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Prenuptial Agreements in High-Net-Worth Divorces: What You Should Know?
A prenuptial agreement contains detailed information about how you want your property and assets divided in the event of a divorce. It is a common misconception that prenuptial agreements are only recommended for extremely wealthy individuals or couples with vast and complicated assets. However, while a prenuptial agreement is particularly important for marriages involving high net worth, all married couples can benefit from a prenuptial agreement. This is particularly true for couples who own their own business or have accumulated significant assets.
If you and your spouse get divorced, a range of issues will need to be resolved, including spousal support and property division. If a prenuptial agreement has been established beforehand, it will likely include detailed information about how your property and assets should be divided. It will also identify which assets should be protected from settlement negotiations.
What Issues Can a Prenuptial Agreement Address?
If you have questions or concerns about how to draft a prenuptial agreement and what issues should be addressed, it is recommended that you work with an experienced divorce lawyer. The following are examples of what can be included in a high-net-worth prenuptial agreement:
- Each spouse’s rights and obligations regarding marital and separate property.
- Each spouse’s right to purchase, sell, control, transfer, or dispose of any property.
- Details about spousal support.
- Division of assets, property, and debts in case of a divorce or if a spouse dies.
- How a business will be divided in the event of a divorce.
- Each spouse’s rights to death benefits.
What Are the Most Requested Items in a Prenuptial Agreement?
For most couples, a prenuptial agreement addresses practical items that address their current financial status and how they want their finances handled in the event of a divorce. The following are examples of some of the most common requests that couples make when drafting a prenuptial agreement:
- Real estate: If the marital home or other property was purchased before you married, it may be considered separate property unless it was commingled. Setting up a prenuptial agreement can also allow you to avoid confusion about who is entitled to the home in a divorce.
- Business interests: If you own your own business, a prenuptial agreement can allow you to specify this type of asset as separate property or include a specific percent of the business that your spouse is entitled to claim
- Retirement accounts: In New Jersey, most retirement and pension accounts are subject to equitable distribution laws, which means that the funds are distributed in a manner the court deems fair. A prenuptial agreement can allow you to include language exempting your retirement accounts from being considered marital property in divorce proceedings.
- Alimony: Addressing the details of a spousal support agreement can be easier to discuss now, as opposed to when you are in the middle of a divorce. Often, the non-monied spouse receives a lump-sum payment or equity in one or more residences.
- Bank accounts: If you have significant savings, you can specify in a prenuptial agreement that you would like this account to remain separate rather than commingling the funds.
- Credit card debt: If your spouse has accumulated significant credit card debt, your prenuptial agreement can specify that the debt should be separate and that you are not financially responsible for paying it back.
- Personal property: If you have valuable items, including antiques, artwork, or furniture, you can specify in the prenuptial agreement that you want to keep them.
- Assets set aside for children: If you have children from a previous marriage and have assets intended for your children to inherit, you can include language in the prenuptial agreement stating that this property should be kept separate.
Our Skilled Freehold Divorce Lawyers at Lyons & Associates, P.C. Assist High-Net-Worth Clients With Prenuptial Agreements
If you have questions about whether to have a prenuptial agreement in place before getting married, contact our Freehold divorce lawyers at Lyons & Associates, P.C. To schedule a free consultation, call 908-575-9777 or contact us online. Located in Somerville, Morristown, and Freehold, New Jersey, we serve clients in Somerset, Woodbridge, Morristown, Parsippany, Rockaway, Short Hills, Chatham, Randolph, Madison, Morris Plains, and Monmouth County.