The Lessons I’ve Learned From My Friends’ Expensive Divorces - Kanebridge News
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The Lessons I’ve Learned From My Friends’ Expensive Divorces

So many couples I know have broken up, or contemplating it. It has given me a lot to think about for my own relationship.

By JULIA CARPENTER
Tue, Mar 5, 2024 10:20amGrey Clock 5 min

My girlfriend and I treat the outside of our apartment fridge like one big collage.

In the past few years, after attending wedding after wedding after wedding, we have unwittingly created a standing scrapbook of “Save the Date!” magnets and floral-patterned invitations, among other gilded mementos. But recently, we decided it was time to give the fridge collage a refresh. And in doing so, we realized something depressing: The majority of the happy-looking couples pictured were either now divorced, breaking up or in the process of seriously re-evaluating their relationship.

As a friend, I’ve learned so much from my newly divorced pals, and I admire the resilience, optimism and strength they demonstrated in the face of their breakups. But as a personal-finance columnist, I have also taken a lot of money lessons from these new divorcées—and I believe the insight is relevant to more than just other married couples.

One friend was able to rely on her prenuptial agreement to save her close to $100,000 in the wake of a speedy split; another woman I know escaped a financially abusive relationship with less than a grand to her name remaining in her savings account.

Darla Gale , a California-based therapist and founder of Heartstrings Counseling, says she often talks with clients about making meaning from these relationships and the accompanying financial fallout. Sharing lessons and experiences is one way to do so. “Money comes up a lot in my practice, because financial hardships are one of the reasons for divorce,” she says. “It can be very empowering to say, ‘I can do this on my own. I just didn’t have the tools to do it on my own.’ ”

Together isn’t always better

The dissolution of a relationship can bring a host of financial lessons that shape how we talk about money in our relationships going forward—whether we were the bride, the groom or the smiling person snapping a selfie with the cake.

In my previous reporting, I’ve researched quite a bit about just how beneficial it can be for couples to combine finances. Studies show this enables them to maximise their potential to grow wealth and even leads to both partners feeling happier in the relationship.

But after witnessing their first wave of divorces, many younger people are embracing a different approach. “I’m doing a lot of prenuptial agreements for people who are younger, and they are for the most part wanting to keep their money separate, which is interesting and very different from the way prenups were done 10 to 20 years ago,” says Lisa Zeiderman , a New York-based divorce lawyer.

Gale says she now often sees couples doing both: sharing expenses in one joint account, for example, while still maintaining separate funds “so it doesn’t feel like one person is more in control.”

Inspired by this approach, my girlfriend and I have adopted something similar. To save for a down payment on a future house, we contribute near-equal amounts to a joint high-yield savings account that we opened together. We also share a credit card to use when we buy groceries, pay our dog’s vet bills or handle other shared expenses.

But at the same time, we both maintain separate checking accounts and saving accounts, for our own individual needs. This way, should disaster ever strike, we’re both able to maintain a level of personal autonomy and build our own lives anew.

After all, as Gale put it, “Autonomy equals equality.”

Older is better…and worse

Here’s the good news I’ve learned while looking at divorce through a personal (and personal-finance) lens: On the whole, millennial couples are actually divorcing at lower rates than people of previous generations at similar ages.

Economist Brett House , a professor of professional practice in the economics Division at Columbia Business School, attributes this decline to two important things: Millennials are getting married at later ages. And they’re likelier to have received more education by the age of their first marriage.

But waiting to tie the knot doesn’t protect you against the financial fallout of a divorce—if anything, marrying later means both parties might have had more time to accumulate more assets that could lead to financial conflict once split.

“People may be more mature and more aware of themselves and clearer about what they want from a relationship than was the case in earlier years,” House says.

Gale recommends clearly stating those financial priorities at the start of a relationship, when everything still seems rosy. “Don’t be sneaky about it, but go into the relationship and say ‘I’m going to have a separate bank account, whether that is for going out or having a ‘fun’ fund but autonomy is really important to me,’ ” she says.

