Considering a Prenuptial Agreement? A Lesson From Kim and Kanye
As Kim Kardashian and Kanye West’s divorce continues to make news, new details have emerged about the couple’s prenuptial agreement, signed a few months before their 2014 wedding. Far from being just another piece of celebrity gossip, this latest development has some teachable lessons for any couple in 2022 thinking about putting a prenup in place.
Spelling out Separate Assets
Prenuptial agreements are a legal contract couples enter into prior to their marriage that can spell out financial and asset-related decisions the couple agree to abide by should the marriage end in divorce. Prenups generally function as a way to protect assets you acquired before the marriage, ensuring that your property is deemed exempt from equitable distribution. Prenups may also address alimony and even lifestyle issues, such as penalties for cheating and rules for what spouses can post about each other on social media.
The premarital agreement Kim and Kanye entered into in 2014 focused on their finances and assets. According to reports, the prenup delineated in clear terms that assets each brought into the marriage, and assets each created during their marriage, were to remain separate property in the event of divorce. This stringent financial dividing wall between the pair even specified that homes each owned were exempt from asset division in divorce, regardless of whether they lived in the home as a family. The only joint finances the prenup allowed was a joint checking account to pay for child-related expenses.
Kim and Kanye both entered into their marriage as multi-millionaires with established businesses and trusts overseeing much of their financial interests. Creating a prenup “firewall” between their separate ventures in many ways was a commonsense business decision. With virtually no entangled assets, the asset division portion of their divorce is more likely to proceed with few issues. Indeed, in Kanye’s public rants about the divorce, just about the only thing he doesn’t seem to have issue with is asset division.
How can a prenuptial agreement help you?
So, here is the lesson for the rest of us: If you and your spouse-to-be are entering marriage each with your own assets, It may be practical to consider establishing a prenup as a way to codify your wealth as “separate.” If you are on your second or subsequent marriage, or are older at the time of your first marriage, you may own considerable property. Having an agreement that specifies the property as yours and yours alone can help you avoid drawn out conflict the event of divorce. For example, if you own your own home, get married, and your spouse fixes things around the house or uses part of their income to redecorate and renovate, they may be able to claim part of the home as their own. A clearly worded prenup can help you protect keep your home free of division.
Likewise, if you have children from previous relationships, you can use a prenup as an addition to an estate plan to keep assets you have earmarked for your children whole and intact.
Kim and Kanye took their prenup one step further by agreeing to not only keep their premarital assets separate, but to also keep appreciation of these assets during the marriage separate as well. For some couples this may seem excessive. However, take a closer look at your situation. Do either of you run your own business? Do you have a large inheritance coming your way? Are you are an avid collector of art or antiques and want to protect your collection should your marriage end in divorce? Including terms about these types of items can give you greater peace of mind. If you’re already married, a post-nuptial agreement can address these same issues.
Kim and Kanye will probably be able to one day look back and thank themselves for their foresight. No one enters marriage hoping their prenup will ever be used. But in the event it is needed, wouldn’t it be nice to know that a well thought out and practical agreement is waiting to protect you?
Interested in establishing a prenuptial agreement before your upcoming wedding, or have questions about a prenuptial agreement that is already in place? For advice and answers to all your questions about prenuptial agreements, call us today to schedule an initial attorney consultation: 888-888-0919, or click the button below.
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