Prenups Are a Smart Idea

A famous billionaire couple who put money before love, this was on the headlines once Revlon chairman Ronald Perelman and actress Ellen Barkin signed a prenuptial agreement. But this paper is no longer just for the rich and famous or for people with no faith on their marriages. Recently, a prenup is already considered a part of any good asset protection plan. It is like a will or power of attorney not just a Plan B for people who aren’t sure they trust their partners.

Prenup candidates are not only the common ones like people with second marriages who have children, businesses, homes or accounts they want to protect. There are already younger people who have accumulated huge assets while waiting to get married and people whose parents have done well enough to question prenup. But a prenup can help you avoid inflicting your love ones with your debts.

And one major thing: a prenup is a guard against being in a divorce and the high divorce rate has triggered a slight increase in the prenup market. No one can actually tell how many prenups exist because there is no such office where prenups are filed. These are just contracts stating your assets and how it will be distributed if the marriage ends, signed by the couple.

But at the Equality in Marriage Institute, inquiries about prenups climbed from 1,500 a month in 2003 to 5,000 last year. Arlene Dubin, author of Prenups for Lovers, estimates that up to 10% of couples on their first marriage and 20% of couples on subsequent marriages have them. Famed matrimonial attorney Raoul Felder says, confidently, "Everyone needs a prenup."

Isn't It Romantic?

Prenups are not for everyone though it only costs $1000 and up for a prenup. However, everyone heading to the altar with big assets should at least consider it. States have rules on how assets are divided if a marriage ends. A well-written prenup allows you to make your own.

Prenups can come in just as handy in case of death as they do in a divorce. States can stipulate the minimum your spouse gets upon your death. You may not want yours to get the full allotment or you may want him or her to get more. Regardless, wills are one-sided documents that a spouse can change without the other's permission, says Dubin, who works as a matrimonial attorney in New York City.