For Those About to Propose
mod (Andy) note: "Blast from the past - Best of Eddie" - This one is originally from January 2011. If there's an old post from Eddie you'd like to see up again shoot me a message.
With Valentine's Day two short weeks away, some of your girlfriends are no doubt ratcheting up the pressure on you to pop the question on the most romantic day of the year. Maybe you already live together. Maybe you've been going out for a few years. Maybe you met her in a Chelsea dive bar on Tuesday. It's no matter. They all want the same thing.
Allow me to introduce Charles Brandes. Sure, he's a big shot today pulling in an estimated $16 million a month, but he wasn't always. He was once just a young monkey like all of you. And therein lies his cautionary tale. For it was at that point in his career that he met Linda King Formo, a single mother earning $6 an hour as a librarian.
Brandes started his own firm in 1974 and was content to grow his AUM over the subsequent decade. He met Formo in 1983 and, after a three-year courtship, they were married in 1986. Even though he wasn't a BSD yet (he made about $180,000 in 1986), he obviously went into the marriage with some reservations, evidenced by the pre-nuptial agreement he presented to her which she refused to sign.
Let me say that again for the cheap seats, because it's important that you get it. He presented her with a pre-nuptial agreement and she refused to sign it. She allegedly told him at some point before the wedding that, "I will have no claim or interest in your business", but she denies ever saying it and it's impossible to prove and not legally binding anyway.
Fast forward 18 years to 2004. The marriage is over, and they're in divorce court. Charles is now a very big deal, and the lifestyle he has lavished on Linda could be described as over the top by any sane measure. By California statutes, he can only be forced to pay her $36,400 per month in spousal support but, either out of genuine concern for his soon-to-be ex-wife or his desire to head her off at the legal entanglement pass, Charles gives her a home in Rancho Santa Fe, a beach house in Del Mar, a Central Park penthouse and two other Manhattan condos, and two condos in Salt Lake City. To alleviate any liquidity concerns she might have, he throws in $18.7 million in cash.
Guess what?
It's not enough.
The interest alone on the money he gave her generates $155,000 a month. He throws another $350,000 a month into the pot, bringing her monthly income to a staggering $500,000. But she's just scraping by, and has now set her sights on the $140 million he has in various S-Corporations. The reason she can't make ends meet?
- $30,000 a month at the casinos
- $340,000 Mercedes Maybach
- Upkeep on her various mansions
- The 210 pairs of shoes in her closet
- Half a million a month doesn't go as far as it used to, yo
Just so you don't think she's not deserving, she'll tell you she was instrumental in his success. How? She convinced him to dress better, get a nose job, and she busted his balls to work harder 'cause mama needs new shoes.
Guys, I hope you see where I'm going with this. You might be worthless today, but chances are you won't always be. You pay for car insurance, health insurance, life insurance (if you don't, you should). Why would you leave such an obvious financial vulnerability unprotected?
The best advice I can give is don't get married. Ever. There's just no percentage in it for a young guy with significant earning potential. Especially if there's a major income disparity between you and your significant other (hedge fund manager vs. $6 an hour librarian).
But I've been married three times myself. Just so I don't sound like a hypocrite, if you must get married - by all means protect yourself. A pre-nup doesn't mean you love little Susie Rottencrotch any less. And she won't hesitate to sign it, if her intentions are pure. If she does hesitate, that should tell you something.
Have a great weekend, guys, and don't fall into the Valentine's Day trap.






Comments
I'm intrigued in this part,
I'm intrigued in this part, being a bystander (not getting married while these kind of stories go around, not because I'm scared but you can bag some serious hotties).
Does anyone know how does a court force you to declare all your financial assets and income? They can go by tax returns, but not if you're registered to a Cayman Island company or to a government that doesnt recognise the court's jurisdiction (hi china).
T
Don't kid yourself. The
Don't kid yourself. The courts don't have anything to do with it. If you're worth anything over $500,000 liquid, the first thing your wife's divorce attorney is going to do is hire a forensic accountant to find all your ratholes.
Sad story. I just got
Sad story. I just got married so I can't comment like I know anything, but I can't picture my life without her. If I lost her, it would be worse than losing all of my money (which I have none right now anyway--plus she is working and supporting me while I go to Business school. When she waited a year for me while I was in Iraq I think that showed her character as well. If I am successful one day it will be because she was my supporting co-pilot in life, and for that reason if we ever split, I think 50% is fair.
Eddie, I appreciate you
Eddie, I appreciate you writing that directly to me...but not to worry...if I got married, I couldn't come run with the bulls with you and the boys this summer!! The bulls are much safer in the short and long-run...Viva Encierro!
A good friend will come and bail you out of jail...but a true friend will be sitting next to you saying, "Damn...that was fun!"
I would't go for that risk. I
I would't go for that risk. I just reassured myself ex-wife has an accident and relax. Surely cheaper than other options. And accidents just happen.
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Nice post Eddie. Man,
Nice post Eddie. Man, stories like that really scare the crap out of me. It actually wouldn't suck that much to be in his position, since he'll still be ridiculously wealthy even if he pays that much. Don't get me wrong, it definitely still sucks and on principle alone it really bothers me. All I'm saying, is that it scares me less to think I could be in his shoes, and more to think I could be pulling in $100K and have to give $30K-$40K to some chick.
