Our clients ask many questions about prenuptial agreements and whether they make sense in their particular circumstances. The topic can be sensitive, because each person has their own preconceived notions about prenups, and the concept brings up negative connotations for many people.
To provide some guidance, we’ve compiled a list of frequently asked questions about prenuptial agreements. Although this is not an exhaustive list, we hope these questions will serve as a starting point for anyone in New York who is considering a prenup.
1. Why would someone want a prenuptial agreement?
The main reason people want prenuptial agreements is to provide them with financial security, regardless of whether they are the partner entering the marriage with greater or fewer assets than the other. The partner with more pre-marital property usually wants to protect that property and avoid or limit the amount they would have to pay for spousal support should the marriage end.
The partner with fewer pre-marital assets typically wants to ensure that the pool of “marital assets” will grow during the marriage and will be equally divided should the marriage end. They generally also want to know that they will be able to seek spousal support under certain circumstances.
Most clients tell us they don’t want a court battle if they end up divorcing. Some clients have bad memories of their parents’ divorce where they saw huge fights about finances or severe inequalities in their parents’ post-divorce lifestyles. These clients don’t want that experience for themselves or their own children. A prenuptial agreement allows the couple to discuss what feels equitable to them going into the marriage and will limit issues of contention if the marriage should end.
2. Do you need a prenup even if you’re not “rich?”
Even if you don’t have money to burn now, have you considered that you could become wealthy in the future? If there is a large difference in your and your spouse’s earning potential, then you could end up paying much more in spousal support than you might feel is fair.
It’s better to discuss these issues now so you and your spouse can make appropriate career decisions during the marriage that reflect your agreement should the marriage end. I’ve known many clients who say they never would have given up their careers to be stay-at-home parents if they had known how little support they would be entitled to.
In addition to establishing expectations regarding spousal support, a prenup can also limit the chance that you will end up in litigation as a result of your divorce. Litigated divorces cost a lot of money—tens of thousands or even hundreds of thousands of dollars. For the wealthiest couples, it’s not uncommon to see millions of dollars spent on litigation. If you become financially successful during your marriage, you could end up spending a good chunk of your assets fighting unnecessarily in court.
3. Is there any reason you should NOT get a prenup?
Individuals have different concepts about and views on prenuptial agreements. I recently had a client spend months negotiating a prenuptial agreement with her fiancé. In the end, she decided not to pursue the agreement because of her fiancé’s extreme negative reaction.
Despite being financially secure in his own right, my client’s fiancé felt disrespected by my client’s desire for a prenup to protect her assets. My client decided a prenup wasn’t worth the emotional strain it would cause to their relationship. Instead, we had an in-depth discussion about what she should and shouldn’t do with her assets during the marriage to ensure that they were protected in the event of a divorce.
Contact Us to Receive Our Prenuptial Agreement Checklist or to Schedule Your Initial Consultation
Deciding on whether a prenuptial agreement is right for your situation can be a sensitive topic for many couples, especially when they are preparing to start their married future together. If you have additional questions about prenuptial agreements, we would be happy to talk to you. Just give us a call at 212-768-1115 or complete the form below.