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Who can benefit from prenuptial agreements?

| Aug 18, 2020 | Divorce

Couples in Hawaii might mistakenly think that prenuptial agreements are something that only the wealthy need. The truth is that anyone bringing assets into a marriage can benefit from signing this type of agreement. While everyone should be an optimist about their pending marriage, they also need to consider the financial risks if the union does not succeed.

Those who may be at risk of losing assets include people who started a business before the marriage or those who plan on launching one. Even if their spouse was not a part of forming the company, the business can still become part of the marital estate if a spouse earns money from it during the union. Those who have inherited money are also vulnerable to having it divided in the case of a divorce.

Prenuptial agreements can prevent long and nasty divorces. Many couples end up fighting over money in court, but an agreement will dictate ahead of time what happens to the assets in the event of a divorce. This could keep each spouse from having to spend thousands of dollars in attorney’s fees and go through the stress of a trial. Finally, a prenuptial agreement is helpful to those getting married later in life who already have children. The document ensures that a person can leave money to their children when they die.

Prenuptial agreements are the most effective when a person has the help of a lawyer in drafting and negotiating one. During a divorce, one spouse might challenge the validity of the agreement because they want more money than they are entitled to under the terms of the contract. Like with any contract, having a lawyer draft the terms of the agreement may make it more likely that it will withstand scrutiny in a court of law.