So, one can argue that a homemaker should be paid a wage. The clients were in their thirties. Kelly’s fiancé, Rich, was a successful doctor who worked for one of the major hospitals as a director of multiple urgent care centers. For this job, he worked three 12-hour shifts per week. On his off days, he had a thriving telepractice.
Rich was the driving force behind the prenup. He was also the one who suggested the collaborative life planning process (CLP). He clearly loved Kelly deeply and would do anything to protect their relationship, including the hard work required by CLP.
On the other hand, he came into their relationship with a home and a starter 401(k) and wanted them to remain exclusively his in the event they ever divorced. He also wanted his contributions to these assets during their marriage to be non-marital.
Now, many of you are probably saying to yourself, “This was just a prenup negotiation.” While the legal document we ultimately generated would be a prenuptial agreement, this was far from “just a negotiation.”
The Other Side of the Plan
Kelly was a trained nurse who stopped working two years ago when the couple had a baby. She also had a prior-born son, but his biological father had no contact and sent no support. Rich was the only father this child has known.
Kelly had no assets and no income. So she was looking for financial security for herself and for her kids. She also wanted some financial independence from Rich; she didn’t want to have to ask him every time she needed to buy deodorant. (Rich was astonished to understand that Kelly felt that she must ask. But that seemed to be how she was raised.)
The prenup was Rich’s idea and Kelly was far from enthused about what we proposed to do. That slowly changed as our team facilitator went to work and Kelly became engaged. One of the early positive results of using this process was our ability, as a collaborative team, to get Kelly to open up, to talk and share her feelings, goals, and concerns, and to do it in front of Rich. Our first victory!
Once we explored their goals and interests, both joint and individual, we gave the couple a list of items to contemplate in our second full team meeting. We talked about providing Kelly with security regarding her living arrangements, should a divorce eventually take place. But we also explored their life insurance needs, disability insurance needs, estate planning issues, and many more topics they had never discussed or considered; we tossed around many life planning issues for the marriage, asking “What if…?” a lot. This truly is a process that aims to both minimize the stress of money on marriage but also to provide security to both clients in the event that either death or divorce ends their time together.
At the same time, we were also dealing with their kids. While they seemed to be on the same page regarding their own child, we addressed to what extent Rich was willing to take on financial responsibility (beyond everyday living expenses) for Kelly’s son, both in the marriage and in the event of divorce. Some of this was purely legal, but a lot of it was aspirational, as well. How can Rich know how he’ll feel about the seven-year-old boy when he’s a teen?
Choosing assets to carve out of the shared marital estate can feel like your spouse-to-be does not trust you. The feeling of mistrust heightens all of the negative feelings that you already have about a prenup in the first place. Providing various perspectives and employing our varied skills in their collaborative life planning made the whole endeavor less taxing for our couple. Focusing on their future together, how to make it smoother, to avoid future conflicts, and to satisfy both individual and joint goals heightened the positive impact of CLP.
The Reason for Collaborative Life Planning
It is our responsibility as collaborative professionals to make life planning into a building process, a liberating exercise for our couples. According to a study by Capital Group, Americans would rather discuss anything other than money (including marital problems, religion, politics, etc.). This taboo cuts across classes, jobs, and cultures! By discussing finances, through our collaborative process, we accomplished two things: (1) we openly discussed everything that might affect their lives, particularily finances, and (2) we helped them determine what would work for them both moving forward.
Here are just some of the financial solutions we implemented, both within the legal ambit of the agreement and aspirational, as well.
Rich set up an LLC to receive his telemedicine income. From this LLC, he employs Kelly, providing her income and an opportunity to build her own 401(k). This 401(k), like his, is her sole and exclusive property. Thanks to a creative financial neutral on our team, we set up “buckets” for different types of expenses, savings, and asset growth. There is also a bucket for the cost of running the household, another for children’s expenses, a bucket for college education, as well as opportunities for Kelly to build a savings account and the couple together to expand their marital assets.
A salary for the homemaker is uncommon…but it’s not a bad idea to put into practice. With this couple, it was the solution that they needed. Kelly entered into this process with a preconceived idea of how it would unfold, but, with hard work by the professionals and the couple themselves, she and Rich came out of this process with an entire life planning strategy for their marriage.
All couples have stormy periods, many caused by financial friction or by traumatic life events for which they were unprepared. Many can be weathered with dedication to the relationship and a commitment to work things out. Others can be avoided by advance life planning, with one professional expert or another, or an entire collaborative team. If you are planning a new life together or anticipate a stressful life event, don’t hesitate to reach out to us at Open Palm Law. We are committed to helping your family find solutions, regardless of which process you choose to take you there.
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About this week’s author, Joryn Jenkins.
Joryn, attorney and Open Palm Founder, began her own firm here in Tampa after a 14-year career in law, two of which she served as a professor of law at Stetson University. She is a recipient of the prestigious A. Sherman Christensen Award, an honor bestowed in the United States Supreme Court upon those who have provided exceptional leadership in the American Inns of Court Movement. For more information on Joryn’s professional experience, take a look at her resume.