our $325k house that I've lived in for 7 years. No debt aside from mortgage. $120k salary.
I am no expert, but doesn't sound like a prenup is needed for this situation. Since you both earn similar amounts, then there is nothing really to split between you. My understanding is any assets you have before marriage will remain yours.
Oh, oh let me help! What happens when:

1. You divorce and one of you quit working ? Is spousal support due? How much? For how long?

2. Capital gains on house and investments held prior? Are they yours? Split down the middle?

3. Kids — If you split, are you paying for their college? How much? For how long ? Private school?

4. Inheritance — how will this all work?

.... I could go on, and lawyers will have a far longer list. It’s not just about income, it’s about expectations.

JBTX
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Re: Prenuptial agreement for moderately successful 30 year olds

Post by JBTX » Wed Oct 16, 2019 4:31 pm

Decades ago it was something that crossed my mind, and we even discussed, but ultimately found it unnecessary in our case. I don't agree with those who seem to think it is predicting marital failure. The odds of dying in younger or middle ages is far less than divorce, but nobody thinks life insurance is fatalistic.

I'm not a lawyer. My take with your income, and your assets, you should be OK. AFAIK what you bring into the marriage is generally considered yours. Beyond that, all appreciation and income is fair game.

If kids were involved I could see much more of a need for one.

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Tamarind
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Re: Prenuptial agreement for moderately successful 30 year olds

Post by Tamarind » Wed Oct 16, 2019 4:40 pm

You sound a lot like my wife and I:
* Early 30s
* Been together many years already
* Have shared home and expenses, if not accounts
* Both frugal and savers
* One has somewhat more assets

I also came here to ask about a prenup (free free to read my old thread). The forum talked me out of it and I'm glad they did.

This tidbit was the decider for me:
If one of you decides to go "nuclear" in a divorce, a prenup will not save you. You can spend plenty of money just as easily challenging or defending the the prenup as you can on a divorce without one.

Go ahead and have the conversations you'd want to have to draft a prenup. Talk about what fair means to each of you. Draw up financial disclosures for each other that establish your pre-marital financial situations. (We got ours notarized.) Think hard about your level of trust in each other, your ability to argue without getting too furious. Promise each other that in the event of a divorce you'll get mediation, keep your pre-marital property, split all the marital property down the middle (or however you both think is fair), and spend as little time with lawyers as possible even if you have each other's guts.

Then skip the prenup.

Prenups do make sense for the following:
*Non-egalitarian couples with drastically different financial situations (ie one will stop working and give up marketable skills in return for a commitment to be provided for by the other).
*People getting married for the second time who already have children.
*People who will likely inherit very large sums, family businesses, etc
*People who own large, illiquid assets (ie businesses and land)
*People who have some other reason that the normal "fair" distribution rules of divorce are not right for them.

ETA: age
Last edited by Tamarind on Wed Oct 16, 2019 4:50 pm, edited 1 time in total.

TheDDC
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Re: Prenuptial agreement for moderately successful 30 year olds

Post by TheDDC » Wed Oct 16, 2019 4:43 pm

Prenups are stupid in this case, and in most cases where children from prior marriages aren’t involved. If you don’t want to get married then don’t get married and move on. Sounds like there are other issues at play. Either make an honest woman out of her or move on.

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Re: Prenuptial agreement for moderately successful 30 year olds

Post by junior » Wed Oct 16, 2019 4:44 pm

mrspock wrote:
Wed Oct 16, 2019 4:21 pm
knightrider wrote:
Wed Oct 16, 2019 11:53 am
OriolesFan89 wrote:
Wed Oct 16, 2019 11:01 am
Hers - $175k in assets. No debt. $105k salary.
His - $825k plus about $100k of equity in our $325k house that I've lived in for 7 years. No debt aside from mortgage. $120k salary.
I am no expert, but doesn't sound like a prenup is needed for this situation. Since you both earn similar amounts, then there is nothing really to split between you. My understanding is any assets you have before marriage will remain yours.
Oh, oh let me help! What happens when:

1. You divorce and one of you quit working ? Is spousal support due? How much? For how long?

2. Capital gains on house and investments held prior? Are they yours? Split down the middle?

3. Kids — If you split, are you paying for their college? How much? For how long ? Private school?

4. Inheritance — how will this all work?

.... I could go on, and lawyers will have a far longer list. It’s not just about income, it’s about expectations.
I don't even think that a prenup can legally cover child support or whether college will be paid for, your kids won't be parties to it and the child has rights you can't sign away.

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Tamarind
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Re: Prenuptial agreement for moderately successful 30 year olds

Post by Tamarind » Wed Oct 16, 2019 4:48 pm

sd323232 wrote:
Wed Oct 16, 2019 12:30 pm
Many older bogleheads dont understand that times have changed. Marriages dont last. I'm also in my 30s as OP.

OP, this is great way to protect your capital. Many people start prenup shaming us just because they had 50-60-70 year marriages. They dont understand how happy they are having such a long marriages and expect us to be like them. They never had to go through horrible experience like divorce. Talk to lawyer and follow through on your prenup. Wish you luck in your marriage my friend!
33 here and I quite firmly disagree. College educated people our age actually have lower divorce rates than our parents at this point, in large part due to marrying later.

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Re: Prenuptial agreement for moderately successful 30 year olds

Post by EnjoyIt » Wed Oct 16, 2019 4:50 pm

Too many self righteous people on this thread and because of them as usual threads about prenups get locked. If you are against prenups then please don’t post on this thread. Post somewhere that you agree on the topic instead of causing trouble here.

To OP,
I think getting a prenup is a good idea. What I would do in your shoes is keep the $500K you have accumulated separate from your joint account. Since the both of you make similar money, may have kids, etc I would therefor co-mingle assets. I would have a prenup that dictates that $500k and any growth in that account is yours. Everything else will be divided 50/50. I also recommend you agree to arbitration if a divorce ever happens so as to avoid costly litigation.

Locked