Premarital Planning
At Pointer Creek Wealth Management we’re comfortable talking about money because we’ve facilitated money discussions amongst couples almost every single day for the past two decades. We know from experience these discussions usually bring a little anxiety before ultimately bringing calm and peace. Our promise to you is that Pointer Creek is a safe space to talk about money and all issues relating to it. Premarital financial planning is one issue we passionately believe falls into the old adage that an ounce of prevention is worth pounds of cure. Thousands of pounds, actually!
Before the big day, we always recommend a Benchmark Financial Independence Plan and a prenuptial agreement. Neither tool is about setting your marriage up to fail. Quite the contrary, it’s about keeping you and your partner on the same page financially, and showing your partner you want the best for them in the chance feelings ever change in the future. The terms of any prenuptial agreement are best decided from a place of caring and discussing mutual concerns, rather than from a place of animosity, should you ever find yourselves in conflict or disagreement later.
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You may have notions of prenuptials being only for old rich guys making sure wife number three doesn’t get any of his millions if things don’t work out. Those are NOT the agreements we are fostering here, and we don’t condone anyone entering a marriage built on trying to hide assets from their partner. We do support open dialogue and understanding. Moreso, we understand that certain assets or inheritances may have been intended or explicitly earmarked for specific purposes; perhaps elderly parents, siblings, or children from another relationship. State laws, circumstance, and chance are often not as understanding as you can be now in pre-marital agreements.
I’m sure you know someone, or have heard of someone, who was accidentally disinherited from a parent’s remarriage. Family trusts and wills can prevent this scenario, but typically come later in life. A prenuptial agreement and documented premarital financial plan can serve as an “emergency exit plan” until common estate planning documents are created later in your marriage. That said, we still recommend at a minimum having simple wills in place, along with a springing power of attorney and advanced medical directives. Guidance in preparing these minimum recommended documents is included in the cost of our premarital planning services.
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What you should expect from this exercise is mutual understanding, a strategy to work collaboratively towards your joint and individual goals, and a discovery of love and respect that comes out of this approach.
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Some questions addressed in our Premarital Planning Package... ​
Does each partner understand that marriage is a legal contract and understand the implications of that contract?
Have you discussed any joint goals to this point?
Will you have joint retirement goals or separate goals?
What does money mean to each partner?
Does either partner use a budget now?
Will there be a joint budget?
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Will you have joint retirement goals or separate goals?
What does money mean to each partner?
Does either partner use a budget now?
Will there be a joint budget?
How do you plan on making cash flow and spending decisions moving forward?
Who will be responsible for the day-to-day financial operations?
Will this task be divided, or one spouse primarily responsible? If divided, how will it be divided?
Does each partner have a stable income?
Does either partner have career goals different than their current situation?
Do you plan to maintain separate or joint checking accounts or both?
How have you each been providing benefits and who will provide benefits moving forward?
How will each of you make these decisions regarding benefits?
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Some longer term financial questions to consider...
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Do you plan on having children? If so... what changes to budget or employment will be needed? Also, what level of support do you want to provide for them later in life? For example, college funding?
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Will your retirement ages be the same, or will one spouse work longer than the other?
Do you share thoughts on charitable contributions or leaving a legacy to any cause or organization?
Will either partner work in a family owned business, and if so what implications does that bring?
How will you equalize or provide security for a spouse that might not have retirement plans, due to a decision to stay home and support their partner’s career or children?
Will either partner be caring for or supporting aging parents? How will that be funded? Will that impact joint goals and/or cash flow?
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Truths to consider...
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Prenuptials can be romantic. They can demonstrate how each partner will be cared for in the event the marriage does not last, bringing certainty and understanding to both partners. They can remove heat-of-the-moment reactions and years or decades of animosity. Marriage is a legally binding contract with implications to each partner’s assets, income, taxes, properties, business, employee benefits, etcetera.
Marriage is state specific. Separation, divorce, and dissolution are real and statistically significant. To completely ignore their possibility or probability can be highly detrimental to both partners later. Divorce is a nuclear bomb with nuclear fallout for everyone involved. Plan to not be victim to that fallout.
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Conclusion...
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The difference between discussing potential financial disagreements (together) now or later is pretty simple…
Take this on together, now… You’ll invest $750 to $2,500 and a few hours of your time together, gathering documents, talking through each other’s goals and priorities, and gaining a better understanding of mutual fairness. Play ostrich… At best, something that you did not address today, will present itself in the form of a missed opportunity or financial stressor(s) on your relationship tomorrow. At worst, you fight for years under the public eye of the domestic court and pay tens of thousands of dollars in court and attorney fees, noting capable divorce attorneys usually bill at least $250 per hour in today’s market!
If you happen to board a plane or cruise ship for the honeymoon, you’re going to hear not only about the journey, but also the emergency exit plan. Your impending financial journey is no different, and arguably much more impactful to both your lives. Don’t shortchange yourself on planning that. In the off chance your partner has a hidden “take you to the cleaners” mentality, trust us on this… you want to know now! Before your marriage legally allows them to behave that way. The good news is, even if they don’t and even if you’re dead certain that you two are not “those two”, who would end up arguing… everything we do in premarital planning has immense benefits to couples that stay together forever. You would not be wasting a single penny or single minute of your time together going through our process.
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If you would like to get started...
