PRENUP OR PAYUP
How does one take the financial risk out of marriage while maintaining a strong and loving relationship? Risk mitigation is a term most commonly used in business practices, which is also referred to as hedging your bets. For instance, when you are about to buy your forever home, you make sure that we do our due diligence before signing the purchase agreement. We hire an appraiser and an inspector to go over every nook and cranny of that property to make sure we’re making a sound investment.
Yet when we fall head over heels in love, and romance blossoms between two parties, it is as if all logic goes out the window. All we can see is that wonderful, intelligent, funny, and caring person in front of us and we tend to forget that marriage is a business partnership and contract between two parties, so why should we treat that any relationship differently than any other contract? You’re looking to make a lifelong commitment towards your spouse to be, to build a future together, and to invest in your marriage. As much as you like to think that you know everything about this person, and that you have the same ideas about your future together, statistics show a divorce rate of anywhere from 30-70% depending on numerous factors. These factors could be age difference, educational background, income, respective assets, children, ambition levels, cultural differences, financial differences, political views, socio economic background, among others.
Based on statistics marriage, unfortunately, is considered a high risk “investment”. With that in mind wouldn’t it be wise to “hedge your bet” and protect yourself and your interests against potential liability, financial exposure, and the unknown, to avoid unnecessary damages when faced with a divorce?
If both of you are young and coming into this marriage with nothing, with no preexisting assets, and with smaller income expectancies maybe a prenuptial agreement is not for you. Nevertheless, it is highly recommended in New York since New York Court favor prenuptial agreements.
You might be coming into this marriage with preexisting assets, such as a house, an inheritance, a retirement fund, and significant savings. There might be a huge disparity in income. You might have children from a previous marriage. You might own a business. You might have spent years furthering your education to become a professional, an expert in your field, with speaking engagements, and book deals. You might have to sacrifice your high paying job to take time off to become a stay at home parent to raise your children, losing out on income, savings, retirement money, promotions.
In any of the above scenarios a prenup serves an important role in the event of a divorce. Without a Prenuptial Agreement you might have to pay up, perhaps giving away huge amounts of money that was derived from appreciation in value of preexisting assets, or enhanced earnings, that you or a previous generation worked so hard to gather to provide you with financial security.
A prenup is really an excellent opportunity to sit down before tying the knot to test the strength of your relationship. It’s also an opportunity to set forth your expectations for this marital partnership and romantic union. If you can’t work out your differences and come to an agreement at this early stage of your relationship, it’s not going to be any easier 10-15 years from now.
My name is Lisa Beth Older and I’m a successful Family Law Attorney with over thirty years of experience in this field of law. I have appeared on several major news networks as a commentator on these sort of issues. If you’re contemplating marriage and believe a prenuptial agreement is something that would benefit you, please contact my office to schedule a consultation to go over your specific situation and what would be most beneficial to you.
By:
Your Manhattan Divorce and Child Custody lawyer
*This is not intneded as legal advice and is for informational purposes only.