What financial questions should couples ask each other before embarking on their life together?
Is a prenuptial agreement the foundation to a financially-solid marriage or a buzzkill in the first throes of engagement bliss? These are the primary advantages and disadvantages to prenups, according to Affluent investors surveyed by Millionaire Corner.
While individuals typically sign a prenuptial agreement when they have significant financial assets, own real estate, or face family demands such as financing a college education, a prenuptial agreement is not for wealthy couples only. A prenup can help individuals propetec their property, head off future litigation and determine liability for debt.
Generally speaking, a majority of Affluent investors (57 percent) would recommend altar-bound couples to sign a prenuptial agreement. Who are the biggest proponents? Income, age, marital status and financial knowledge are major factors in who is most likely to recommend this course of action.
Not surprisingly, high net worth investors with at least $5 million of net worth are the most likely to recommend couples sign a prenuptial agreement. More than two-thirds (67 percent) would offer this advice. Even a majority of those with less than $100,000 (60 percent) would encourage engaged couples to sign a prenuptial agreement.
Single individuals are much more likely than married people to recommend a prenup (72 percent vs. 52 percent), our survey found, while those who have the most confidence in their financial knowledge, too, are bigger proponents of prenuptial agreements than those who say they have just some knowledge about financial matters (55 percent). But even those who say they have little or no knowledge feel in the know about prenups. Fifty-eight percent would recommend an engaged couple sign one.
Prenuptial agreements should not be left to the last minute, experts say. Writing for the American Bar Association, attorney-mediator Diana Mercer, advises individuals to make an exhaustive list of assets in debt currently in an individual’s name. “It’s required for your prenuptial agreement,” she writes, “and it’s also good practice about being up-front and straightforward about financial issues with your new marital partner.”
Mercer posits these other financial issues for engaged couples to consider:
· Who will make the financial decisions and handle the checkbook?
· Do you and your fiancé have similar money styles or personalities?
· Have you discussed your long-term financial goals and how each will contribute?
· How will you handle the income and assets you accumulate together? Will they be joint and 50/50?
· Have you see each other’s credit reports?
· What is your expectation about the kinds of jobs and income each of you will have?
· Do you anticipate both of you continuing to work after having children? Would one of you stay at home?
Such questions are vital to any couple embarking on a life together, and the ongoing discussion about financial issues is viewed by Affluent investors surveyed by Millionaire Corner as one of the primary advantages of signing a prenuptial agreement.
Donald Liebenson writes news and features for Millionaire Corner. He has been published in the Chicago Tribune, The Chicago Sun-Times, The Los Angeles Times, Fiscal Times, Entertainment Weekly, Huffington Post, and other outlets. He has also served as a marketing writer for Chicago-based Questar Entertainment and distributor Baker & Taylor.
A graduate of the University of Southern California, he is married with a college-age son. He also writes extensively about entertainment.