Comments on: Divorce – A Wealth Killer

By: Ms Save Money

Ms Save Money — Tue, 05 May 2009 20:38:05 +0000

Gosh, divorce is such messy business. I knew someone who married 3 times and has 9 kids – he makes a lot of money but none of that goes to him…. so sad…

By: wannabe_millionnaire

wannabe_millionnaire — Mon, 10 Nov 2008 18:42:39 +0000

If you read Elizabeth Warren’s “Two income trap,” divorce is listed as top three causes of personal bankruptcy. The other two are layoff and medical bills.

By: Kandace

Kandace — Tue, 14 Oct 2008 23:21:20 +0000

Divorce is also a financial killer for second marriages. My husband and I were both previously married, but I had no kids. He has five. It’s a wealth killer because the financial implications continue long after the papers are signed. Half of his current income goes for alimony, child support, and insurance. His wife isn’t able to give any additional financial support to the kids so we are also taking on the costs of college, weddings, etc. I would love to be saving more for retirment, but am grateful that we can meet our obligations and keep our heads above water.

By: Alice

Alice — Sun, 12 Oct 2008 02:57:21 +0000

When my husband and I were about to separate, nearly a year ago, he told me what a “better deal” he could get with someone else, and “how much better off” he’d be without me, because I had been a stay at home mom for the past 2 years–we had two children, ages just 4 years and 6 months at the time of the separation. Ironically, the divorce is now nearly finalized, and his legal bills alone were more than $30,000, he got to keep the house–a dubious distinction, with the market being what it is–and I will be getting, aside from the settlement, which was significant to me, enough to allow me to purchase a home in my own name–25% of his pre-tax income for the next 14 years. And 15% for four years after that. He’ll basically be paying my mortgage, paying the taxes on the income, and I’ll be deducting the interest. For someone who was in an abusive relationship, I have actually greatly improved my emotional and financial outlook; I have basically no debt (just a small amount of student loans and legal fees from the divorce) and I’m now in a career-track government job, a homeowner, and building a life of financial independence. I miss being home with my girls, but from a numbers standpoint, I am in a much better place.

By: Stephen

Stephen — Wed, 08 Oct 2008 12:35:13 +0000

The Sentinel:

In the real world people use their emotions to lead them to divorce instead of using their logic to do what is right and save the marriage and honour their commitments. Emotions are more the reason why we have a 50% divorce rate than logic. Use your logic before and after you get married and then you won’t need the logic of a prenup for your divorce because it will never happen.

Do you consider yourself to be a lyer? If not, then don’t get up and lie to your future partner and tell them you will be with them for the rest of your life.

By: mjw2005

mjw2005 — Tue, 07 Oct 2008 21:10:48 +0000

I guess what I meant to say is the fact that we need pre-nups in our society says a lot about who we all are…maybe in noblelea’s situation I could see it as reasonable as there are innocent parties involved, but even then if I was the husband or husband to be I would be a little hurt if I was asked to sign a pre-nup because to me it says…”I don’t trust you….I wan’t to marry you but I don’t trust you 100%”…..

I know people don’t agree with me

By: nobleea

nobleea — Tue, 07 Oct 2008 15:24:04 +0000

My fiance (then girlfriend) and I read David Bach’s book Smart Couples Finish Rich. There is a chapter on wills and pre nups. After reading the whole book, we had a discussion on pre nups (the book explains them well and why you should have them). They’re mainly required when there is a large discrepancy in wealth being brought in to the marriage.

We haven’t written one up yet.

I agree that divorces have become too easy, or too acceptable. I don’t mean that in a bad way, but marriages are not cake walks and there will always be struggles. Aside from abuse, every marriage is save-able.

I highly recommend the book Five Love Languages if you disagree.

By: Sarlock

Sarlock — Tue, 07 Oct 2008 06:50:07 +0000

Given the financial devestation that can result from divorce and the significant odds that it will occur to any given couple, it is prudent to invest a huge amount of time in to maintaining and nurturing your marriage… more than you do your own investments even. A failed investment decision or two can hurt, but a divorce hurts far more. Sometimes people forget that a marriage requires time and effort just like other things do.
I know far more married couples who are on their way to a well funded retirement than I know divorced individuals who are in that boat.

By: The Financial Blogger

The Financial Blogger — Tue, 07 Oct 2008 02:16:49 +0000

If divorce is the inevitable path:
- Quit your job
- Start your own company as self employed
- Declare 12k a year while making 100K
- Ask for a pension to drive your sport car ;-)

If you have children, divorce is not an option, it’s suicide ;-) hahaha!

