Getting married is an important commitment two individuals make to one another, usually intended to last the rest of their lives. While everyone wants marriages to last, statistically, a growing number of marriages end in divorce. As such, couples should consider spending as much time evaluating and considering prenuptial agreements as they do planning a wedding.
A prenuptial agreement—an agreement regarding the ownership and distribution of assets should a marriage fail—is entered into by a couple prior to marrying. While the idea of a prenuptial agreement has traditionally carried a negative stigma, it can save a significant amount of time, money, and headache for a divorcing couple. Some reasons why a prenuptial agreement should be considered include:
Business Ownership
It takes a lot of blood, sweat, and tears in order to start, own, and operate a business. At the time of divorce, a spouse can claim a portion of the business’s valuation or income derived from the business. This is true even if the business was in existence prior to the marriage. Thus, a divorce could be potentially devastating the stability of an existing and established business. Using a prenuptial agreement to establish that a business is to be considered a separate asset can be a valuable tool to minimize a divorce’s potential impact on the business itself.
Inheritance
It is not uncommon for individuals to wed even if they are from different socio-economic backgrounds. Often, individuals from affluent families may be set to inherit a significant amount of property or money from his or her family. A spouse in this situation may propose the use of a prenuptial in order to preserve his or her individual ownership in said inheritance.
Debt
Some individuals choose to live beyond their means, and as a result, many Americans find themselves with a significant amount of debt. Spouses can agree to keep certain debts as separate, non-marital debt by agreeing to do so in a prenuptial agreement.
Potential for Remarrying
As more marriages have ended in divorce, more individuals are getting remarried. A prenuptial agreement helps protect individuals entering into a second (or later) marriage. These agreements help insulate spouses from contributing their assets or incomes to required payments the other spouse may have to a previous partner.
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A prenuptial agreement should no longer be considered taboo. Instead, it should be considered an important and necessary document that couples should agree to prior to marriage. The experienced family law team at the Law Office of Smith & Horwitz will help you prepare a well-planned and effective prenuptial agreement.