Money, Money, Money, Money.....by Barbara Kapetanakes, PsyD. on 10/24/14
What a busy week! I spent several days in San Diego at the Academy of Professional Family Mediators conference, learning more about working with divorcing families. I'm comfortable with the negotiation aspect, and as a psychologist, I think there are qualities and skills I bring to the table that other professionals may not, but I'm still learning things like how to split assets, understand tax laws, how to read a 1040, etc. My head was so full when I got back on that plane to come home!
One presentation I went to was about writing up pre-nuptual agreements for couples getting ready to marry. While I think a pre-nup is a great idea that puts a lot of things out on the table, what I didn't know was that couples who sit down and talk about money prior to getting married are more likely to STAY married. This certainly makes a lot of sense. Talking about money is very difficult for most of us. It's a sensitive topic like sex or personal hygiene that we'd rather ignore than address and confront head on. So couples who take that leap to talk about finances are probably more likely to talk about other hard things, rather than let them fester until bigger problems form.
Talking about your financial expectations, attitudes about money, savings, spending, etc, and having an open dialogue about how much privacy and transparency you each expect when it comes to money is important in a relationship. Some couples keep most of their money separate, feeling they don't want to "answer to" their partner for every expense. Some have one joint account from which they pay household bills, but maintain some money of their own that they can use at their discretion. Some couples only consult with each other on purchases above a certain amount, for example $250, while they can spend less than that without worry that it will interfere with bill-paying or cause the other spouse to feel out of the loop on big purchases.
Pre-nuptual agreements can be set up to keep pre-marital money and property separate, or to protect children and/or stepchildren, inheritance, or money that family members may have contributed for the purchase of a house, for example. While many couples eventually co-mingle a lot of their assets and debt over time, a pre-nup can set guidelines for specific allocations such as college or determine who has power of attorney or healthcare proxy. This is especially important in second marriages where there may be children from a previous marriage, and the current partnership would like to provide for each other while also providing for their children in the form of inheritance. A pre-nup can spell out what accounts are earmarked for whom, allowing for all family members to get a fair piece of the pie.
Regardless of the reasons, open communication is important in a relationship, and money is only one of the difficult topics to be addressed. The chances of having a longer, happier marriage is increased by good communication between the partners, so while many might see a pre-nup as "not romantic," I see it very differently. It's a way for two people to sit down and address what they expect from their long-term relationship, to discuss concerns about finances, and to figure out ways to provide for each other and other family members who may be in need. Never a bad thing.