Poor Spouses Need Prenups Too, Planner Says

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• Financial Advisor Magazine — FA-Mag.com

For every 60 minutes that a person spends making money, he or she should spend 60 seconds protecting it, says Hillel L. Presser, managing partner of The Presser Law Firm P.A. in Boca Raton, Fla.

Having said that, Presser feels it is just as important—maybe more so—for a middle-class or poor person in a relationship to be protected as it is for someone with great wealth.

A proactive approach to protecting assets can be accomplished through a traditional prenuptial agreement, but post-nuptial or co-habitation agreements are also valuable tools, Presser says.

Presser, whose firm specializes in Asset Protection, says clients should have all three documents, with a financial advisor, an attorney and a CPA involved in their creation.

“These documents are not there just to protect the rich. What if a rich man lives with a woman with few assets and they part after 10 years? She has to be treated fairly and the agreement that would guarantee that should be written when emotions are not involved,” Presser says.

In states that recognize common law marriages, a partner can claim a share of his or her partner’s assets after a certain number of years.

“If a person has $10 million and loses $5 million, he will be mad, but he will still have $5 million. If a person has $50,000 and loses it, it will be catastrophic. The less you have, the more important the assets are to you,” Presser says.

“The post-nuptial agreement is not much different from the prenup. It is just written after a couple is married. The prenup and post-nup and co-habitation agreement can deal with assets brought to the marriage and assets accumulated during the marriage.

“To be enforceable, the post-nuptial agreement, like the prenuptial agreement, requires the agreement to be fair, that both spouses fully understand the agreement, that neither party defrauds the other and that each has independent legal counsel,” he adds.

“Maybe the richer spouse promised to take care of the other no matter what happens. You need to have that in writing while there are no negative emotions involved,” Presser says.

The financial advisor can act as the quarterback, but the team should include an Asset Protection attorney, as well as an estate attorney, maybe a tax attorney, a CPA and even a property and casualty insurance specialist, he adds.

Yes, You Can Lose Everything!