And watch your potential partner’s reaction to such a conversation—that can also inform your decision to build a life with them.

Don’t compromise your career

In her many years advising women and working in divorce courts, Zeiderman says she often gives young to-be-married women the same advice: Don’t lose sight of your career.

Zeiderman has seen firsthand how difficult it is for many people, in compromising their own professional trajectories, to rebuild their earnings post-divorce.

“So many decide, frankly, to let the other person build their career and then at the end of the day, you cannot make up for this in spousal support, you cannot make up for it in the distribution of their assets,” she said. “Stay in the workforce. You must.”

We like to think that is easy to do, but in practice, both partners prioritising their careers isn’t easy.

This summer, I’ll have just embarked upon a new career as a freelance writer and podcast host; at the same time, my girlfriend, also a journalist, will be traveling throughout France covering the summer Olympics. We talked in advance about how important this summer will be for us, work-wise, and agreed that although our relationship—and our patience!—may be tested, affording each other some grace during this high-pressure time will go a long way. Building our careers will benefit our household bottom line, but it’s also insurance for both of us.

The ‘what if we broke up’ talk

“The forethought is easier to do when things are good,” Zeiderman told me. And her words stuck with me.

I thought back to the dozens of conversations I’ve had with my divorced friends. So many of them regretted never discussing money goals, habits or strategies with their partners in advance of marriage. Far too often, they said, they worried bringing up finances would dampen the excitement of the honeymoon phase; then, months or years later, the unsaid words curdled and soured with resentment.

My girlfriend and I keep a standing monthly “money date” on the calendar. We make the time to curl up on the couch, just the two of us, and review our household finances. For us, that looks like going over the bank statement and checking on progress made toward our financial goals. On past money dates, we’ve compared prices for coming purchases, paid down debt and even shared how things stand in our separate personal accounts.

No one likes paying bills or calculating debt totals, but we work hard to make the process as painless as possible. But this coming month, I think the topic I have planned may be our most uncomfortable one yet.

That’s because, inspired by Zeiderman and Gale, this time I have something particularly “special” planned for our money date: the “What if we broke up?” conversation.

I want to plan out how we would divide our shared assets and then put these details in writing—together. If something were to happen in the future, we could hopefully put aside our differences to rely on this plan and make the detangling of our finances much simpler.

Luckily for me, my girlfriend knows me well enough by now to see the romance hiding in this gesture.



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Strong family financial planning can help reduce taxes and support younger generations. From intrafamily loans and asset gifts to inheritance disclaimers, strategic cooperation can create meaningful financial benefits—when families have the trust and structure to make it work.

By Laura Saunders
Fri, Oct 9, 2026 4 min

Happy is the family whose members—parents, grandparents and grown children—trust each other enough to cooperate on shared goals, especially financial ones. When that is truly the case, Uncle Sam’s tax rules can help as well.

This matters especially now that mortgage rates are above 7%, and many families are looking for ways to help younger members. If the elders have resources and are confident younger ones can cooperate, a family loan could make homeownership possible while providing the elders with a useful income stream.

Other strategies can actually lower taxes, such as when funding 529 plans or Roth IRAs, or when someone inherits a traditional IRA with required withdrawals larger than they will need.

Here are three strategies useful for functional families.

Intrafamily loans

It is perfectly legal for families to lend money to a relative for a down payment or even a private mortgage.

But it is important not to cut corners, says Ryan McKeown, a CPA with Modern Wealth Enhancement in Minnesota. If the loan is for a down payment, be honest with the mortgage provider and have a formal agreement. The lender owes tax on the interest payments received.

If the loan is for a private mortgage, both sides should have legal representation with a formal written agreement, including payment terms. The lender owes tax on the interest, and the borrower often can deduct it if he or she itemizes.

