It is smart to keep certain aspects of your personal finances hidden from your spouse?
Not revealing everything about your personal finances can cause significant issues in a marriage. It comes down to trust and I have often found that when someone finds that the other will not disclose his or her finances, it can lead to further secrecy and suspicions. Also when one spouse is in the financial dark, it can cause unhealthy dependency issues in the marriage.
When entering into a prenuptial agreement there needs to be full financial disclosure between the parties. While this is done for legal reasons, I think it also serves a psychological purpose.
How will a person’s portfolio & financial growth likely change when they become married?
The transition from being a single person to a married person is an adjustment in many ways. When people are accustomed to keeping their own bank accounts and managing their finances, it is often difficult to now play with someone else in the sandbox. One of things that upsets clients most is he or she thinks they have established a rainy day fund in a sock drawer and then finds out that the monies they scrounged to save is still subject to division.
What can you do if you and your spouse don’t see eye-to-eyes on spending and budging your money?
Getting on the same page with your new spouse in terms of your relationship with money is imperative to a healthy relationship. Some people are savers and some are spenders. So many of my clients complain about the his or her ex-to-be’s spending habits.
The problem occurs when you have one person who spent excessively during the marriage and therefore established a lifestyle that a Court will look at to maintain post-divorce. My clients will say “But I told her/him not to spend like that. What was I supposed to do? My choice was either not pay the card and ruin my credit or get divorced then!”. If your spouse and you do not establish ground rules of spending during the marriage, do not expect them to be established in divorce.
Do you recommend that all couples have a pre-nuptial agreement?
A prenuptial agreement is the best thing that someone can do to protect the active management of pre-marital property. If that is not an option, then I often suggest that you allow an independent money-manager to invest the account and do not get involved. I know it is hard to relinquish control, but it may be harder to transfer to your bitter ex-spouse half of the appreciation.
Jacqueline Newman is a Family Law Attorney & Managing Partner at Berkman Bottger Newman & Rodd in NYC. Ms. Newman’s practice consists of litigation, collaborative law and mediation. Jacqueline specializes in complex high net worth matrimonial cases and negotiating prenuptial agreements. She has appeared as a commentator on various television shows and has been quoted as an expert in numerous publications, including Glamour Magazine, Crain’s New York Business, U.S. News and World Report, Woman’s Day and The Huffington Post.