Recently, the Upshot blog at New York Times took a hard look at the idea that 50 percent of marriages end in divorce. According to their research – it is a myth. In fact, if current trends continue, two-thirds of marriages will never involve a divorce, according to Justin Wolfers, a University of Michigan economist.
The blog post cites many reasons for the drop in divorce – people marrying later in life, birth control etc. In addition, many couples are choosing not to marry at all. There is no longer a stigma attached to couples who live together, or who choose to enter into long term relationships without marriage.
But I believe there is one more contributing factor: The fact that more and more couples are having the hard talk before they get married, and drafting marriage agreements that clearly define financial expectations at the onset. Having the difficult conversations about expectations of what each will do or not do and how finances will be handled is healthy.
Whether you decide to marry or not, a marriage or co-habitation contract is a good idea for any couple who has assets that each party is brining into the marriage. So what should be included in a marriage or co-habitation contract?
- Assets brought into the marriage: how will they be treated if there is a separation
- How spousal support will be decided in the event the relationship breaks down
- If a partner has a business, if and how the business will be divided
- If the spouses will co-own a business, how will they manage the operations of the business if one leaves after a divorce