Distributing assets between myself and my wife
Discussion
Hi all,
Appreciate the collective wisdom of this place.
I got married 3 years ago. Before we got married i was living with my wife, i owned an apartment which benefited from exceptional capital growth and i remortgaged in order to take out equity which i used to purchase a house which we moved into. The apartment became a buy to let.
I purchased the house in my name only before marriage and have gone on to purchase other buy to lets which are in a company.
My wife worked until we had children 4 years ago and contributed to mortgages and running costs while she worked. She stopped working after the birth of our second child.
Everything we own is in my name because i purchased it with a mix of bonuses from work, equity drawn from property and my Dad has also very kindly given me some cash gifts.
We are currently in the process of sorting finances as we move into another life stage - ie wife not working and the question as to everything being in my name has come up. I am thinking of transferring 1/2 house into her name and 25% of the company which owns our buy to lets.
Our relationship is good but I'm a bit uncomfortable because it feels a bit like agreeing a divorce settlement!
Any words of wisdom are appreciated!
Thanks
Appreciate the collective wisdom of this place.
I got married 3 years ago. Before we got married i was living with my wife, i owned an apartment which benefited from exceptional capital growth and i remortgaged in order to take out equity which i used to purchase a house which we moved into. The apartment became a buy to let.
I purchased the house in my name only before marriage and have gone on to purchase other buy to lets which are in a company.
My wife worked until we had children 4 years ago and contributed to mortgages and running costs while she worked. She stopped working after the birth of our second child.
Everything we own is in my name because i purchased it with a mix of bonuses from work, equity drawn from property and my Dad has also very kindly given me some cash gifts.
We are currently in the process of sorting finances as we move into another life stage - ie wife not working and the question as to everything being in my name has come up. I am thinking of transferring 1/2 house into her name and 25% of the company which owns our buy to lets.
Our relationship is good but I'm a bit uncomfortable because it feels a bit like agreeing a divorce settlement!
Any words of wisdom are appreciated!
Thanks
nichio3478 said:
Our relationship is good but I'm a bit uncomfortable because it feels a bit like agreeing a divorce settlement!
If all's good then it begs the question as to why bother? A good will covers share of gains after death.
I may be wrong but I can't seem much in the way of tax advantage.
I think there are a couple of different angles to this.
Maybe you guys could find benefit in a post-nuptial agreement. My wife and I actually had a pre-nuptial for a couple of different reasons and while a weird thing to think about at the time, we both actually walked away from the discussions with a positive feeling towards the process. We did both have reasonable representation and we were both completely open and honest with each other.
The reality is that if you were to divorce, there would be a separation of assets, regardless of who is named as the actual owner. That doesn't deal with the other angle - the psychological angle. Women tend to take comfort and security in having a safety net/emergency fund/financial stability. Is this the angle she is approaching the request from - does she feel more secure if she stops work for a few years and then you were to run off with a younger model?
Oh, and definitely have a will that you regularly review.
The final thing I would add to this is that if I were to die (and the stats say I'm going to die before my wife), as things stand right now, she would be financially ok however I am also aware of the fact that between my death and "being ok" there is a period of time that without some money, my wife could find times tough. Her name, as well as my name is on most of our significant cash holdings so that she would have access to walking around money for any expenses she may have (throwing my body in the sea and having a party, probably!!). Again, some security for her.
None of this is 'fun' to talk about - your death/divorce, but having a plan and being prepared is better than not.
Maybe you guys could find benefit in a post-nuptial agreement. My wife and I actually had a pre-nuptial for a couple of different reasons and while a weird thing to think about at the time, we both actually walked away from the discussions with a positive feeling towards the process. We did both have reasonable representation and we were both completely open and honest with each other.
The reality is that if you were to divorce, there would be a separation of assets, regardless of who is named as the actual owner. That doesn't deal with the other angle - the psychological angle. Women tend to take comfort and security in having a safety net/emergency fund/financial stability. Is this the angle she is approaching the request from - does she feel more secure if she stops work for a few years and then you were to run off with a younger model?
Oh, and definitely have a will that you regularly review.
The final thing I would add to this is that if I were to die (and the stats say I'm going to die before my wife), as things stand right now, she would be financially ok however I am also aware of the fact that between my death and "being ok" there is a period of time that without some money, my wife could find times tough. Her name, as well as my name is on most of our significant cash holdings so that she would have access to walking around money for any expenses she may have (throwing my body in the sea and having a party, probably!!). Again, some security for her.
None of this is 'fun' to talk about - your death/divorce, but having a plan and being prepared is better than not.
Playing Devil's Advocate for a moment why isn't your wife going to be a 50% shareholder in the BTL business? After all, you jointly made the decision to get married, have children (which stopped her working & supporting herself) & that she not go back to work.
Should she not also need to be building up a pension of her own, equal is size to yours?
Should she not also need to be building up a pension of her own, equal is size to yours?
Thank you for the responses, much appreciated.
My wife is coming at this from a seeking some reassurance that she will not be stiched up financially. The reason we have ended up in a position where everything is in my name is due to how it's naturally evolved. Plain and simple.
The post nuptual agreement is a really good idea. I will do some research into these as this could be a really simple way of dealing with it. One of my main concerns is that as everything is mortgaged, we would have to effectively reapply for everything which would be enourmously expensive and time consuming.
My wife is coming at this from a seeking some reassurance that she will not be stiched up financially. The reason we have ended up in a position where everything is in my name is due to how it's naturally evolved. Plain and simple.
The post nuptual agreement is a really good idea. I will do some research into these as this could be a really simple way of dealing with it. One of my main concerns is that as everything is mortgaged, we would have to effectively reapply for everything which would be enourmously expensive and time consuming.
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