Some couples bring a lot of assets into their marriage. Some Texas residents may have family wealth, businesses, retirement accounts, trust funds or other investments that increase their wealth significantly prior to the marriage. People may also have family heirlooms, jewelry or art that they want to ensure stays in their family for the foreseeable future.
When people get married they risk mixing these assets with their spouse. In many cases, people are alright in allowing their spouse to enjoy the wealth and assets that they have accumulated. However, when it comes to divorce, people often aren’t as willing to share.
A high asset divorce can be filled with strife if the couple has not already agreed on how to divide the numerous assets they have. In order to help solve this problem, people — in all income brackets — should consider negotiating a prenuptial agreement prior to their marriage.
A prenuptial agreement is an agreement between the parties that defines how property should be split should the couple divorce. In a prenuptial agreement the parties can agree to how retirement accounts, trust funds and other assets should be split. The couple can also agree to other financial issues including whether either spouse should be entitled to spousal support — and if so, how much — following the break up. These agreements can also help to protect family businesses from ex-spouses by ensuring that business assets are treated separately in a divorce.
Property division is just one issue that couples going through a high asset divorce need to address. Other issues, such as child support and child custody cannot be addressed in a prenuptial agreement and have to be dealt with at the time of the divorce. However, a prenuptial agreement can go a long way in making sure a divorce is as easy as possible.
Source: The Huffington Post, “Unpacking Prenuptial Agreements,” Caroline Choi, Jan. 31, 2014