Many couples will come to a point in their relationship when they want to get married. This is supposed to be a very exciting time, but there are also some concerns going into a marriage because you will now be legally bound to the other person. Not only will you be married, you’ll be splitting marital assets, and any money you make or assets that you purchase will now be marital property.
If you have a business, matters become even more complex as a result.
Asking your significant other to sign a prenuptial agreement can result in a lot of resentment. Oftentimes, partners make one simple argument: “if you love me, why ask me to sign a prenup?” This can be a very trying time in any relationship, and you want to reinforce the importance of a prenuptial agreement for both parties involved.
The following four reasons will help you explain the importance of this agreement:
1. Personal Liability Limitations
In the event that one spouse owns a business, there will always be the concern of personal liability. When you sign a prenuptial agreement, you will be able to isolate yourself from liability by stating that the business is the sole property of your spouse or yourself.
This can help limit your personal liability in the event that a business is sued.
2. Prevent Personal Business Liquidation
Another business benefit of this agreement is that the business that you own will not be owned within the marriage. You don’t want your spouse to be entitled to the entire business, which may cause you to have to liquidate the business upon your dissolution of marriage.
You can consider this a pre-marital asset so that you still remain owner of the business if the marriage is dissolved.
You may have to pay money during a divorce despite the agreement on income earned from the business during the marriage.
3. Limit Potential Spousal Support
Spousal support can be astronomical in price if a person is wealthy. This is why many celebrities will get a prenuptial agreement made before marriage. This helps minimize the amount of spousal support that you’ll be required to pay after divorce.
Limiting spousal support allows you to maintain your lifestyle following a divorce, and doesn’t result in a financial crisis following the divorce.
The Micklin Law Group, LLC is a New Jersey law firm specializing in family law and estates. Attorney Brad Micklin was recently named to The National Advocates list of Top 100 attorneys from each state. To set up a consultation, call 973-562-0100.