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Given my financial situation, should I explore the idea of a prenup with my partner before we marry?

I'm 35 years old and getting married next year. My partner and I earn roughly the same income and have roughly the same net worth, but I still feel the need to explore a prenup. To me it feels like insurance. Should people in our situation explore a prenup? And if so, how do you discuss it without upsetting your partner?

Financial Planning, Real Estate, Insurance
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January 2019

Yes, it is more than appropriate that you consider a prenup. And your analogy to insurance is excellent. I often point out to people that, although they have no plans to burn their house down, they do have homeowner's insurance.

Hopefully, you and your partner are able to have open and frank discussions about money, you fully understand each other's money attitudes and habits, and you are planning how you will handle money during the marriage and how financial decisions will be made. If, for any reason, you cannot have these discussions, then that is a red flag. If you are going to any kind of pre-marital counseling, these discussions, as well as considerations for a prenup may be discussed in that context. "Here is what we have, here is what we will do with it...." Who owns the house you will live in? How is it titled? Will it be retitled? Maybe not. How do one of you preserve your investment to date? A prenup would address all asset ownership issues, both current and future. Promote "Yours, Mine, and Ours" in a positive context but with clear definition. "I have this and would like to keep it as mine. I will contribute this much to a new home, furnishings, vacations, etc. Can we just write this all down, then put it away and not need to rehash it all again?" Or, "I really do not want to repeatedly debate about money. Can we just decide some things, write it down, then move on?"  

If you hear something like, "What's the matter, don't you trust me?" run the other way. I realize there is much more to your relationship than this, but I have a specialty in the finances of divorce and that one phrase was usually the initial battle cry that signaled trouble.

If your partner simply will not participate in this discussion, then you can still protect yourself. Consult with an estate planning attorney who also does family law and place your assets in a trust, preferably an "Asset Protection Trust." There are states that have particularly strong asset protection trusts, and may be able to serve out-of-state needs, that were designed to protect against claims by spouses in divorce, as well as creditors. As an alternative, there are strategies to how you manage your finances that can help protect them from claims in divorce, but this is not a do-it-yourself project. Most people read a little something online and think they are benefiting themselves but end up doing more harm than if they had done nothing at all. Call me if you need further help.

February 2019
February 2019