Who had a prenup when they married, Britney Spears or Paul McCartney? Score one if you chose the blonde bubblehead over the savvy billionaire Brit. Paul McCartney lost $50 million to his ex-wife Heather Mills in their March 2008 divorce court battle. But Britney’s preplanning paid off: she paid just $300,000 to shed Kevin, leaving her with hundreds of millions to party with.
Prenups aren’t only for the rich and famous. There is an increase in prenups initiated by female business owners and professionals with high-paying jobs.
Prenups can help ease the financial tensions associated with any marriage, no matter what the size of the bank accounts involved. It’s a good idea to exchange personal financial statements anyway, so there aren’t any surprises.
Prenuptial agreements outline the division of assets and financial responsibilities in the event of divorce, separation or death of either spouse. And they don’t have to be executed before the marriage, either. When The Donald divorced Ivana (or was it the other way around?) they had already executed three post-nuptial agreements during their tumultuous marriage.
Consider a prenup if one of you owns a business, or one of you has more wealth than the other. If you have children by prior relationships, a prenup should define inheritance rights for your patchwork family. Even if your marriage lasts until death do you part, it will keep the children from squabbling about the assets you leave behind.
A pre-nup or post-nup can be used for a specific purpose. It can provide for compensation to the partner who put the other through school or who abandoned their career to raise the children. It is rumored that Jane Fonda received $6 million when she married Ted Turner and gave up her career as an actress and fitness guru.
A prenup will set you back a few thousand dollars for attorneys for each of you. Typically one lawyer writes the contract, and the other lawyer reviews it and suggests changes. Execute the agreement several months before the marriage, since an agreement signed on the eve of the wedding may be overturned if challenged in court.
Money disputes between newlyweds are increasingly problematic, so set romance aside for a few hours while you and your future spouse discuss tough financial questions and put your agreement in writing when you are entering your marriage and still communicating lovingly. After all, you aren’t just uniting your lives emotionally: you are also combining estates. You don’t want to destroy a family business or personal relationships over a failure to plan.