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Alexandria, VA Estate Planning Blog

Monday, March 12, 2012

Reasons for a Pre-Marital Agreement; Asset Protection

There are many reasons why soon-to-be married couples should consider entering into a Pre-Marital Agreement. Most people who enter into a Pre-Marital Agreement do so with the primary concern of Asset Protection.  

It’s important to recognize that a Pre-Marital Agreement is an estate planning device. Because each person is unique, their Pre-Marital Agreement should contain unique asset protection provisions narrowly tailored to their finances, expectations, desires, concerns and family dynamics. However there are common or typical asset protection reasons for entering into a Pre-Marital Agreement.

Asset protection driven Pre-Marital Agreements are generally drafted for the following Asset Protection Reasons:

  • insulate and protect significant assets acquired before the marriage,
  • insulate and protect the growth of separate assets during the marriage
  • protect separate assets from being transmuted into marital property during the marriage,   
  • protect a business,
  • protect the inheritance of children born from a prior relationship or marriage (blended family),
  • establish what assets are to be separate property and what assets are to be marital property,
  • protect retirement benefits from the claims of a divorcing spouse,
  • eliminate or fix surviving spouse’s survivorship or inheritance rights (e.g., elective share); and
  • minimize or eliminate potential tax liabilities (e.g. estate tax & income tax);

 

 Entering into a Pre-Marital Agreement makes sense for asset protection purposes. It also makes sense for additional reasons not related to asset protection. Ultimately, it’s a big decision to enter into a Pre-Marital Agreement prior to marriage.

The process of negotiation and presentation to the other spouse needs to be thoughtfully and artfully conducted. Otherwise, you may risk unnecessarily hurting feelings and causing serious issues before the marriage. It’s important to select a competent attorney who is willing to thoughtfully allocate the necessary time and take the necessary action to address your asset protection issues.

If you have any questions about Pre-Marital Agreements and asset protection, feel welcome to contact the law firm.

Sincerely,

Luke Lenzi, Esq.       


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The Lenzi Law Firm, PLLC assists clients throughout Northern Virginia and Washington D.C. including Fort Washington, Falls Church, Ft. Myer, Vienna, Rosslyn, Springfield, Mount Vernon, Annandale, Fort Belvoir, Fairfax, Dunn Loring, Merrifield, McLean, Oakton, Reston, Burke, Great Falls, Fredericksburg, Stafford and Herndon in Arlington County, Alexandria County, & Fairfax County.



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