Why treating marriage as a business deal can save your assets

[UNITED STATES] In the glittering world of celebrity and wealth, where fairy tale romances often meet harsh realities, one voice stands out with pragmatic advice that might just save your fortune – and your heart. Kristina Royce, a veteran divorce attorney with 23 years of experience representing high-net-worth individuals, including celebrities and entrepreneurs, has a message that may seem unromantic at first glance but could be the key to a more secure future: treat your marriage like a business transaction.

"A big mistake my clients make when entering marriage is ignoring the business aspects of their relationship because they want to focus on being madly in love," Royce explains. "However, marriage is a business transaction with the potential for huge financial consequences, so it needs to be treated as such."

This advice might raise eyebrows, but in a world where nearly half of all marriages end in divorce, and high-profile splits can lead to multimillion-dollar settlements, Royce's perspective is grounded in hard-earned wisdom. Let's delve into the insights of this celebrity divorce attorney and explore how her advice can benefit not just the ultrawealthy, but anyone looking to protect their assets and emotional well-being in marriage.

The Three Pillars of Marital Intimacy

Royce believes that a successful marriage requires three types of intimacy: sexual, emotional, and financial. While the first two are often discussed and nurtured, financial intimacy is frequently neglected, leading to potential conflicts down the road.

"Financial intimacy, which I view as having uncomfortable conversations about finances and money, is often neglected," Royce points out. These conversations, though challenging, are crucial for building a strong foundation for marriage.

Building Financial Intimacy

To cultivate financial intimacy, couples should:

• Be transparent about income and assets
• Discuss financial goals and spending habits
• Agree on how to handle joint and individual expenses
• Plan for major life events and their financial implications

By fostering open communication about money matters, couples can align their financial expectations and reduce the risk of future disputes.

Prenuptial Agreements: A Love Letter to Your Assets

For high-net-worth individuals and celebrities, prenuptial agreements are not just a safety net – they're a necessity. Royce advises her clients to view prenups as a form of insurance, protecting both parties' interests in case of divorce.

"I know it's taboo to talk about, but I tell clients to consider having a pre-marriage consultation with a divorce lawyer to understand their rights and the implications of such a weighty financial decision," Royce states.

A well-crafted prenuptial agreement can:

• Define separate and marital property
• Outline spousal support terms
• Protect business interests and intellectual property
• Establish guidelines for property division in case of divorce

By addressing these issues upfront, couples can enter marriage with clarity and peace of mind, focusing on building their relationship rather than worrying about potential financial disputes.

The Hidden Dangers of Commingling Assets

One of the most common pitfalls Royce observes in high-net-worth divorces is the commingling of assets. This occurs when separate property (such as inherited funds or pre-marital assets) is mixed with marital property, making it difficult to distinguish between the two during divorce proceedings.

"For example, a spouse inherits a large sum of money and comingles it into several joint assets like the house, businesses, and bank accounts. If this couple gets divorced, they face the burden of tracing all of the money," Royce explains.

To avoid this issue, Royce recommends:

• Keeping inherited or pre-marital assets in separate accounts
• Documenting the source and use of separate funds
• Consulting with a financial advisor on how to manage separate and marital assets
• By maintaining clear boundaries between separate and marital property, individuals can protect their assets and simplify potential divorce proceedings.

Career Considerations in Marriage and Divorce

For many couples, especially those with high-earning careers, decisions about work and family can have long-lasting financial implications. Royce has seen numerous cases where one spouse sacrifices their career for the family, only to face significant challenges during divorce.

"I've seen it all too often that a spouse gives up their job to be a stay-at-home parent while their partner becomes the breadwinner. When they get divorced years later, the unemployed spouse has to rely on potentially minimal spousal support while being left to mend a gaping career gap that took place during a critical period of professional development," Royce cautions.

To mitigate these risks, couples should:

• Discuss career plans and expectations before marriage
• Consider the long-term financial impact of career decisions
• Explore options for maintaining professional skills and connections even during career breaks
• Include provisions for career support or retraining in prenuptial agreements

By planning for various career scenarios, couples can ensure that both partners are protected financially, regardless of how their professional lives evolve.

The Importance of Ongoing Financial Transparency

Maintaining financial transparency throughout the marriage is crucial for preventing surprises and conflicts during divorce. Royce advises couples to regularly review their finances together and keep each other informed about significant transactions or changes in financial status.

"I've seen situations where one spouse handles all of the finances, and their partner doesn't know what and how much they own. They worry that questioning their partner would signal distrust," Royce notes.

To promote ongoing financial transparency:

• Schedule regular financial check-ins with your spouse
• Maintain joint access to important financial documents and accounts
• Discuss major financial decisions together
• Consider working with a financial advisor as a couple

By fostering a culture of openness and collaboration around finances, couples can strengthen their relationship and reduce the potential for conflict.

Navigating High-Profile Divorces: Lessons for Everyone

While celebrity divorces often make headlines for their astronomical settlements and dramatic disputes, Royce emphasizes that many of the principles apply to couples at all income levels. The key is to approach divorce with a focus on fairness and efficiency rather than emotional retaliation.

"Divorce requires transparency, so I advise clients to come to me when they're ready to share their information without hiding anything from me. Don't spend your time and money fighting over whether certain information, like a business evaluation, should be produced," Royce advises.

For those facing divorce, Royce recommends:

• Being honest and transparent about assets and finances
• Focusing on long-term financial stability rather than short-term gains
• Considering mediation or collaborative divorce to reduce conflict and costs
• Prioritizing the well-being of children and family relationships over financial disputes

By approaching divorce with a clear head and a focus on fair resolution, couples can minimize the emotional and financial toll of ending their marriage.

While Royce's advice to treat marriage like a business transaction may seem unromantic, it's rooted in a deep understanding of the complexities of modern relationships and finances. By addressing the business aspects of marriage head-on, couples can create a stronger foundation for their love to flourish.

"From before marriage to during divorce, transparency and honesty will work in your favor," Royce concludes. This principle, applied consistently throughout a relationship, can help couples navigate the challenges of marriage and, if necessary, divorce with greater ease and fairness.

Whether you're a celebrity, a high-net-worth individual, or simply someone looking to protect your assets and heart, considering the business side of marriage can lead to a more secure and harmonious union. After all, a little financial planning might just be the most romantic gesture of all.