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Simply call our office. We'll return you planning engagement and schedule your first in-person or virtual meeting.
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One individual participating for $750 includes:
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Discovery Meeting: Discussion of goals, unique financial circumstances, and comprehensive premarital questionnaire (including questions above, plus many additional)
Premarital Benchmark Report: Containing Net Worth, Income & Expenses, Net Investible Assets, Tax Bracket, Designated Retirement Assets, Credit Analysis and Amortization Schedules for all debt
Follow up: Recommendations based on personal goals
Permanent Secure Storage of: Premarital Planning Report and collaboration with attorney of choice (if applicable)
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​Both soon-to-be spouses participating for $1,500 includes:
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Discovery Meeting: Discussion of goals, unique financial circumstances, and comprehensive premarital questionnaire (including questions above, plus many additional)
Premarital Benchmark Report: Containing Net Worth, Income & Expenses, Net Investible Assets, Tax Bracket, Designated Retirement Assets, Credit Analysis and Amortization Schedules for all debt
Follow up: Recommendations based on personal goals
Permanent Secure Storage of: Premarital Planning Report and collaboration with attorney of choice (if applicable)
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Both soon-to-be spouses participating for $2,500 includes:
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All services above plus our Focused Financial Independence Plan for Couples. If priced separately, our Focused Financial Independence Plan for Couples ranges from $1,500 to $2,500. Including this option in your Premarital Planning package is by far the best value and provides more detail, leading to comprehensive answers, if both soon-to-be spouses participate. See attached supplement on Focused Financial Independence Plan for Couples. We highly recommend adding this to service to address the financial planning fundamentals covered vs. only the premarital considerations.
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What is Pointer Creek's Focused Financial Independence Plan for Couples?
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In short, answers.
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Answers that make life better. Answers that systematically reduce or completely eliminate each of your financial concerns. A refined process that clearly shows both of you exactly where you stand today, and exactly where you stand together in the future if you continue living out your current plan (or perhaps lack of plan). A “crystal ball” that allows us to hypothetically live your life 1,000 times using financial planning software. We simulate countless real-life variables into your specific financial situation to produce a range of outcomes. This gives you the power and information to live life in balance, achieving the perfect harmony of today and tomorrow, with no regrets decades down the road. The back of this page has a couple dozen sample questions from the hundreds we consider in creating your Focused Financial Independence Plan for Couples.
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​What is our process for all this?
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Discovery Meeting - We identify your specific personal goals related to financial planning and financial security. We collect your thoughts, financial information, statements, tax returns, and talk through a series of goal-oriented questions in our trademarked Confidential Client Questionnaire.
(Behind the scenes) – Data input and data testing from the statements and answers that you provide us. Building of your reports and initial discussion points / initial recommendations.
Data Verification Meeting – Your financial life in the limelight. For maybe the first time, you see everything you have, together in one place and how those accounts and decisions interact. You play the role of Scrooge and this meeting plays the role of Ghost of Christmas Yet to Come. We find out how you feel about that future and begin discussing opportunities you have to improve.
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(Behind the scenes) – Number crunching, spreadsheet building, creation and input of your alternate scenarios, fiduciary analysis.
Plan Strategy Meeting – We deliver. Delivery of your specific, 100% custom, actionable, non-proprietary, written fiduciary recommendations to work toward your goals. Complete walk-through of each step.
Implementation & Monitoring – One year of comprehensive follow through at scheduled intervals to make absolutely sure your investment of time and money is as productive as it was intended to be. Calendar reminders, follow-up check-ins, calls and meetings, assistance in opening, closing, transferring, enrolling, cancelling, modifying, or implementing any of the written recommendations or additional inquiries that arise in your 12-month plan period.
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Investment Required
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This plan is priced from $1,500 to $2,500 based on complexity, requires your attendance at 3-6 meetings over a 12-month period, and several hours of “homework” in gathering the information we need from you. Like physical fitness, financial fitness is garbage in - garbage out; the harder you work upfront to provide accurate data, the better your results will be!
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Sample Question we answer in the process of our Focused Financial Independence Plan for Couples
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1. How much are we on track to have saved at retirement? Will that be enough?
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2. What should we be saving for retirement to maintain our lifestyle? Do we have enough now to be on track?
3. Where do we rank relative to our goals?
4. What should we be considering for our future now, considering what the market is doing?
5. Should we be contributing to Roth IRAs? What if we can’t contribute directly? Is a back-door Roth for us?
6. What tax bracket are we in?
7. Are there strategies that can keep us in a lower tax bracket now?
8. What we can do to stay in a lower tax bracket in retirement?
9. Are we taking advantage of all the tax advantaged employer benefits that we should be?
10. Are the investments we hold allocated properly for our risk tolerance and timeframe?
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Disclaimer: Planning services dispensed by Bryan M. Renner, CFP ® a Certified Financial Planner™ practitioner acting as an Investment Advisor Representative of Cambridge Investment Research Advisors Inc., a Registered Investment Advisor. Securities offered through Cambridge Investment Research, Inc., Member FINRA/SIPC. Pointer Creek Wealth Management and Cambridge are not affiliated. Pointer Creek Wealth Management and Cambridge do not provide legal advice. Any advice provided during the premarital planning is coincidental to providing financial planning services, as a Certified Financial Planner™.