While you may be hesitant to think about divorce before getting married, that is the ideal time to do so. It might be the only opportunity you have to protect your personal assets.
A prenuptial agreement is an excellent tool for designating which assets you want to keep separate from marital property. Once you get married, maintaining individual assets can be challenging. If you find yourself in the following situations, a prenuptial agreement might be beneficial.
You own a business
Operating a business takes a lot of dedication and money. If you started your business before getting married, and you intend to continue running the business, consider these scenarios:
- Do you want your new spouse to have partial ownership of the company?
- If you die, do you want your spouse to obtain the business, or should it belong to other partners or family members?
- Do you want your spouse to receive financial support based on the business’s profits or future earning capabilities if you divorce?
If you answer no to these questions, a prenuptial agreement can prevent these situations.
You have children from a previous marriage
When you have children and remarry, you have two families to provide for. A prenuptial agreement allows parents to delegate life insurance settlements and disburse assets to their children despite marital property laws granting assets to the new spouse.
Without prenuptial agreements, property may transfer to the new spouse, who can then gift or award the assets to anyone. If this happens, the new spouse can prevent the children from receiving any of their parent’s property.
Knowing that prenuptial agreements protect hard-earned assets should encourage more people to realize the benefits of having one.