I could be totally off-base here, but I think there are two things which don't help avoid this situation: First, a lot of guys don't care how accomplished, ambitious, and successful a woman is. I think that's a mistake. If you choose to marry someone with the same level of drive and determination you have, I think it'd be easier to stick it out for the long-haul. Don't marry the waitress who would love to retire young on your money, and go shopping and eating out with her friends daily. Instead, marry the doctor or lawyer, or some chick who'd rather use your money to start and run a business or a non-profit. Second, I think a lot of guys get blinded by how cute a girl is, and forget to size her up with regards to a lot of other qualities. I'm not saying looks aren't important. It's just that when you're so focused on looks, you're more likely to find girls who are one-dimensional. Not to mention, when you're being that shallow, you're probably more likely to find girls that are shallow; basically you strike a trade: looks for money. If you're willing to pass up a 10 for a sweet and loyal 7, then I think you have a better chance of making it work. Anyway, just my 2 cents.
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Solid advice. And Jerrey,
Solid advice. And Jerrey, accidents cost more money than a contract if I'm not totally wrong. Not that familiar with accidents nowadays
As Kanye West put it "Now I
As Kanye West put it "Now I ain't sayin' she a gold digger (When I'm in Need) But she ain't messin' with no broke fellas." Be careful out there, too many people are in it for the fortune and the fame.
Quote: Don't kid yourself.
Don't kid yourself. The courts don't have anything to do with it. If you're worth anything over $500,000 liquid, the first thing your wife's divorce attorney is going to do is hire a forensic accountant to find all your ratholes.
See, my plan is to stick some of my pre-marriage assets into a spendthrift trust. Spendthrift trusts aren't considered an asset by the courts, and if you continue managing how the money is invested, it's a nice big nest egg that Mrs. Divorcee doesn't get to touch.
Not perfect, but no prenup conversation necessary. Besides, my religion is against talk about divorce before marriage.
Work hard, play hard.
I think the lesson here is
I think the lesson here is moreso don't be an idiot than be scared of marrying a woman. Now, I've been proposed to awhile ago so I'm probably biased, but I also said when we were just friends rather than even dating that I wanted a pre-nup (for my sake at least, since I plan on being wildly successful like most young monkeys), so perhaps that influenced him positively. The goal is for either sex to find a partner who is not going to use them for their looks/money/connections, because there's pretty little hope of that ever lasting.
If you're an Ivy League IB'er who has just become an MD, and you get a chick from Conn U. who loves the "experience" of shopping with you, going out to clubs and showing off to other men while buying expensive bottles of bubbly, and has no plans for future income, don't marry her. It just seems like so many of these stories involve really horrible character judgments on the men's part. Though my mother or Britney Spears with Kevin Federline are examples when women make just as terrible judgment calls.
tl;dr Don't be a dumbass and marry someone who doesn't want to build something -with- you.
these type of stories always
these type of stories always leave a bad taste in my mouth
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Quote: If you're an Ivy
If you're an Ivy League IB'er who has just become an MD, and you get a chick from Conn U. who loves the "experience" of shopping with you, going out to clubs and showing off to other men while buying expensive bottles of bubbly, and has no plans for future income, don't marry her. It just seems like so many of these stories involve really horrible character judgments on the men's part. Though my mother or Britney Spears with Kevin Federline are examples when women make just as terrible judgment calls.
I think the bottom line is that if you get married, in a healthy marriage, your career is less important than your family.
Wait until after the crush is over, and decide: would I be willing to give up my career to marry this woman? If the answer is still yes, then marriage is probably a healthy choice. Just bear in mind that it's hard to have a healthy family if you're working more than about 60 hours/week.
You can make some plans before you meet the person to protect yourself- like setting up a trust with some assets in it. (Also helps protect you from creditors and lawsuits.) But when you get married- you need to be making the decision that you want to spend the rest of your life with that person, and that you're willing to trade in your career to do that, if that's what it takes.
Work hard, play hard.
Why would you not just have
Why would you not just have this person taken out?
^ Ive had that done and it's
^ Ive had that done and it's much harder/more expensive than you think.
Sorry Eddie, But I like to
Sorry Eddie,
But I like to think that if I ever find someone to marry, she will be as smart and kick ass as I am - even if this means that we don't have as much time to be together as I would have if I married a "at your disposal" wife.
Just fooling myself? Maybe. I am cynical, but I don't like extremes. Such as "never marry".
You can get married well into
tyrets wrote: Why would you
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econ wrote: tyrets
Most of the senior level guys
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Work hard, play hard.
I wouldn't say never get
Man, I must really be behind
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Eddie, I have to say, most of
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Honestly, if you have that
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A bunch of really stand-up
Step 1: Dream the Dream || Step 2: Live the Dream || Step 3: Rinse, repeat.
Simply put: If you don't
I can understand giving her
...that being said, my last
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Jackie - pretty much hit the
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AssociateGuerilla wrote: A
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Jackiesinthesun wrote: Simply
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I would be upset, but finance
What is the problem with
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And let's face it. Out of
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manbearpig wrote: What is the
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manbearpig wrote: What is the
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anaismalcolm wrote: I think
The answer to your question is 1) network 2) get involved 3) beef up your resume 4) repeat -happypantsmcgee
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SAC - fair enough. I wouldn't
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These threads also scare the
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I've heard of cases where a
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Again, why a premarital
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Female here. Broadly speaking
Just a note about Valentine's
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