The fascination with celebrity breakups is never-ending, and the divorce between reality star Kim Kardashian West and music mogul Kanye West is no exception. This high-profile divorce has many speculating about the split, including the financial aspect, after both celebrities reached billionaire status this year. According to Forbes, Kim and Kanye have a prenuptial agreement that will help resolve most if not all financial matters between them, which will most likely lead to a drama-free divorce. Many high-net-worth individuals are wise enough to protect themselves against a contentious divorce by signing premarital agreements, otherwise known as a prenup. While most couples who embark on marriage may think they don’t need one, it’s important to know the basics of a prenuptial agreement before walking down the aisle.
A prenuptial agreement is a contract which two people enter before marriage that protects each spouses’ financial assets and property in the event of a legal separation or divorce. Often referred to as “marriage insurance”, a prenup assures that the division of property is predetermined to avoid litigation between the spouses. Although the notion of a prenup can be an incredibly delicate topic to approach, it is a smart, practical move intended to provide a roadmap to divorce in the event the marriage does not last. As you begin working on such an agreement, it is critical to know that:
- Both parties must be represented by independent legal counsel
- There must be full disclosure of all of the income, assets, and liabilities of each party to the agreement. Remember that the prenuptial agreement includes provisions for the division of debts, assets (real property and personal property), life insurance, spousal support, and many other financial issues.
- The agreement must be fair and does not leave either party without the means to pay their bills in the event of a divorce. The agreement must be free of duress, undue influence, or any type of threat whatsoever.
Some advantages of prenuptial agreements include being able to confront sensitive financial matters in advance of marriage. By protecting your personal and business assets before marriage, you can eliminate battles over finances and assets during divorce. Some couples also use their prenup to outline financial expectations during marriage. Because these agreements are complex documents that can have serious unforeseen complications should you divorce, it is very important to hire an experienced family law attorney to represent you in the negotiation and preparation of your agreement.
One common misconception many people have is that prenups are something only rich people have to worry about, but that’s not exactly the case. Legal experts claim that even if your assets don’t amount to much, prenups are useful, but because of their delicate nature, most couples may choose not to approach the topic. But recent reports seem to indicate that the stigma surrounding prenups is changing. The Business Insider reported that prenups are becoming increasingly popular among Americans, especially millennials. Research by the American Academy of Matrimonial Lawyers reveals that the number of millennials requesting prenuptial agreements has jumped. Two main factors motivating the uptick in prenups include millennials choosing to get married later in life, accumulating more assets and debt before marriage, and the fact that many millennials are children of divorce, making them predisposed to protect their interests.
At Schoenberg Family Law Group, we recognize that creating a prenuptial agreement can be a difficult and emotional experience for people getting ready for marriage. When negotiating a prenup, you are trying to balance the creation of a meaningful and long-lasting intimate relationship while at the same time contemplating how assets and liabilities will be divided in case of divorce. By signing a prenuptial agreement, you are not signing away your hopes for a happy marriage, but protecting your finances in case it does not work out. A prenuptial agreement may not work for you and your future spouse. You may have reservations about the process and what it means. In these cases, it is important to discuss with your partner and an experienced attorney to determine if a prenup is the best option for your specific situation.
By Debra Schoenberg