Do you need a Prenuptial Agreement? What does a premarital agreement do and how can it protect you and your assets in the event of a divorce? These are important questions every soon to be newly wed should ask themselves prior to tying the knot. Marriage is a big step, and North Carolina Divorce Law imposes a great many potential burdens on couples that divorce, so it is imperative to consider what you can do to protect yourself, your assets, and your financial future if the unthinkable happens and you find yourself facing a divorce. A prenuptial agreement is a contract that couples planning marriage may enter that resolves many of the disputes that may arise in the event of a divorce. Issues such as property ownership, property division, income sharing and classification, future alimony, and many other issues can be settled in a premarital agreement.
Asking your fiance to sign a premarital agreement is not something anyone wants to do. It is one of those unpleasant things in life that many people should do but avoid it just to save some discomfort or embarrassment. Many of those same people wind up kicking themselves a few years later when they opted to spare the feelings of someone they cared about, and that same someone is in the process of taking them to the cleaners in a divorce. How do you know if you REALLY need to protect yourself? Consider the following FIVE SIGNS THAT YOU NEED A PRENUPTIAL AGREEMENT.
- High Income. Individuals that make significantly more than there spouse during the course of the marriage may be required to pay support to their estranged spouse under North Carolina Alimony Law. As any North Carolina Divorce Lawyer can tell you, alimony can be a financially ruinous consequence of divorce. Whether or not you would have to pay alimony, how long you would have to pay it and in what amount depends on the circumstance of your marriage and separation. In general, the longer you are married, and the more you earn versus what your spouse earns, the higher your risk for significant alimony. If you are what North Carolina Divorce Law would define as the “supporting spouse”, the only absolute defense to an alimony claim would if your spouse committed adultery and it ended your marriage. Otherwise, you are facing the very real risk of supporting your spouse for a very long period of time. Alimony awards can even be “permanent”, typically meaning it would be paid into continuously until a court order is entered stopping or changing it. The good news is that a properly drafted Prenuptial Agreement can eliminate or limit your risk of paying alimony in the event of a divorce.
- Children From Prior Marriage or Relationship. If either of you have children from a prior marriage or relationship, you should consider a prenuptial agreement. Prenuptial Agreements can be drafted to preserve certain property and future income for the benefit of children that might otherwise be included or disposed of in the marital estate. In other words, you can help to ensure that children do not suffer from the divorce through having their inheritance or future support confiscated or otherwise caught up in a divorce proceeding.
- Either of You Have Significant Assets. If your or your seen to be new spouse have substantial assets going into a marriage, it is wise to consider entering into a prenuptial agreement to ensure that those assets and the income derived from those assets remain separate from the marital estate. While North Carolina’s Equitable Distribution law does recognize that premarital assets are “separate” in most cases, it is very easy to “commingle” these assets or the income derived there from which could allow a judge to include them in the marital estate and divide it. Additionally, other factors can complicate whether or not you can maintain the separate status of your premarital assets as well the longer you are married and the more things change, the higher the likelihood the separate asset can change in its nature. A properly drafted Prenuptial Agreement can help ensure what was yours before you got married remains that way in the event of a divorce.
- Your Spouse Has Significant Debt. If your soon to be new spouse owes a lot of money, or they have not shared their financial position with you, you need to consider consult a local divorce attorney before you get married. While it is true that separate debt existing before your marriage would normally remain separate after your marriage, problems often arise as the parties shift resources around. Paying off your spouse’s student loans with an equity line or a loan from your retirement may make perfect financial sense, however it can cause your finances to suffer greatly in the event of a divorce and leave you feeling cheated. Clarifying the existence, nature, and future responsibilities of debt in a Premarital Agreement is a great way to protect yourself.
- Strong Willed Spouse. It’s easy to fall in love with a strong willed person, but it can very hard to fight with them. If your soon to be spouse is stubborn, vengeful, or difficult, strongly consider handling these touchy financial issues in a prenuptial agreement. Consider how your new love has treated exes in previous relationships or marriages? Be honest with yourself. Plan for the worst case scenario and seek a prenuptial agreement., If you can see yourself spending your married years trying to avoid your beloved’s bad side, you know you are going to have it difficult in the event of a divorce. Trust your instincts and have a premarital agreement drafted.In my fourteen years as a Raleigh Divorce Lawyer, I have handled hundreds if not thousands of cases where one spouse or the other would have benefited greatly from a prenuptial agreement. If you have something to lose in the event of a divorce, act to protect yourself before it is too late.
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