By Shannon Hennessey, Senior Counsel at Frutkin Law Firm
Many have attended a wedding where the bride and groom dance to Lionel Richie and Diana Ross singing Endless Love. The song’s message: love conquers all. But does it? Take our crooners Lionel Richie and Diana Ross as an example, they have four divorces between them.
It is common knowledge that approximately 50 percent of all marriages end in divorce. But it may be a surprise as to how much financial tension plays into the likelihood of a marriage’s failure.
As coined by the Institute for Divorce Financial Analysts, “If marriage is all about love, the divorce is all about money.” The two most contentious issues in divorce are usually finances and children – but shockingly in that order.
Common tensions stem from:
One partner being thrifty and the other being a spender; Only one spouse being employed; A disparity in premarital assets brought into the marriage; One spouse having a significant amount of separate debt.
The underlying problem lies with lack of communication. Couples just don’t talk about money before marriage. Nearly two-thirds of married couples who responded to a poll conducted by USA Today stated they talked little or not at all before the wedding about how to combine their finances.
Tensions need not be inevitable. Prior to saying “I do,” couples should sit down either by themselves or with a qualified third party (attorney, financial planner, etc.). Issues such as the ones listed above should be discussed in a “what if” manner. Dare it be said, if a couple is fearful of addressing these issues head on, maybe marriage is not the right fit.
An option for couples is a prenuptial agreement. While there are certain legal parameters, the agreement is tailored to meet each couple’s personal situation. The process in general is as follows: the parties mutually disclose all of their assets and all of their debts. From there an agreeable game plan is mapped out.
But the bottom line is that communication is a must. Couples that tackle money problems together, and take mutual responsibility for solving them, will inevitably find that their overall relationships are better for it.