‘I couldn’t have done it without him’: I built a property portfolio of 23 units. How much should I give my fiance at our prom?

I’m going to marry a wonderful man. While we were dating, I built an investment portfolio of 23 units. Now we ask how to create a prenuptial agreement.

Over the years I have identified, acquired and managed a portfolio of rental-property in three buildings. These were bought with my own money, and I’m the sole owner on paper – but my fiance has been involved in the process and has helped with repairs and renovations from the beginning.

I couldn’t have done it without him. We recently purchased our dream home so his pre-owned home will also be added to our rental portfolio. We know we should have a prep, but we don’t know how to set it up.

‘I’m basically signing a pre-arrangement that gives him a bit of money, but I feel he’s entitled to something to help me.’

In one hypothetical scenario, he would keep the new house and my second largest investment property: $1.5 million. (He needs the investment property to afford the new mortgage.)

In the other case, I get the house he bought, which is worth less, my largest investment property, and his smallest investment property: $2.35 million.

An alternate option is that all assets are held jointly and we distribute the profits in perpetuity percentage. Nothing can be sold for cash unless both parties agree to the sale, and we decide in advance how profits will be divided.

If I choose, I have the right to manage the investment portfolio and 1031 convert any investment property into a larger investment property. In this case, I lose two-thirds of the trade and he gets one-third.

What are your thoughts on this? I know I’m signing a prenuptial agreement that gives him a small amount of money, but I feel like he’s entitled to something that helped me build it.

Property manager

Dear Property Manager,

Smart move to put everything in writing. A prenuptial agreement is one of the most important contracts you will sign, so everyone should have one. There are so many events that couples need to prepare for, including what happens on business if they separate. About 15% of couples have signed a prenuptial agreement, according to a recent poll from Harris Interactive, up from 3% a decade ago. This figure rises to 40% for couples aged 18 to 34. A prenuptial agreement forces couples to be completely transparent about their finances.

Let’s get one thing out of the way first. “I couldn’t have done it without him,” you write. It may feel or even be harder to do without him, but I have no doubt that you will do it regardless. Risk, entrepreneurship and good judgment are all at your doorstep to choose these assets at the right time. Give yourself credit for what you have accomplished. They also took a down payment and, I think, a loan. This should be taken into account when making your calculations.

You bought these properties with your own money, so He He couldn’t have done it without him you. Your fiance provided the backup, but these assets are yours. I don’t think an equal split is fair to you, and I’d be wary of signing over a lot of your business to it. I hope you live happily ever after, but 50% of marriages end in divorce and you will regret being generous. Building this portfolio took many years and work. Signing a large percentage for a third party only takes a minute.

“It took years and work to build this portfolio. It only takes a minute to sign a large percentage to a third party.’

Tricia Mulcair, a certified financial planner in Atlanta, Ga. I asked Homrich Berg, a certified public accountant, to weigh in on your letter. She is also more cautious.

“A straightforward solution might be to record the current value of various assets on your wedding day and note that if you split, the value of your assets at the time will be split based on the percentage of the original ownership,” she replied. . “If you want to give him ‘credit’ for his help with repairs and renovations over the years, you can add a percentage accordingly.”

“One way to do this is to try to gauge the number of hours your fiance has spent on repairs and renovations over the years and how much it would cost to hire a professional,” she adds. “The time spent identifying, buying and managing the portfolio is also worth hiring an outside management company, which may offset some of the investment.”

Mulcair suggests defining your plan for your rental income during your marriage. Is that split 50/50? Or 75/25?

And what happens if your fiancé has already died? If you jointly own these properties, he will inherit them himself, and your family will never see a single red penny. “In any case, it’s wise to register your mutual interest in keeping the properties until you both agree it’s a good time to sell,” Malcair adds. “It’s also important to outline the plan for how you intend to share the proceeds of any sale. It doesn’t hurt to further outline that you are the one managing the portfolio, who is entitled to participate in the 1031 exchange.”

I don’t want to pour cold water on your plans. It sounds like you both take a responsible and proactive approach to your marriage, which bodes well for future negotiations. You also spoke clearly about your options, and had difficult conversations. Getting married is an incredibly exciting time, and it’s never a good idea to let your emotions rule your finances, especially after years of toiling away at these assets.

But remember this: once you sign half of your property portfolio, there’s no going back.

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