Financial Issues for Second Marriages Discussed by Newsday's Peter King

Posted on July 25, 2010 by David A. Gabay

Peter King had an article in Saturday’s Newsday discussing the topic of financial planning for second marriages. King interviewed Islandia financial adviser Michael Kresh, who provided a good deal of detailed information about the types of financial issues faced by older couples getting married for the second time.

Kresh’s suggestions for handling pension beneficiary designations, reviewing and updating wills, and handling the use or sale of multiple homes are all ones I provide to my clients.

The one issue I wish King would have explored in his article, though, is how and why couples should discuss a prenuptial agreement. A prenuptial agreement can properly and effectively address property division, pension benefits, real estate division, and some estate planning matters. Other estate planning issues should be dealt with through revisions to your will and other estate planning documents.

In my office, when I advise a client getting married for the second (or third) time concerning a prenuptial agreement, I always try and work closely with his or her financial planner, accountant, and estate planning attorney.

For more information about prenuptial agreements, please contact my office at David@GabayLawFirm.com

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ATHLETES AND PRENUPS: PLAN NOW OR PAY LATER

Posted on July 17, 2010 by David A. Gabay

An online item appearing on PressBoxOnline.com and written by Joseph Geier discussed the incredibly high divorce rate for wealthy professional athletes (60-80%), as well as some of the ways athletes can help themselves deal with this problem both personally and financially.

Personally, organizations such as Professional Athletes Outreach (PAO) started by Norm Evans and his wife, Bobbe, in 1971, help athletes by teaching players and coaches how to manage their marriages, money, and fame using religious principles.  Evans was an offensive tackle for 14 years, mostly for the Miami Dolphins.

Financially, prenups are a very good way for athletes to protect their finances and their families in the event of divorce. The piece quoted Raoul Felder as saying that "The percentage of pre-nups amongst athletes is appreciably lower compared with non-athletes at the same economic level." 

Now, I have no idea what actually facts, if any, Mr. Felder has in his possession to justify this claim, but the fact remains that every professional athlete earning a substantial income should have a well designed asset protection plan. Such a plan should probably include appropriate estate planning tools such as trusts, business plans (including corporations), and prenuptial agreements for married players and coaches.

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8 Good Reasons You May Need a Prenuptial Agreement

Posted on July 11, 2010 by David A. Gabay

A prenuptial agreement is an agreement between two people regarding the acquisition, division, and disposition of their property during their marriage and after the marriage ends.

A prenup can also address any number of non-financial matters, such as: division of household chores, vacation time with or without your spouse, the location or relocation of the marital home, and the physical appearance of your spouse.

Prenups are not for everyone. Some people believe they are inappropriate for personal or religious reasons, and for others they are simply unnecessary for financial reasons.

However, getting a prenuptial agreement is particularly important in these 8 cases:

1. You are much wealthier than your partner. A prenuptial agreement can ensure that

your partner is marrying you for who you are, and not for your money.

2. You earn much more than your partner. A prenuptial agreement can be used in many states to limit the amount of alimony that is payable.

3. You are remarrying. When you remarry, your legal and financial concerns are often very different than in your first marriage. You may have children from a previous marriage, support obligations, and own a home or other significant assets. A prenuptial agreement can ensure that when you pass away, your assets are distributed according to your wishes, and that neither your first family, nor your new family are cut off.

4. Your partner has a high debt load. If you are marrying someone with a significant debt load, and don’t want to be responsible for these debts if your marriage ends, then a prenuptial agreement can help ensure that this does not happen.

5. You own part of a business. Without a prenuptial agreement, when your marriage ends, your spouse could end up owning a share of your business. Your business partners may not want this to happen. A prenup can ensure that your spouse does not become an unwanted partner in your business.

6. To prevent your spouse from overturning your estate plan. A prenuptial agreement can ensure that you estate plan works, and, for instance, ensure that a specific heirloom remains in your family.

7. You are much poorer than your partner. Just as a prenuptial agreement can be used to protect a spouse who is well off, a prenup can also be used to ensure that the partner who is weaker financially is protected.

8. If you plan to quit your job to raise children. Quitting your job will negatively impact your income and your wealth. A prenuptial agreement can ensure that the financial burden of raising the children is shared fairly by both partners.

If you would like more information about prenuptial agreements, please contact my office at David@GabayLawFirm.com or call 631-467-4177

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