I was a teenager when I first heard the term “prenuptial agreement.” I asked my cousin what it meant, and she told me it was something a rich man asks a woman to sign to prevent her from marrying him just for his money. I was so intrigued by this concept that whenever I read about an older, wealthy man whose second (or third) wife fell into the “trophy-wife” category, I wondered if she had signed a prenup.
Today, I am one of those second wives — although I am not young enough to be mistaken for my husband’s trophy wife, as we’re less than six years apart. And it was I — not he — who first brought up the idea of a prenup. Apparently, that’s not so rare anymore. A member survey by the American Academy of Matrimonial Lawyers found 46 percent of divorce attorneys had observed an increase in women initiating requests for these agreements.
Of course, as many who aren’t in favor of these documents will quickly point out — discussing a prenup can put a damper on the romance and excitement of two people madly in love. My response? This is actually the ideal time to negotiate a prenup because each party can think in terms of fairness (as opposed to in the midst of a divorce).
Dan and I started dating in 2004, a few months after he and his wife separated. After his divorce, we bought a house together and each contributed half of the down payment. We decided we would keep separate checking accounts for everything of a personal nature, such as clothes and visits to the salon for me, and ski trips and single malt scotch for him. We would open a joint account for the mortgage, utilities, car insurance, groceries and dining out.
Since Dan’s daughter lived with us half time, he threw a little extra into the joint account each month, and I contributed a little each year to a 529 college savings plan I had set up for her. (Since I have no children of my own, I felt it was important to help fund my future stepdaughter’s college education.) After two and a half years of living together like a family, I asked Dan to consider taking the formal step of marriage.
From a financial standpoint, our relationship was working fine. We had very few conflicts about money because we decided in advance how we would address the division of financial responsibilities. But then I panicked. Would Dan have the right to half of my brokerage and retirement accounts if we married and then divorced?
I was well aware that he was still bitter his ex-wife had received half of his assets in their divorce. But more importantly, for many years I had been living below my means and shouldering investment risk to build up a $1 million portfolio. The thought of him having the right to half that should our marriage not survive made me sick to my stomach. But I was still nervous about having this discussion and being a buzzkill.
Dan had always encouraged me to be open with him about my feelings, so one night at dinner I asked him if he would consider signing a prenup. Yes, I just blurted it out (as I do with most subjects). Fortunately, he seemed relieved that I had broached the subject and had a few supporting arguments of his own. Because we didn’t intend to have a child together, there was no need for one of us to sacrifice our career to care for a baby, and he pointed out that since we both had successful careers and he anticipated starting his own company in the future, a prenup made a lot of sense. Although at that point our incomes were comparable, what if he built a company that generated millions of dollars of revenue, which enabled us to live a more pampered life? Should we divorce, would he be obligated to write me a check every month for thousands of dollars of spousal support?
I agreed not only with Dan’s points, but his feelings behind them. Surprisingly, the conversation wasn’t uncomfortable; in fact, it actually brought us closer together. If you can discuss the emotionally charged issue of money in a loving and respectful manner with your partner, then you can probably discuss almost anything.
We had a lawyer draw up the prenup and our wills at the same time. And in the end, we spent a few thousand dollars upfront, as a form of insurance, to avoid paying potentially astronomical lawyers’ fees in the future. We have been married nearly six years now, and that prenup is buried among all the other papers we never look at. Do we regret our decision? Not in the least.
I’ve heard from plenty of women that prenups aren’t for them — they have no assets right now, just lots of student debt. But I’d still encourage them to consider it. You went to college or graduate school for a reason, probably so you can earn a decent income in the future. Ten, 20 or 30 years from now you just might have income and assets you no longer want to share with that man you married.
Does signing a prenup mean you are banking on a divorce? Of course not. No one walks down the aisle dreaming of divorce, but you know the stats. No one buys a new car anticipating an accident either.
Laurie Itkin is Founder of The Options Lady and a Financial Advisor with Coastwise Capital Group. Her passion is educating and empowering women of all ages to take control of their money, become successful investors and grow the money they work so hard to earn. She is the author of “Every Woman Should Know Her Options: Invest Your Way to Financial Empowerment.”