By: Thicken My Wallet

Thicken My Wallet — Tue, 07 Oct 2008 01:17:45 +0000

Pre-nups can be, and are, challenged if the circumstances in which the pre-nup were signed have changed materially so do not think that a pre-nup is iron-clad.

By: The Sentinel

The Sentinel — Tue, 07 Oct 2008 01:06:32 +0000

mjw2005,

So essentially you’re saying that you’re willing to flip a coin (50% chance of divorce) on the chance of going broke. I’m sorry, but this is the real world and in the real world, logic trumps emotion every time.

By: Accelerated Mortgage Program

Accelerated Mortgage Program — Mon, 06 Oct 2008 23:40:50 +0000

it makes sense… i still cant believe how costly it can be. i would imagine the more assets you are dealing with, the more complex the situation, and that will lead to increased costs to straighten things out.
-jack

By: Roxanne

Roxanne — Mon, 06 Oct 2008 21:30:25 +0000

Another interesting point is to look at the province you get married in. In Qc for example – there are two types of possible outcomes in divorce: 50/50 or you keep what you had going in – everything aquired after is 50/50. It depends what you decided on with the notary. Here is the legal mumbo jumbo:
http://www.cdnq.org/en/legalInformations/depliants/MatrimonialRegimes.html
So be aware of the choices your province holds.

By: Brian

Brian — Mon, 06 Oct 2008 17:53:51 +0000

The real solution is not get to the decision of divorce. The whole nation should see “Fireproof” in theaters now. There is not one marriage that is not savable. It takes two people coming together and working threw it. Marriage is not easy and requires work by two people. If you are not willing to make it work do not say the vows that you will love each other threw all situations till death you part. In the today’s culture couples give up too easy and it gets a little tough, then they do not work it out and it just escalates to each of them hating each other.

By: FrugalTrader

FrugalTrader — Mon, 06 Oct 2008 16:56:21 +0000

The whole “emotion” behind pre-nups is an interesting issue. If one spouse brings significantly more assets than the other spouse, I can’t imagine NOT signing one before marriage. A prime example is Paul McCartney and Heather Mills. I’ll bet Mr. McCartney wished he has his time back!

By: Marianne O.

Marianne O. — Mon, 06 Oct 2008 16:12:41 +0000

I think there are some situations in which a pre-nup can be very useful. My husband and I have a pre-nup. Its sole function is to exclude him from having a financial interest in my parents’ cottage, the ownership of which they transferred to me and my brother about 15 years ago.

Since my parents live full-time at the cottage for at least 8 months of the year, it’s really more their home than “home.” So they want reassurance that they’re not going to lose the cottage. Fortunately my husband was willing to sign, and that gives them a lot of peace of mind.

As for our other possessions, we’re pre-nup free. Right now we’ve got far more debt than equity, so there’s not much to protect.

By: EastCoast

EastCoast — Mon, 06 Oct 2008 15:44:36 +0000

I think the subject of Pre-nups are easier with the younger generations. For myself in my mid 20s and having seen my parents go through a nasty long and expensive divorce I see a pre-nup as a way to minimize the cost of a divorce and speed up the process if it comes to that. For the girlfriends I have talked to that come from divorced house holds as well they can see the benefit to it.

By: Hank

Hank — Mon, 06 Oct 2008 15:32:09 +0000

I saw a neat response of the division of assets in divorce on a similar thread.
Husband 50%, Wife 50%, Lawyer 40%
Divorce is a wealth killer unless you’re a “Family Law’ Lawyer. ;-)

By: mjw2005

mjw2005 — Mon, 06 Oct 2008 15:12:58 +0000

Pre-nups…in the real world….I can not imagine anyone agreeing to them….and if I was single and was asked to sign one before I was married I would be insulted….maybe this is illogical….but we live in a real world with real emotions….If I was considering marriage I would be damn sure it was the person I would want to spend the rest of my life with….or at least take a chance at…and if I loose my shirt in the process so be it….All I can say is what type of people consider write and sign these things….

just my 2 cents

By: Dividend Growth Investor

Dividend Growth Investor — Mon, 06 Oct 2008 14:27:23 +0000

I have had similar experiences like David on talks about pre-nups. Few people discuss it or are willing to do it. It’s a touchy subject.. If they don’t want to sign is that because you hurt their feelings by telling them that you have an expectation that you’ll eventually get divorced down the road..
Or is this a game that your gf’s are playing so that they get the maximum benefit?

Oh my head hurts :-)