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Let me just say I love the way you respectfully qualified whose opinions you were interested in here
Agreed! I legit only came here to check if anyone disrespected that, and I’m pleasantly shocked no one came in all “holier than thou” on it.
I mean for me it doesn’t really matter what my net worth vs theirs is, it’s just about protecting yourself, especially on big ticket items, such as retirement (do you really want them taking 50% of everything you worked so hard to save?!) or your home (if you have one pre-marriage). I’m watching my brother go through a divorce right now (10 years married) and he would give anything for the protection of a prenup right now. So to me, it’s really like an insurance policy—everyone needs one no matter how much you make. My 2 cents.
AD1- I think that is what pre nups are for! Maybe not that exact scenario ofc, but you can bet my prenup will have language around how to split things if there is a SAHP or if there is a really expensive medical issue
Rising Star
Generally only in the case of large family wealth. If you are factoring in student loans come on
Raising 5 kids is expensive labor
I am a fan of prenups regardless of net worth. Offered to have one drafted but my husband didn’t think it was necessary (he has a significantly higher net worth and has the potential to inherent quite a bit of money/real estate from family).
When we discussed the prenup, it wasn’t just specific to net worth but also potential children. Both of us are products of a divorce. His mother CLEANED his father out and used her kids as pawns to continue draining him up until the last one finished grad school 4 years ago (divorced 20 years ago). My mother also played similar games, but with a father who was not as well off. We both have bad tastes in our mouths because of it and that was what I wanted to prevent - protect any potential children from our emotions if we separate. And reduce the costs of mediators/lawyers along the way.
Thinking of it from a financial perspective, when my husbands parents were married in their early 20s, neither had anything. By the time they divorced, his mother was a stay at home mom (her choice) and father was worth millions. His mother had an affair, his mother requested the divorce, and she still walked away with more than half of everything his father had earned. His net worth would be triple what it is now if he’d protected himself.
He got a prenup with the second wife, and I believe there was a clause that allowed them to update or expire it after 15 years. He chose to the expire. Consider something like that if you pursue a prenup.
To add: a friend was in law school meeting with a mentor who suggested divorce law. Because it’s in the lawyers best interest to drag things out. That is burned into brain and a talking point i brought up with my now husband. Weird to talk about the end before you begin, but when you’ve lived through a divorce, it’s always at the forefront of your mind.
I don’t think it is probably worth it in any of the example you give. I would think there would need to be at least a couple hundred thousand difference. If you are both recent grads with decent jobs, the 75k difference is nothing after a couple years. Just my 2 cents.
Thanks for your perspective. You have a good point.
Prenups are not just about money. They generally also make divorce easier - agreement on division of wealth, but also child custody, pet custody, etc
You are correct. This discussion is focusing on the financial portion of the prenup.
I think a prenup is worth it with $0 in difference between your net worths. I think it is useful to have a discussion before anyone is angry, or whatever in how assets would be split if a divorce happens. Even if you have the exact same amount of money now - what happens if one of you gets a high flying job while he becomes a house husband/wife. Would you split 50/50 - does the non-paid spouse take less?
If I had to pick numbers, I would say a negative net worth compared to 500k+ warrants a prenup.
However, I think prenups make more sense when we’re talking about the things you excluded. I signed a prenup only related to my husbands current trust/future inheritance at my own suggestion.
We are getting a post nup and it has nothing to do with our net worth but has more to do about peace of mind, setting financial guidelines, etc. My current worth is probably about 10-15x the one of my wife’s but ultimately she will inherit shares to a family business that would surpass my current net worth by a long shot.
We never really saw it about the financial guidance piece, but more as a baseline for the both of us to build a strong future with a control in place so if that, god forbid, we ever wish to separate we could do so cleanly and keep our finances separate. That being said, what sparked the conversation was both of our families. In terms of us, we have a joint account for our joint savings and expenses and we have had it since before we even got engaged, so thats where we manage “communal” assets. My wife is also very risk adverse, so she is not super into investments, whereas I like my stocks, real estate and others to keep me going. Thats another piece that we could collectively agree that our post-nup was useful for.
Of course :) this is something im really passionate about because my mom is exactly like your wife and it took me and my dad years of convincing her to finally convert her money from a money market to invested last year. She would have soooo much more money now otherwise but she doesn’t see it!
Also if you’re a business owner or your significant other is a business owner. Say the business goes under, accumulates debt, etc. it would stop collectors from coming after your personal assets.
It doesn’t stop creditors from pursuing the assets though. It’s a pursuit that can be rebutted at time and expense to the business owner.
Prenups are not just for financial inequality going into marriage. That is what most people think of though. Prenups are simply contracts like any other contract. You can plan for lots of things: kids, money, salary earned during marriage, future salary. Etc. Hugely beneficial if you can take the emotion out of the topic.
Should look into your state laws, but generally inheritance and gifts aren’t viewed as community property.
Rising Star
Have always thought about it more for anticipated family wealth/inheritance issues OR marriage later in life where the delta between your assets is like 200K+
Your examples seem too low to warrant on existing assets alone, but it also depends on the fabric of each person’s life, the relationship, goals alignment, career mobility, family planning... it’s not just a current-state numbers decision
I like the idea of the peace of mind they bring. I don’t want either of us to feel we have to stay for fear of a messy divorce. I want us to stay because we want to. A prenup helps everyone know they can leave without getting absolutely destroyed in a long expensive divorce which means they’re less likely to stay for the wrong reason.
Obvi it not that cut and dry and prenups doesn’t guarantee a clean split but it’s maybe one less thing to have to worry about.
Also - better to negotiate now when no one is upset.
Enthusiast
I think a prenup makes sense whenever you go into a marriage with wealth accumulated before the marriage. Seems like a no brainer that that wealth should be considered individual. Also, having a clear agreement on custody, division of wealth accumulated during the marriage, etc. provides transparency and shows that the couple can compromise/ trust each other.
Outside of financials: Think lawsuits. If your spouse gets sued the suer isn’t entitled to go after your separately owned assets, only “community” assets. Prenups aren’t awful if both parties set fair understandable terms.
Net worth is beside the point. Everyone should have a prenup.
It’s sad when you actually have to think about this stuff. That’s why I am glad I got
Married and we both have good careers. We get rich together and love each other throughout the journey.
No, A2 - you are sad for thinking that making a plan is a bad thing when you are in a partnership. Marriage is meant to be forever, yet you never know what might happen throughout the course of life that might cause you to want to divorce. A prenup is meant to protect both parties in the case of the unexpected and unanticipated. Just because someone has a good career when you get married does not mean that will continue — ask anyone in the US who was riffed during the recession. I’m certain that impacted quite a few marriages with dual “good careers” like yours.
Rising Star
If it’s money that’s invested and I want the growth to continue to be mine I would definitely consider it at lower levels
A2 that definitely depends on the state. A lot of states will throw earnings from investments into the marital estate. That’s why this decision could depend on the state.
From a financial perspective, I don’t think the relative net worth difference is as important as differences in assets or debt. If one has significantly more debt or significantly more assets, it can be important to agree to the approach to split things later. A combined financial plan combines all those things, and actual accounts things go to may be less important. Husband’s savings account may be used while wife’s brokerage account is the riskier investments in the total plan. The husband may have owned a house with a mortgage auto paid out of his paycheck while the wife previously rented, which doesn’t mean the husband shouldn’t be entitled to investment earnings in the name of the wife during the marriage.