What do many people have in common with recently engaged music superstar Taylor Swift and Kansas City Chiefs football player Travis Kelce?
The answer? Prenuptial agreements! Indeed, you don’t have to be uber-rich to benefit from a prenuptial agreement.
Many clients of mine are worried or concerned about raising the idea of a prenuptial agreement with their fiancée because of the anticipated response and what it “says” about their relationship.
This is true for very wealthy clients and clients of more modest means. Whether or not a couple enters into a premarital agreement is a personal choice.
That said, I tell all of my clients that having a prenuptial agreement is like wearing your seatbelt – you hope you never need it, but you’ll be happy to have it if you do.
What is a Prenuptial Agreement?
Prenuptial agreements, also known as premarital agreements, are contracts between intended spouses designed to determine rights and obligations arising out of a marriage in the event of separation, divorce, annulment, or death.
Washington, D.C., Maryland and Virginia all recognize prenuptial agreements and courts in those jurisdictions will enforce valid prenuptial agreements. Prenuptial agreements can be invalidated if they are found to be entered into under duress or coercion. Similarly, prenuptial agreements can generally be invalidated if they are procured by fraud.
Understanding the Rising Popularity of Prenuptial Agreements
In crafting a prenuptial agreement, parties are provided the ability to be as creative and detailed as they determine. Additionally, the terms of a premarital agreement can be as unique as each individual couple. This is, perhaps, why they are becoming increasingly popular.
Another reason prenuptial agreements are more common is they can resolve all rights and obligations arising out of a marriage or can be limited to only certain claims, for example, a house or alimony/spousal support.
This can allow couples to decide how to resolve certain facets of their financial status as opposed to leaving it to the uncertainty that can come from the decision making of a judge. Stated another way, it’s a means to limit risk and protect the assets of parties.
Additionally, the number of divorce cases with women as the primary breadwinner and/or financially superior party, as with Taylor Swift and Travis Kelce, are far more frequent than just 20 years ago.
The convergence of that trend with many young people putting off marriage until they are older and more established in their careers and financial lives has led to more people, both men and women, seeking prenuptial agreements for their first marriages (whereas many would seek one for their second, third, or fourth marriages in decades past).
Why Celebrities Like Taylor Swift and Travis Kelce Almost Always Get a Prenup
In the case of Taylor Swift and Travis Kelce, the enormous wealth of these individuals certainly warrants a prenuptial agreement. The complex nature of their assets, their significant future earning potential, the presumed desire of both parties to protect their assets in the event of divorce are all significant reasons why they, and other celebrities, may consider a prenuptial agreement.
Further, celebrities like Taylor Swift and Travis Kelce probably want to limit public and costly litigation in the event of divorce and settle things before they are in conflict. This can largely be achieved by a carefully crafted prenuptial agreement. Moreover, prenuptial agreements can include a confidentiality clause which limits the parties’ ability to discuss the terms of the agreement and/or financial status of the other.
Additionally, it is common for a premarital agreement to contain a financial disclosure for each party, including income/earnings. Though Taylor Swift and Travis Kelce are among the ultra-rich, it is still important for each to be familiar with and understand the other’s financial status, including assets, liabilities and earning potential.
Similarly, a prenuptial agreement can include a list of assets that are to remain the property of one party. It can also classify how income is treated. For example, in the case of Taylor Swift, her music catalog, rights, and royalties could remain hers, and in the case of Travis Kelce, his Super Bowl rings, royalties, and sponsorships could remain his, as part of a premarital agreement.
When and Why You May Want to Consider a Prenup
Prenuptial agreements are very common and are utilized by parties in various scenarios and for all kinds of reasons.
Parties may want to protect the assets they have or will receive. Indeed, sometimes, it is the parents or family of one or both parties that insist on a premarital agreement to protect and preserve inherited and/or legacy wealth. Parties may wish to provide for children from a prior relationship in the event of a divorce. Most often, couples desire to control the outcome as much as possible in the event of divorce.
Further, a prenuptial agreement, though designed to limit rights, can provide freedom for a couple. When parties have settled their financial rights and obligations, they may not be as concerned about jointly acquiring assets such as real estate.
By way of example, if a prenuptial agreement determines what happens to a house and the down payment for a house upon divorce, parties may feel more confident in combining assets to purchase a home (or vacation home) and titling it jointly because they both feel protected.
Similarly, an economically advantaged spouse might be more willing to contribute the majority of the purchase price for an asset and still title it jointly with their spouse, even without contribution, because the rights and obligations of the parties are established in their premarital agreement. In that case, it is likely both parties feel secure in the transaction.
If you’re considering a premarital agreement, earlier is better. Parties are best served by discussing the possibility of a prenuptial agreement and its terms far in advance of their marriage date to afford them the time needed to carefully consider things, gather information, and discuss terms without the additional responsibilities the arise in the weeks before a wedding.
Discuss Your Options With A Prenuptial Agreement Attorney
Parties are not required to have attorneys represent them in negotiating, drafting, or modifying a premarital agreement. However, it is highly recommended that counsel is involved as prenuptial agreements are technical documents and the words and phrases included in the document can be just as important as the words and phrases that are excluded from the document.
Further, though an unrepresented party can enter into a prenuptial agreement prepared by an attorney representing the other party and that alone will not be grounds to invalidate the agreement, it is strongly advised that both parties to a prenuptial agreement have their own attorneys.
Finally, there is no prohibition in Virginia, Maryland, or Washington, D.C. on one party to a prenuptial agreement providing the funds to the other party so that the other party can retain an attorney to represent him or her.
If you are considering entering into a prenuptial agreement or exploring modifications to your existing prenuptial agreement, you should consult with an attorney trained in this area of law.
