Getting a prenup before marriage is always an intelligent act, particularly for high asset individuals. Those who don’t create prenuptial agreements despite having high assets may end up in a complicated situation. Minnesota residents should understand the importance of a prenuptial agreement, particularly as seen in the stories of divorces for high earning individuals like race car driver Danica Patrick.
Danica Patrick’s divorce raises a major issue regarding the division of assets. Danica’s net worth is approximately $18 million; she is one of the highest paid race car drivers. Danica’s husband, on the other hand, earns less than 10 percent of what Danica earns. If the couple has a prenuptial agreement, asset division would take place according to their agreement. However, the absence of a prenuptial agreement could make the division of assets much more complicated.
Without a prenup, spouses in Danica’s position may have to give a major portion of their earnings to their spouses in a divorce settlement. Although the laws regarding property division are different in each state, the presence of a prenuptial agreement could make complex asset division much easier. Additionally, considering the financial profiles of Danica and her husband, it is possible that Danica may have to pay spousal support to her husband.
With a prenuptial agreement, the parties specifically state how the assets and income will be divided in the event of divorce. The agreement can also prevent properties owned prior to marriage, inherited, received as a gift or owned after the date of separation from becoming a joint property. Similarly, debts can also be kept separate.
A prenuptial agreement, if drawn properly, not only makes property distribution easier in divorce but also helps the divorcing parties to protect their assets. It helps to avoid high legal fees, stress involved in property distribution and the unpleasant battle between couples during divorce. One may decide to negotiate his or her own prenuptial agreement, but it is prudent to consult an experienced legal professional.
Source: iSports Times, “Danica Patrick Divorce: Net Worth, Assets And Alimony,” Jessica Barbanel, Nov. 21, 2012