Did Chelsea Have the Talk Before She Did the Walk?
By Susan Hirshman
Even if you were busy watching “Jersey Shore” or immersed in this season’s must-have beach read, you know Chelsea Clinton got married this past July. She married Mark Mezvinsky who has a successful Wall Street career.
We heard all about the dress, her makeup, the food and the guests, but we didn’t hear anything about one of the most important aspects of any wedding – Money. Did they have the “talk” prior to getting married, is what I would like to know. By “the talk,” I mean how is their wealth going to be handled?
Are they going to have what’s mine is mine and what’s yours is yours? Or are they going to co-mingle their assets? Or perhaps they’ll find a place somewhere in the middle – a yours, mine and ours approach.
Which do you think is the right answer? Well, that’s a trick question, because there is no right answer here. The right answer is the one that best fits the relationship, family dynamics and financial situation. In reality, this can be summed up in two words: power and control.
How much control of your assets are you willing to give up? None? All? Some? For example, if you put your money in a joint checking account you are giving up a lot of control. Why? Because once you put assets in joint name you both have rights to it; meaning that your spouse can, without you being aware or being there, withdraw all of the money from the checking account and use it as he wishes. So let’s briefly look at the three aforementioned factors – relationship, family and financial situation and ask yourself how they affect your need for a degree of control.
First: Relationship. What has been your history? Are you fighters or lovers? Will you always be that way? I hate to be Debbie Downer, but we all know the statistics – 50% of marriages end in divorce. So do you want all your money to be co-mingled or would you have a joint account along with your own private account?
Next: Family dynamics. Are there yours, mine and ours children? Is he not your first husband (or are you not his first wife?). If you co-mingle all your assets and there are separate families, it often causes great strife between one side and the other. For example, if your children think that your new husband is spending their inheritance, it tends not to be a pretty picture.
Last, but not least is your financial situation. Is one spouse wealthier than the other? Does one spouse spend more than the other? If you work, will you continue to do so after you get married and start having children?
The bottom line is this: the only one who can decide what is right for you is….well you. It’s your money and your future.
Susan Hirshman, CFA, CPA, CFP,