For people who are just beginning their business journey but have already gained millionaire status, with the prospect of growing wealthier over time, there’s a need to protect themselves. Marriage being a legally binding contract, it opens up the potential for a loss of business control in a contentious and poorly managed divorce proceeding and subsequent settlement.
To reduce any ambiguity and the risk of someone secretly ‘marrying for money,’ a prenuptial agreement puts down on record what was agreed to before the marriage. This establishes the thinking at the time of the marriage, which is useful in and of itself.
Why are pre-nups vital for wealthy people?
Where Does the Money Originate?
Some men and women are independently wealthy before they marry. They may have inherited money from family or built a successful business early in life. Either way, they probably want to protect their money in the event the marriage breaks down in later years.
Divorce Proceedings? Let the Mud Slinging Begin
Divorce proceedings tend to bring out the worst in people. Dividing the assets is not romantic and when there is bad feeling on both sides, it can soon get ugly. Previously friendly communications can quickly degenerate into false accusations as a negotiating tactic to force a higher settlement.
A negotiated prenuptial agreement for high-net-worth individuals should be a priority. Whether as a businesswoman or a businessman, it’s important to preserve the business interests by avoiding a necessary breakup of the corporation. Also, it’s preferable to have any children become the eventual beneficiaries rather than someone leaving the matrimonial union. This is often best achieved by limiting the financial exposure of a potential divorce through a negotiated prenuptial agreement.
The Validity of a Negotiated Pre-Nup
As a will gladly tell you, it’s become increasingly common for people to attempt to get out of a pre-nup they signed. The most common reason cited is that they were “coerced into signing it” in an attempt to invalidate it. The situation occurs far less often when the person bootstrapped a business or was self-made. In which case, there’s far less of a wealth disparity between the divorcing couple. Yet when marriage was the main wealth creator for one of the parties, their divorce can become extremely difficult to resolve.
A good resource to find a lawyer is using a directory like lawyers.findlaw.com. However, if you are looking for Lawyer in Salt Lake City, you might want to consider Hepworth & Associates Law Firm as they have considerable experience drafting legally binding prenuptial agreements. It makes it likelier that any pre-nup will be litigation-proof and far less likely that spurious claims used as a negotiation tactic will be taken seriously.
For anyone who is already wealthy or even expects that they might become so, it’s worth getting a pre-nup before walking down the aisle. Otherwise, they’re literally putting it all on the line with a contract that has a 50/50 success rate, at best. If that were an investment, they’d surely pass. Yet marriage is a special case, so special protections are required to do it right.
