Pre-Nups, Not Just for the Rich and Famous
A prenuptial or premarital agreement, commonly called a “prenup”, is a contract between soon-to-be spouses that can dictate how assets and spousal support are determined in the event of a divorce. Reportedly Jay-Z and singer Beyonce have a prenup that states Beyonce is paid $5 million for each child she bears and another $1 million for each year they are married. Actress Nicole Kidman is reportedly required to pay $640,000 per year in support to her signer-husband Keith Urban if they divorce unless the divorce is related to his drug use. While the prenups of the rich and famous make headlines, the reality is that premarital agreements are not just for people with substantial fame or wealth. Rather, premarital agreements can be a smart form of planning for people of all different backgrounds.
So what can a North Carolina prenuptial agreement do? In North Carolina, married persons have certain rights regarding property obtained before and during the marriage, as well as certain rights to receive financial support from the other spouse. A premarital agreement can pre-determine those marital rights, either in whole or in part.
A premarital agreement can instruct how marital assets and debts are divided if spouses eventually divorce. It also allows for one spouse to keep assets brought to the marriage or acquired during the marriage as his or her “separate property”, including any future increase in value. A premarital agreement can specify what spousal support if any, a spouse may owe to the other in the case of divorce. Spousal support can be completely waived, or the agreement can set a specific dollar amount and length of time that financial support is to be paid.
Although no one wants to plan for the end of their marriage before it starts, a premarital agreement is a device that can avoid future fights and legal battles if and when the marriage does end.