Millennials – they’re always finding things to disrupt. Cereal. Broadcast television. American cheese. Marriage.
Or maybe it has something to do with the growing number of millenials getting prenups. Sixty-two percent of attorneys in a recent survey noted an increase in the total number of their clients getting prenups.
Why the jump in numbers?
It used to be that prenuptials were the stuff of Hollywood legends and robber barron tycoons. Take Elizabeth Taylor for example.
Elizabeth Taylor, she of the violet eyes and white diamonds, was married a grand total of eight times between 1956 and 2008. (Though twice to her great love, Richard Burton). Despite her iconic status as a one of the great beauties of the 20th century and as a homewrecker, she’s also infamous for the prenuptial agreement agreement between her and her last husband, Larry Fortensky. A lifelong construction worker at the time of their marriage in 1991, Fortensky was entitled to $1 million after their marriage was 5 years old.
How long did the marriage last? Five years exactly.
But while Taylor got burned on her prenuptial agreement, the truth is that prenuptial agreements typically occurred among the rich and famous. Average couples married and if things fell apart, they hashed things out as best they could.
The landscape for prenups is looking quite different these days. Celebrities are still crafting detailed prenups to protect their wealth – and sometimes more. Beyoncé’s prenup to Jay Z includes a provision that she be paid $5 million for each child she has. Justin Timberlake has to pay Jessica Biel $500,000 immediately if he ever cheats on her.
But while it’s likely that no non-celebrity would have a prenup with those conditions, millennials are increasingly adopting this more pragmatic approach to marriage planning.
This pragmatism is informed by personal histories as well as current circumstances. Millennials grew up during the heart of the divorce boom in the 1980s and 1990s; one third of them grew up in a divorced household. As a result, there is a decreased generational level of romanticizing marriage.
“There is an understanding of marriage as a legal status,” says Leanna Johannes, senior wealth strategist at PNC Wealth Management. “Marriage is a legal act with legal consequences should the marriage end in divorce. Millennials have a better understanding of those consequences, and are taking the appropriate steps to create a mutually beneficial prenuptial agreement.”
Another concern factors in a major way for millennials: debt. Millennials, on average, carry an average of $34,770 in student loan debt, in addition to credit card, auto loan, and mortgage debt. Because millennials are getting married later, they have the opportunity to lead independent financial lives before committing to their spouse. This can be good – the opportunity to have greater earning power benefits women significantly – but it also increases the concern about entangling financial lives.
Prenuptial agreements don’t need to be a cause for concern about the well-being of a relationship. Instead, they can be an opportunity to discuss your goals and priorities in your relationship before getting married – something that a relationship expert would suggest you do anyhow!
When should you consider a prenup? A prenup can be valuable for any married-couple-to-be, but especially in the following scenarios:
Discussing a prenuptial agreement isn’t a one time conversation, but by starting early and speaking honestly about your needs, you can find common ground with your partner about this important topic.
If you have impending nuptials, congratulations! Shann Chaudry, LLC offers experienced guidance through creating a prenuptial agreement that honors both your and your partner’s financial and personal needs. Contact us for a free consultation.
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