Memo – High Earning Women – You Need A Prenup Before Marrying

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I often call a prenuptial agreement a “Marriage Dissolution Framework.” 

Let’s hear that again a “Marriage Dissolution Framework.” That is truly what a prenuptial agreement should provide. 

Many peoples’ initial reaction to a prenup is negative. This is usually not based on facts and reality, but how we have been socialized.

Trust me, I have been consulting to couples considering marriage since 1987. Many of those couples have one party who is moderately or significantly higher earning than the other. Today, more and more women are that higher earning party.

If that is you, then please keep reading.

For decades high earning men have been advised to get a prenuptial agreement before marrying. I personally endorse this for everyone getting married, men and women.

This advice is especially for women getting married after they have established their career or business, and have accumulated pre-marital assets and substantial future earning power.

Today, there are more women becoming high earners, but I have found that they bring up a prenuptial agreement when meeting with me less than 5% of the time compared to their male counterparts. It seems that women are, on average, more romantic and idealistic about marriage than men.

I would be remiss if I didn’t educate my clients of the possible benefits of a prenup, so I always try to. 

So, don’t we all plan for negative eventualities in all areas of our lives? 

Don’t we have health insurance, car insurance and homeowner’s insurance?

Don’t we make disaster recovery plans at work and test them? Of course we do.

One of the chapters in my book, Be The Chocolate Milk, is Test, Test and Re-Test. It explains my philosophy on this.

Getting married is the most significant financial contract you will ever sign in your life. Give it the respect and attention it deserves. 

It deserves more disaster recovery planning than any other business or personal matter. 

You, and your future husband, want to make agreements about all areas of your individual and marital financial lives prior to signing the marriage contract (license) in case you want to terminate your relationship.

Disaster recovery planning means starting at the worst case scenario. 

Let’s play that out.

You are a 30 year old woman, earning $100,000 more than your fiancé. You have accumulated $750k in net assets prior to getting married. Ten years pass and during that time you and your husband decide that he should work part time, or not at all, and be a full time homemaker and raise your children. You have 3 children, now 8, 6 & 4 after ten years pass.

Ladies, allowing your husband to focus only on the home and to reduce or eliminate earning full time income is an incredible risk for your children’s future as we will see. You need to be practical and realistic about the eventuality your husband will want to divorce you. If so, keeping him full time in the workforce AND keeping your time at work flexible, is the most prudent way to plan for the worst. If you plan correctly, you may at least get close to 50/50 physical custody upon divorce, and your alimony and child support can be minimized. If you don’t plan, you will not get these benefits and your children will suffer.

In my example, the high earning wife did not plan unfortunately.

Your husband, who has been a full time homemaker for tens years, files for divorce against you and demands alimony and child support, both of which he will get. He immediately wants you removed from the marital home you have paid for, and only offers the following times for you to spend with your children. Every other weekend, and dinner on Wednesdays from 6 – 8:30pm.

You are left with the prospect of losing any meaningful relationship with your children. You will watch as your ex-husband, and his new girlfriend, become their sole influence during their most important teen-age years.

And you are going to have to finance all of this well through your last child finishing college, which in this case is approximately 20 years. 

This is happening more and more to women. Their motherhood and money are being taken away from them by the courts due to their poor planning. 

You have been the breadwinner and you will be forced to maintain your earning power for the benefit of your children and ex-husband. You will not be able to reduce your working hours to see your children more as that would mean less earnings and you are not allowed to earn less for decades to come. You are still only seen as the family’s bank, and your husband the primary physical caregiver and parent to your joint children. 

So, women, especially higher earning women, need to plan for this possible disaster in the future. Look up the statistics about how often first marriages fail. Once you have done that research, it will be very sobering.

Back to the Marriage Dissolution Framework Agreement or prenuptial agreement.

Ladies, by now you should be asking yourself “Wait, why would I voluntarily sign a personal relationship contract or license, which gives governmental and judicial control over dissolving that relationship? And also exposes my parental rights, accumulated assets and my future income to judicial confiscation and redistribution?”

Good questions. Glad you are asking them. 

Yes, for commercial transactions we sign contracts. But let me ask you a question, how many of your current deep and close personal relationships have you signed a binding contract or license for?

You must have at least one more? For example, you have one with your best girlfriend right? So, before you can stop being best friends with her you have to spend tens of thousands on attorneys, and then go to court and get a judge to give you permission to not be best friends any longer. 

And that judge can take one half your assets and future income and give them to this person who is no longer going to be your best friend.

Every month after your best friend’s license is negated by the judge, you have to pay your former best girlfriend money against your will. 

Now, doesn’t that sound ridiculous? Of course it does because it is. You would never sign any contract / license forcing you to maintain a personal relationship until a judge gives you permission to leave it. Or a contract / license that could lead to you losing control over your entire financial life for decades after that personal relationship no longer has any value to you.

The best prenuptial agreement is not having nuptials, especially for high earning women. 

The most important issue lies with your children in this situation. 

If you only have one paragraph in a prenuptial agreement, it should stipulate that you have the right to live full time with your minor children and that your children’s father will never attempt to have you removed from their home.  

You living with your children full time is the most important part of them having a stable upbringing. Children being raised without both parents living full time in their home have so many disadvantages there are too many to list. Always fight to live with your minor children full time for as long as you can.

Can you imagine the emotional, psychological and long term developmental harm children must endure when they only see their mother every other weekend?

Please plan for this eventuality before marrying and having children. 

Marriages are failing at 50% or greater rate.

Now, for high earning men listening to this, of course the same advice applies to you. Simply start from the beginning and reverse the pronouns and all the gendered words.