What kind of financial advisor do we need?

August 4, 2023 9:05 PM

I know the general advice is to get a fee-only financial advisor, but I’m not sure exactly if there’s someone more specific we need in this situation. My partner and I are considering getting married and eventually having kids. What we’d like to understand better is how our assets pre- and post-marriage are treated.

I know that very generally, assets pre-marriage stay as separate property and assets post-marriage are communal property. I also know that sometimes putting “marriage money” into a pre-marriage asset makes it a communal asset.

But:

What if one of us owns a rental condo and we put post-marriage money into fixing it up or renting it out? (Operational expenses or paying the mortgage?) Does that make it communal (the asset and debt?)

What about retirement accounts? If one of us just started a new job and has a new 401(k) is that a communal asset but not the previous job ones? What if we roll them into a new account? What if the other person has been at the same job for a long time and so they continue to contribute to an older 401(k)? Same with non-retirement investments?

What if one of us contributes more to the 401(k) or has a higher company match?

Is it worth making an LLC for the rental?

What if we live in a condo owned by one of us when we get married and both contribute communal money to the property? But only one of us is on the title.

How much of this depends on the state we live in/get married in/divorce in (hopefully not)/die in?

I’m open to personal knowledge and anecdotes, but mostly I’d like to know who we can hire to teach us these things.

posted by sillysally to Work & Money (7 answers total)

these are almost all questions for a family law attorney, not a financial advisor. The same attorneys that divide up assets in divorces also draft up prenups and can advise you on how married people's money gets treated under the law in your jurisdiction.

the one about the LLC for the rental could be a reasonable question for an accountant.
posted by fingersandtoes at 9:21 PM on August 4, 2023 [13 favorites]

Yeah, you want a family law attorney, preferably one who does prenups. Laws vary widely state to state (and if you split up, the law that controls is the law where you file for divorce, not where you got married). If you have specific ideas of how you’d want to divide assets during the marriage and if you ever split up, get a prenup.
posted by decathecting at 9:36 PM on August 4, 2023 [1 favorite]

I know that very generally, assets pre-marriage stay as separate property and assets post-marriage are communal property.

This is highly highly state dependent, and specifically the state you potentially die/get divorced in. There is no general advice here - there is only potentially blatantly incorrect advice (specifically if someone gives suggestions based on a community property state vs an equitable distribution state). You've given no indication which state you live in. This question is not answerable.
posted by saeculorum at 9:37 PM on August 4, 2023 [2 favorites]

Response by poster: The state we live in now is very likely not the state we would get married in/live in after marriage, and who knows where we’d be if we ever got divorced. So mostly looking for who we could hire to help us figure this all out.

Thanks for the answers so far, family law attorney seems like a good start!
posted by sillysally at 9:45 PM on August 4, 2023

Divorced person here. I just want to say that you are doing the right thing by researching this now. Divorce lawyers doing financial forensic accounting are EXPENSIVE.

In terms of some of the questions you posed, I have heard of friends who did set up an LLC. Also for some things they wrote up contracts that spelled out what they agreed to.
posted by JohnnyGunn at 10:20 PM on August 4, 2023 [2 favorites]

Adding to saeculorum's comment, different state-to-state and also changing year-to-year with remarkabie and dismaying frequency.
posted by SemiSalt at 4:26 AM on August 5, 2023

I think you might want a lawyer with experience in tax and family law as well as estate planning.
posted by kat518 at 8:16 AM on August 5, 2023