@HImom, I agree with your aunt. That’s exactly how I’d play it.
Wow, we need to redo our wills!
We did set up a trust for the estate but never got beyond talking about when the children would have access to the trust. Never thought about what would happen to the funds afterwards regarding children’s spouses etc. Yes, we do want it to stay with the children (and their children) and not pass into their marital estate.
I brought significant earning potential to the marriage, but also massive student load debts, now long retired. I don’t expect either kids to end up in jobs where they make a lot of money but do want to protect their inheritance (assuming they get one).
Right. And that doesn’t mean they think their children are of “bad character” or would try to screw the others. I really dislike the bad character assumption.
If you have no interest in raising a family because you already did, why remarry? I probably won’t if H (who is significantly older) leaves me a widow. It just creates unneeded complications and angst. I would be sure to consider including longtime partners and leave them some legacy, where appropriate, but not to so much as to be a huge detriment of my kids and future grandkids.
For young people just starting out who have no other commitments to others, I think it should be a huge red flag if one person says, going in,“There’s a huge economic disparity in our circumstances, and I would like to maintain that disparity in our marriage. So please sign this so that it is clear that this is not going to be an equal partnership.” Uh, no thanks.
I don’t think either of my parents would remarry if something happened to the other. The only reason they married each other was because they figured it would be easier due to me (mom was pregnant with me). With kids not being a concern now, I can’t see another marriage ever in the cards. We’re not a family big on legal marriages lol.
But if they did I would encourage a prenup of some sort. Both of my parents are too nice for their own good and I don’t really want even the possibility of tangling with a step spouse. We don’t have much in cash or anything but there are several family heirlooms from my grandparents’ homeland that I can’t fathom losing.
It’s not unusual for young (30’s) couples in NYC to have prenups. They are getting married later and some have significant assets before marriage that they want to protect or a SO has high student loan debts. Usually it’s what’s yours before marriage is yours and what we made after marriage is ours.
If one person has say $300K in assets and the potential partner has $200k in debt due to ed loans, that would definitely be something to consider and discuss before getting married, IMHO, even if it is a 1st marriage for them and neither has dependents. Just saying, there can be huge differences in financial situations for young people even in their 20s. I am not saying it would mean a prenup, but I could see why one or the other of the pair may consider it.
Here’s an interesting article, pro and con on the topic.
http://www.aaml.org/sites/default/files/The%20Wall%20Street%20Journal%20(3-2-15).pdf
I agree that if the only issues are the assets/debts acquired prior to marriage and potential inheritances, I think that is all that should be in any agreement prior to the marriage.
I can see my son using his inherited money to purchase a house. I don’t know if it is legal to have the house titled in a way that reflects if he puts in 80%, or if future wife can sign a promisary note that house held as joint tenants, with his initial money returned upon sale of house( if sold cuz of a divorce).
I believe this is state related.
I believe most young people are adverse to a pre-nup, but I’ve been burned. I have many patients who gave their kids money to buy a house. They didn’t make the kids sign a legal document that this $ was a loan. Had they done that, they would have said $ to help out their child once divorced.
^ See this is the kind of thing I’m talking about. FIL gave us money or our first down payment. No legal document. When we got a little extra, we paid him back. Because thatf’s just what you do. Now, he could have refused it, but we certainly didn’t think he should. But either way, no contracts were necessary.
Pizzagirl-- I get you don’t see it the same way. But if we aren’t talking about sketchy character, what exactly are we “protecting” ourselves or our kids from? Because that word keeps coming up on this thread.
I think the point is that pre-nups “protect” against the default rules that exist under the law. If the couple is happy with the default rules, there is no need for a pre-nup. If the parties want to change the financial terms of their marriage from what the default rules impose, they should have a pre-nup.
It is troubling to parents who help THEIR kid get a house after the marriage, which ends in divorce and the equity in the house is divided, even tho it all came from one spouse’s family, especially when it is a relatively short marriage and the amount of money is 6 figures (or significant).
It’s not necessarily that there is ill-will from the split but the fact is it does cost more to have two households than one and the parents of the divorcing person want their child to have whatever cushion the gift previously given may afford.
I don’t think this makes anyone “bad” or “sketchy,” it is just financial realities of dividing assets when happily ever after ends early.
“-- I get you don’t see it the same way. But if we aren’t talking about sketchy character, what exactly are we “protecting” ourselves or our kids from? Because that word keeps coming up on this thread.”
My father’s will divides equally between me and my sister. Our will divides equally between our two kids. There is no planet on which my sister and I would ever battle or try to screw the other over, and I cannot imagine my two, who love each other dearly, doing anything of that nature. But this still protects everybody, to have it spelled out legally. From what? From life.
I am sitting here with my retired father. He just received a threatening Facebook message from a cousin who has asked to borrow $50,000 for his ailing sister (to which my dad said no). These people wouldn’t know my dad if they tripped over him. They haven’t had any contact with him in years. They just see him as a source of moneybags. I had to stop writing this post to show him how to block this guy on Facebook. When you have assets, you are vulnerable.
PG! I vote with block these relatives.
Would anybody here who has two kids draft a will giving all to one and saying “just split it with the other”? Even if you trusted that kid implicitly to do the right thing and split it 50-50?
Better things get haggled out in a prenup than in a bad situation under duress.
Again I agree this doesn’t describe most young couples. It certainly didn’t apply to us starting out. But for those with significant assets or part ownership of a family business, this may make sense.
A trust is a good way for the parents of the bride and groom to impose their wishes on money they are passing on, without making the bride or groom be the one to impose the restrictions. Of course, there are ways around most things. I’m talking about you, FIL - you know, don’t you, that BIL’s wife is going to get that money and spend it on her kids, because your son will let her. But if the trust makes you feel better, who am I to judge? But I will let other BIL know to decant the trust as quickly as possible, because it’s not fair that any money left at his death would go to his siblings not his wife.
Adult siblings generally don’t share a household and child rearing and other intimacies of marriage, including the good times and bad times. Also, we don’t get to choose our sibs but most DO choose any spouse they marry. I get what you are saying but don’t see sibs in quite the same way as a spouse.
It also depends on how frequent divorces are in your environment and generally how long marriages last. If you’ve not seen many marriages last 10+ years, it’s very different than if mostly the folks you know have been married forever.
In my extended family (including my 1st cousins), divorces are VERY rare and marriages tend to last many decades.
Good topic- I just had lunch with a good friend and we talked about pre nups. She didn’t have one. She was married for a lot of years to a guy we all thought was wonderful. During the separation he was great, she assumed the divorce would be fair. He wasn’t. She came into her marriage with assets and with a healthy bank balance. The lifetime earning potential probably equal but she had a steady income from investments made by her grandparents. Those assets remained hers but they used her large bank account and her disbursement payments to buy a home. The home was community property. Over the years they moved to larger homes as the family size grew and school district became a factor. When they divorced and sold the home he got half, even though her family money had played a huge part in the purchase and upkeep. She of course also got half of the huge debts he had run up on credit cards.
On the other hand we have another friend who purchased her home with family money and did major remodeling with gifted money. She was a very anal organized person and had kept the card and checks made out to just her. She was able to get that back in her settlement.
My kids will inherit some assets and H and I have talked about how can we protect those assets down the road.
I don’t think having a prenuptial agreement is unreasonable. Though I have been told you can protect those assets if funds if you are careful.