High-Risk Divorces: Why Pre-Nuptial Agreement Is Important
Prenuptial agreements are a necessity for protecting the livelihood of both spouses entering marriage, especially in cases wherein the stakes or assets are high. Even if both parties agree and get the best options, the process of divorce is still pumped up with emotions. When feelings are running high, and ex-spouses react out of anger and pain, prenuptial agreements can help dissolve assets equitably.
What is a Prenuptial Agreement?
The contract entered into by a couple before they marry, addressing the division of their assets and other financial concerns should the marriage end is what is known to be a Prenuptial Agreement. The foresight a prenuptial agreement provides can eliminate long and painful litigation if the marriage does not work out. Prenuptial agreements are private contracts drafted by attorneys, enforceable in court.
For couples who own a variety of valuable assets, the divorce process may be more complicated than usual. High asset divorce attorneys need to dig deep to determine if assets existed before the marriage or were acquired afterward. Alimony will be determined based on what each spouse contributed to the partnership. Even though one spouse may have brought in more income, the other may have contributed and supported the other by being an exceptional homemaker.
When high asset divorces involve a great deal of expensive properties, vehicles, and other assets, the costs involved in maintaining those should be considered. Spouses that lobby for vacation homes, for example, should be prepared to pay the mortgage, tax, and maintenance fees on them. Divorcing couples need to be realistic on how their lifestyle might change after their marriage ends.
The key to a satisfactory outcome in a high asset divorce is how you approach it. Acting out of anger and resentment can alienate your ex-spouse and drag the process out longer than necessary. Having a prenuptial agreement in place makes the process less complicated.
A prenuptial agreement, however, is only valid if it is completed prior to marriage. After a couple is married, they may draw up a post-nuptial agreement.
Likewise, in most jurisdictions, five elements are required for a valid prenuptial agreement. These elements include the following;
- The agreement must be in writing, verbal prenuptial agreements are generally unenforceable.
- It must be executed and entered into by both parties voluntarily.
- There must be a full and/or fair disclosure at the time of execution of said agreement.
- The prenuptial agreement cannot be unconscionable.
- It must be executed by both parties and not just their attorneys representing them, in the manner required for a deed to be recorded, known as an acknowledgment, before a notary public.
As an additional requirement, both parties should have lawyers represent them during the process of drafting the prenuptial agreement in order to ensure that the agreement is enforceable. In some cases, the parties retain a private judge to be present during the signing, to be sure that neither party has been coerced into the agreement. Some family law attorneys recommend videotaping the signing, although this is optional.