You know after marriage many of your assets will be shared with your spouse. For many people, there’s nothing wrong with this. However, what some people overlook is that without a plan many of their assets may be lost in a divorce.
It’s important to have a protection plan when it comes to your assets, especially if there’s a chance you might lose something important or valuable in a divorce. In response, many people create prenuptial agreements. A prenup is an asset protection plan to ensure assets are distributed to their due place in the event of a divorce. Here’s what you should know:
Making an asset protection plan before marriage
A prenup can help detail who is supposed to own what assets which are owned prior to marriage or acquired afterward. Not only can this speed up the division process in a divorce but it can also establish what assets are expected to return to their owner.
Yet, people may also include alimony/spousal support in a prenup. Alimony/spousal support is financial support given from one spouse to the other after divorce to ensure they continue their standard of living. Depending on the length of marriage, alimony/spousal support may be given only for a portion of the length of a marriage.
Protecting your assets after marriage
It should be clarified that a prenup is made only before marriage and can’t be made after a legal union. As a result, many people who delay creating a prenup or don’t know they have this option fear they won’t have a way to protect their assets. However, there is still one other way to do this. Couples may create a postnuptial agreement that stands to do everything that a prenup does but it’s made after marriage and can also be used to amend a prenup. There are more stringent requirements in entering into a post-nuptial agreement than a prenup due the to the fiduciary relationship which is created upon marriage.
If you’re looking to protect your assets, then you may need to know your legal options.