To avoid IRS trouble, the interest rate shouldn’t be lower than the agency’s Applicable Federal Rate at the time of the loan. Currently that is about 5% for loans longer than nine years; about 4.5% for loans three to nine years; and about 4% for loans three years or less. Currently, traditional mortgage rates are generally above 7%.

In addition, the lender could use the $19,000 annual gift-tax exemption (described below) to forgive some or all of the interest or principal annually. If both lenders and borrowers are married, that is up to $76,000 a year. There is no tax for the borrower on such forgiveness, because it is from a gift.

If you’re going this route, McKeown advises against having a fixed plan to forgive the debt. Instead, do it in one-off letters specifying the amount—and keep careful records. Otherwise the IRS might try to treat the loan as a taxable gift.

Asset gifts

Powerful tax-saving moves for families often use gift-tax provisions. Under current law, anyone can give anyone else up to $19,000 of assets annually, free of gift tax. That means a married couple with three grandchildren could give them a total of $114,000 in 2026.

The gifts can be cash or other assets, like stock. For noncash gifts, the cost basis—which is the starting point for measuring taxable gain after a sale—“carries over” to the recipient. So if someone buys $1,000 of stock and gives it away when it is worth $5,000, the recipient’s cost basis is $1,000. If the recipient later sells the shares for $8,000, the taxable gain is $7,000.

Here’s an example showing how gifts could save a family taxes. Grandma is a widow of modest means, while her child and spouse have prospered. The couple has two children, and they want to contribute $5,000 to a 529 college-savings plan for each—but they need to sell stock to do it. Their tax rate on the sale would be 18.8%, and they would need to sell about $11,000 of stock.

However, Grandma’s federal tax rate on the stock sale is 0%. If the couple gives $10,000 of shares to Grandma, she could sell them, pay no tax, and fund the grandchildren’s 529 plans. This saves about $1,000 of tax.

These moves are legal, and they could be used in other ways, such as to help a young person fund a Roth IRA.

But trust among family members is essential: Under the law, givers can’t put conditions on a gift. Grandma could use her stock proceeds to take a cruise, but she makes 529 contributions instead.

Mark Sellner, a retired tax attorney and CPA living in Sarasota, Fla., uses this strategy. His children sell stock he gives them and fund 529 plans for his grandchildren.

The family’s tax savings aren’t huge, but he likes other benefits. The sales by his children don’t boost his adjusted gross income, which in turn could raise his Medicare Irmaa premiums or his 3.8% surtax on net investment income.

Sellner doesn’t worry about his children using the funds for another purpose.

“There can’t be any strings attached to gifts. Of course, it is up to us to decide whether to make them in the future,” he says.

Two caveats: The “kiddie tax” applies to most children under age 24, and it is levied at the parents’ rate on investment income above $2,700 in 2026. Consider this before making gifts to a young person.

Investors who give away stock also forgo the step-up, an important provision that exempts assets held at death from capital-gains tax.

Sellner knows he’s losing a step-up, but says, “The children could use a little more now. Why should they wait 20 years to get it?”

Disclaimers

A disclaimer is a highly useful strategy in which one heir renounces an inheritance in favor of another heir. Assuming family members cooperate, this can save taxes.

Here’s one example. Dad died and had a large traditional IRA that he left to Mom. She has enough assets and income to cover her expenses, and she lives in a state with a stiff estate tax. The inherited IRA would put her estate over the threshold.

Also surviving are three young-adult children. If Mom disclaims all or part of Dad’s IRA within nine months of his death, that amount could go directly to the children. They will have 10 years to empty the account, and the family as a whole will likely save estate and income taxes.

Disclaimers have many key details, especially regarding beneficiary documents. Although heirs have great freedom in choosing what assets to disclaim, the rules about who gets disclaimed property are rigid. It is best if the original owner names tiers of heirs so that if one disclaims, the next recipient is clear.