If there is good record keeping of separate assets, yes, those can remain separate. If the records aren’t meticulous, especially if it’s a long marriage, the result will probably be the assets will be considered marital assets.
It will likely be some years before our kids have these issues. I trust they will work out solutions that will work for them and their partners.
I don’t get why you would do that, but okay for the sake of argument, yes, the result would be the same. But why be weird to your kids like that? (Says she, who doesn’t have a will because by default, it goes to my spouse and then my kids, anyway.)
Wow, I just read mom60’s post. So, much of our assets come from inheritances from my H. So I guess he should worry that I’d expect to have half the worth now, even if we divorced?
Yes, yes I definitely would expect half. It’s our assets; we are married. If we split, we split those assets evenly. They are “ours.” And I just posed that question to him, and he looked confused…like why wouldn’t I expect half…these are OUR assets, our home. Of course it would split evenly.
But that’ explicit non-compartmentalizing and trust are part of why I don’t think we’ll divorce. 
I’ve asked my parents to be extremely explicit in their wills. My sister is someone who will try to take everything including stuff she doesn’t want just so she can say she has them and I don’t.
But you don’t choose your kids… unlike your spouse
H just recently received a hefty inheritance (roughly equal to all the assets we each amassed together to date). He just threw it all into our joint accounts and we put some of it to maximally fund his retirement accounts. We have been married nearly 30 years–not sure how it might be if we were newlyweds. Probably the same. We used our joint funds to pay the negative cash flow in his real estate investments that we sold to buy our home.
We think of ourselves as a single economic unit and have since we were married. It makes things less complicated for us. Neither of us amasses or hides bills.
We are a single economic unit, too, and always have been, but that’s simply not the point. Other people come to marriage with different situations. I don’t have to be in them to appreciate them.
Here’s nolo.com’s blurb on prenups. Half of the Qs in the quiz would be a “yes” for S, so he will have to think about this when the situation arises.
http://www.nolo.com/legal-encyclopedia/prenuptial-agreement-right-you-29652.html
I can’t believe people don’t understand a prenup when one partner brings a family-owned business to the table.
Here’s a wiki, for folks interested in learning more about prenups.
You see an experienced estate lawyer and ask him to set up trusts so that the TRUST owns the assets. You give the kids the opportunity to receive disbursements at intervals or however you want. But you can protect the TRUST assets from a divorce. However, as stated, if the child chooses to co-mingle the withdrawals, they are indeed community property. And that’s not necessarily a bad thing. Many couples, like DH and I, consider themselves to be one unit financially, a team if you will. DH inherited 40K from his grandmother. He used it as a down payment on our first home. Our home then became community property. He understands that it is OUR house, even though I didn’t contribute any of the down payment. Couples who do not co-mingle or who do not share our philosophy might handle it differently. For example, the DH buys the house with his inheritance and does not put the wife on the deed; however they want to handle it. Lawyers’ advice on this kind of stuff is invaluable. The point is that the money in the trust is not his until he receives a disbursement, and it’s not hers unless he consciously chooses to share it with her. The remaining money in the trust belongs to the trust.
Our trusts are set up so that Ds can make withdrawals at intervals, with the cooperation of a well chosen trustee. Ds’ husbands cannot. The Ds may well desire to co-mingle their withdrawals. There’s nothing we could or necessarily would do to prevent that. However, the balance that remains in the trust is protected.
If you have significant assets, this is the way to go. For sure. And as said before, it also protects the Ds from spousal resentment, because they had no say in how this was set up. And they have no power to change it.
Just one warning for those who want to keep the money in the family.
When I was growing up, there was a family with 5 “daughters.” Unless you knew the family well, you didn’t know some of the Ds were in fact nieces.
The dad had a brother who was better off than he was. The brother purchased a large life insurance policy benefiting his wife and children. He also had a house and other assets.Brother and his wife died suddenly in a famous fire. Money, including life insurance, went to his Ds. There may also have been a settlement relating to the fire.
Ds went to live with aunt and uncle who had the same last name. Aunt and uncle raised them from a very young age. They were warm and loving and the Ds referred to them as mom and dad. The youngest had no memory at all of her parents.
