I have been in my current relationship for almost three years. I’m a young woman, 41, have a great, stable career and make about $100,000 a year. I am ambitious and my prospects have me increasing my income by $10,000 every year. I have about $140,000 in savings, and no debt. I am close to closing on a home, which will be completely financed by me.
My girlfriend, 38, works a few gig-type jobs that she loves and makes $50,000 a year. She has very little in savings and about $20,000 in student loans, and isn’t in the position to buy or help with a down payment, closing costs, etc. She lives paycheck to paycheck, pretty much, and as she loves what she does, isn’t motivated to do anything else to make more.
We don’t live together, but we have started the marriage discussion and plan on moving in together when I close. My family isn’t thrilled about the relationship for a few reasons. My girlfriend doesn’t have a stable career. She has no ambition, and makes significantly less than I do.
“‘My girlfriend, 38, works a few gig-type jobs that she loves and makes $50,000 a year. She has very little in savings.’”
She understands and has said she is happy to sign a prenup. I will also add that my brother is going through a nasty divorce, so the whole family is on edge. We all live in Louisiana — a community-property law state — and his cheating and gambling estranged wife is taking him to the cleaners.
Given all this, I need help figuring out what’s fair for the prenup and for our living situation. For the prenup, I was thinking that we include no spousal support or alimony, no sharing of retirement accounts or contributions made during the marriage, and everyone’s debt incurred during the marriage is their own.
The new house and mortgage will be in my name alone. Whatever she contributes to the mortgage will be reimbursed if I ever sell the house — but not if we get a divorce. Also, she will be reimbursed for contributions toward capital improvements.
“‘We will create a household budget to include combined expenses, mortgage, utilities, groceries and dining out together.’”
As far as living arrangements, we will create a household budget to include combined expenses such as mortgage, utilities, groceries, dining out together, etc. Until we get married, we will split things down the middle. After marriage, we will open joint savings and checking accounts.
We each contribute the same percentage to our checking account to cover the household budget, so I would pay more since I make more. Then we contribute the same amount each month to a joint savings account to build a joint emergency fund.
I cannot plan for every eventuality, and these are very un-sexy premarital conversations. Is there anything else I am not thinking about? Does this seem fair to me and my partner?
Planning Wedding & Prenup
I can answer your penultimate question. The final question is for your partner.
Marriage is many things, but as you suggest, it is a business contract in addition to a commitment to spend the rest of your lives together — or, at the very least, a show of willingness to do that.
Before I get into the nitty-gritty of your prenuptial agreement, the overarching feeling from your letter is of one person who holds all the cards, and another person who doesn’t get much of a look in. Indeed, you mention that your family doesn’t support the relationship, and your fiancée is vaguely — and likely unfairly — compared to your ne’er-do-well former sister-in-law.
I don’t get a clear sense from your letter that you respect and/or support your partner’s choices. If you have misgivings about her unwillingness to switch to a higher-paying career track — instead of the one that makes her happy — the differences in your respective outlooks will only get worse as time goes on, especially as the economic imbalance in your relationship grows.
Dividing your finances forensically will only go so far. Your letter focused on the finance, but I guess I was hoping to read one nice thing about your fiancée. And I’m sure she has many fine qualities.
“‘I don’t get a clear sense from your letter that you respect and/or support your partner’s choices.’”
— The Moneyist
There are no hard-and-fast rules when it comes to prenuptial agreements. It really depends on what each party believes is fair. Your fiancée is signed up, but if you are reimbursing her for her contributions to your mortgage if you sell the house, it would make sense (for her) if you would apply this principle to a possible divorce. Otherwise, she will be punished if you split, but the outcome is the same for you. I would suggest that any percentage your fiancée contributes to the mortgage is based on your salaries. If you pay $1,000, she pays $500.
There is no mention of spousal support or duration of any spousal support in the event that you split. That further amplifies the “what’s yours is yours and what’s mine is mine” theme of your prenup plans, and doesn’t take into account the difference in your incomes. What happens if you lose your job or if you are sick for a prolonged period of time? Does your partner pick up the slack on your mortgage? Do the quite onerous terms of your prenup come back to bite you? The art of a prenup is to balance compassionate and supportive issues with financial ones.
As you set up a joint account, you should ensure that the money from that account is not used to make significant renovations to your house or that you use joint funds to pay the mortgage. That would likely commingle the property and turn it from separate to marital/community property.
Finally, “ambition” is a tricky word, and “no ambition” are trickier words. You are equating salary with ambition, and your partner makes pretty close to the average salary in Louisiana. Ambition could also mean making a living doing something you love.
This prenup protects you. I’m not sure it does exactly that for your fiancée.
Check out the Moneyist private Facebook group, where we look for answers to life’s thorniest money issues. Readers write in to me with all sorts of dilemmas. Post your questions, tell me what you want to know more about, or weigh in on the latest Moneyist columns.
The Moneyist regrets he cannot reply to questions individually.
By emailing your questions, you agree to having them published anonymously on MarketWatch. By submitting your story to Dow Jones & Company, the publisher of MarketWatch, you understand and agree that we may use your story, or versions of it, in all media and platforms, including via third parties.
‘My aim is to have a net worth of at least $100,000’: I’m 29 and live with my mom in a rented mobile home. I have a $25K emergency fund and $26K in a Roth IRA. What do I do next?
‘He has a greedy daughter’: I want to leave my home to my daughter, but I would also like to continue receiving income from my husband’s properties if I die before him
‘They don’t have the best marriage’: My stepfather bought a house 20 years ago before marrying my mother. She paid for a new roof and kitchen, but her name is not on the deed