by Tina Seymour Demoran
Last Thursday, I returned from the 4th of July holiday to find ten messages from potential new clients on my voicemail…wanting to talk to me about representing them for divorce.
When both the wife and husband use the words, “Whatever it takes. Just get our paperwork together, as soon as you possibly can,” you know they aren’t kidding.
Most of the paperwork is pretty standard, but the one document that takes the most time in every divorce is the property settlement agreement.
Who gets what? What is a personal asset….what is a marital asset? How is it going to be split in a divorce? Then there are what I call the “gray areas” of a person’s assets: the inherited items that you didn’t take steps to protect when you inherited them from a friend or family member.
The large sum of money you inherited from your grandmother that you put into an account owned by both spouses. Yeah, well. That money now belongs to BOTH of you.
The house you inherited from your parents that you and your spouse have been living in for a while. Guess what? That’s a marital asset, in many cases.
The business that your dad started from the ground up…and he handed you the keys to the day he retired…the same business in which your spouse assisted over the years by doing paperwork, working with customers, or doing payroll.
Guess how the court will most likely view that particular asset?
That antique car that your rich uncle left to you in his will…that you have driven for over a decade and love dang near more than your own kids? Yeah…it can be lumped in the marital pile, as well, in certain circumstances.
Your spouse could be driving off into the sunset with it…and the judge may be the person who hands him or her the keys.
The above listed assets…and so many more…create situations where you really need to have in place a document outlining how assets will be treated in the event of a divorce or in drafting a property settlement agreement.
But let the D word come into the conversation…and things can change…in a heartbeat. Call me an old blue-jean -wearing skeptic…but verbal promises need to be restricted to little things.
Like where to eat dinner that night. Which movie to rent on Netflix. Where you’re going on vacation this summer.
Not assets. Not your inheritance. Not your bank accounts. Not the product of years of your own blood, sweat, and tears.
Therefore, I think in terms of WRITTEN agreements when my clients ask how to protect those assets.
Several newly engaged couples want to come in to show off the engagement ring to my staff…and my first question is: when do they want to set up an appointment to talk with me about a prenuptial agreement?
Unromantic? Am I implying or suggesting there may be a breakup in the future? Nope, Nope.
Am I advising them to protect their assets and their future inheritances, businesses and life’s work? YES
Is a prenup agreement, in the middle of all the congratulations, roses, diamond rings, and wedding plans a bad idea….or is it smart? Smart. Every. Dang. Time.
If this is your second time around the block, you and I both know that the property settlement/support agreement was probably the biggest point of contention in your divorce (other than the child custody provisions).
With a prenuptial agreement, you can set out what will be considered a marital asset in the event of divorce, death, and other circumstances.
OR, if you’re already married and know you’re inheriting a large asset, you can draft a postnup agreement protecting that asset.
When you inherit your parents’ house, the postnuptial agreement can help protect that real property from becoming a marital asset if you and your spouse decide to move into the home.
Or anything you inherit as the years progress, before I sign off, let me state this one thing that every newly engaged couple should consider before saying “I do”…
If your spouse balks at protecting your and their assets before you get married…if they refuse to even talk about a prenuptial agreement…RUN…don’t walk from that marriage.
To me, that’s a big red flag.
However, even with an initial “balking,” most couples can hammer out an acceptable agreement in my office.
Heck, sometimes it turns into an enlightening and somewhat humorous experience for both of them.
I’ve written numerous prenuptial agreements since I hung my shingle, and you’d be amazed how many marital issues were worked out in my office during the drafting consultations with the engaged couples.
Communication is key.
Knowing what your spouse expects, upfront, is key.
Letting them know what you expect, up front, is key.
Finding out how you handle the money conversation before you get married will give you some serious insight into how you, as a married couple, will handle money issues later on down the road.
So….to all of those individuals who are showing off a diamond ring or getting ready to pop the question…consider this:
If you’re willing to drop a month’s salary on the ring…why not spend just a percentage of that amount to protect your financial future?