Every Business-Owning Bride Should Consider A Prenup
Being a bride is one of the most exciting times in a woman’s life. Today’s brides are more independent and more career-minded than their mothers and grandmothers before them. In fact, according to USA Today, the number of female Fortune 500 CEOs is at an all-time high. For these reasons, the stresses of wedding planning present an added dimension: should business-owning brides consider a prenuptial agreement?
Give yourself enough time to prepare and negotiate a prenuptial agreement. At least six months before the big day, and perhaps before discussing it with your fiancé, you should consult with an attorney to understand your legal rights and remedies in the event of divorce and determine what type of prenuptial agreement is right for you. It is important to speak with an attorney from the state in which you reside, as the laws of each state may vary regarding these issues. Premarital assets, including a bride’s business, do not become part of the marital pot. However, in most cases the increase in value of the bride’s business that accumulates through the duration of the marriage is subject to be divided as marital property for the purposes of equitable distribution. For this reason it makes sense for business owning brides to consider a business appraisal to understand what the business is worth, that way you will be able to determine whether to exclude the business from the marital plot.
Prenuptial agreements can be an uncomfortable topic of discussion with a soon-to-be spouse and may create a preconceived notion that one party thinks the marriage will fail. However, consider the statistics that the rate of divorce is at 50 percent for first marriages, 67 percent for second marriages, and 74 percent for third marriages. The truth is a prenup is a pertinent and financially responsible topic to consider and discuss for any bride. There are positive aspects to consider including communicating about finances and expectations related to finances, which can be key to any healthy relationship. Marriage is a long-term partnership and, like any business, may dissolve at some point. The best way to insure against a contentious divorce is to have the bride and groom determine at the outset how they want to dissolve their partnership if it does not work out.
By Randi L. Rubin, Esquire and David J. Steerman, Esquire of Klehr Harrison Harvey Branzburg LLP.
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