Aunt and uncle did not spend a penny of the money left for the girls. They didn’t because the way the deceased brother and wife’s will read, money could only go to the girls. Since the aunt and uncle had less money, they were unwilling to spend money on their nieces they couldn’t afford to spend on their own Ds. All 5 of the Ds grew up basically blue collar…despite the fact that the deceased had left well over $1 million to their Ds over 50 years ago.
When they turned 21, the nieces came into what was a LOT of money. It did cause some friction with their “sisters.”
Personally…I think it would have been much better if the aunt and uncle had left the money in such a way that the people who took on the duty of raising their Ds–who truly treated them as their own—could have spent the money on all the girls growing up.
So…think not just of divorce but also of death. I have a married kid. As far as I know, a very happily married kid. I have a very young grandchild. If I died first, and then my married kid died at a young age, I would expect my kid-in-law to remarry. I think it’s possible, if not probable, that my kid in law would have more children. In that situation, believe it or not, I would want any money I had left to my married kid to go not just to my granchild, but to my kid in law’s other children as well. Otherwise, I suspect my kid in law wouldn’ t spend any of the money my grandchild had inherited from my child on my grandchild during the years my kid was growing up. Whether or not I like the idea, reality is that my grandchild would be raised by a stepparent. I would want the stepparent to treat my grandchild with as much love as stepparent’s own children.
In any event…my own experience with the 5 “sisters,” who didn’t have “extras” like music or dance lessons growing up because their “parents” couldn’t afford them, has colored my attitude.
In the case of my friend the money brought into the marriage was close to a million dollars. The marriage lasted 13 yrs before separation. Divorce was not till about 5 yrs later. After paying off all his debts she came out with very little money.
Nrdsb4- we set up a trust when the kids were young. Updating it is on our todo list. We don’t have a problem with co-mingled disbursements. My H comingles his with me. We want to protect what my FIL has built for future generations.
^^^^I think that’s really wise.
When you have young children, your will is likely structured differently than when you kids are grown. That’s the great thing about wills and trusts. Most of them can be changed over time.
I appreciate the differences too. I am just ambivalent about prenups, as I have no personal experiences with them or maintaining separate finances. My friends do that I. Their marriage and it seems to work for them, mainly so they don’t fight about him bailing out his family who are always expecting handouts.
I have a friend who is raising her kids AND her suddenly orphaned nephew. I’m not sure whether the nephew inherited anything from his folks but the family is raising them all the same and yes, it would be nice if anything left to him could be used for his support since he was a preteen or younger when orphaned.
It is so tough to know what the future holds. Money can really help ease things.
@jonri, trusts can be structured to reflect your wishes. We got a good education about how specific you can actually make these. I never would have thought about how to address “future adopted children” of my spouse in the event of my death if our lawyer hadn’t asked us. These things can be very very specific.
We have a family member who raised his own 3 kids and the 3 kids of his sister-in-law/brother-in-law who died in a plane crash. I don’t know how anything was structured, but I believe there was a settlement from the air carrier. That would be the kind of thing where you’d want some lawyers involved to cross all the t’s and dot the i’s
I wish this stuff weren’t so complicated, but sometimes it is.
To the point of “character,” it’s also useful to have a non-relative (with no vested interest) that you could trust to execute things, get money where it needed to be, etc. In our case, my sister was the guardian of our children when they were minors, but H’s best friend (who is also a lawyer and CFP) would have administered the money. It was a good separation of duties.
Yes, if my nephew needs a home, I am designated as his guardian but his assets will be controlled by one of his uncles. It can be good or bad, depending on the working and other relationship. I suspect he will safely remain in his parents care another 6 years until he reaches 18 and becomes an adult and they can redraft their estate docs.
All this talk about diving assets among kids reminds me of prior threads where the issue about how to divide assets among kids was raised–give it equally to all or give more to the “needier.”
These are all important topics but I think it is hijacking the issue of prenups.
Maybe prenups should come with sunset dates, so they expire after a certain duration of the marriage? That’s certainly an option as well or different terms after varying durations of wedded bliss.
There are so many individual situations involved in passing on assets that it makes sense to do some estate planning. H and I created a trust for our kids and his kids–had advice from an estate lawyer who is also the trustee for the family trust. Requests from any kid go to him and he makes decisions in keeping with the terms of the trust. It was a fairly long process to set this up but IMO it was worthwhile. We redid our wills at the same time we set up the trust. H and I have never had separate accounts–we both started out with very little. Dont feel a need to change it after 35+ years.