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Dec 4, 2017

Married? This is for you…

We start the conversation looking like this…

“Oooooh sweetie, it’s so nice to be hanging out with you in this field. Enjoying this gentle breeze and escape from our busy lives. We have great kids, you are an incredible mom and wife.” 

We end the conversation like this…

“Oh by the way, would you mind signing this postnuptial agreement?”
I know. Cringe-worthy. But hang on a minute because this is not what you think.

A postnuptial agreement can be used as an asset protection tool. Have you heard of community property? You would probably say that this means that in a state with community property laws (think California), the marital assets are divided 50/50 in a divorce. You would be correct.

But community property also means that in the event of a liability to one spouse, ALL of the marital or “community” assets are considered to be in one big bucket. Think about it this way:

You own a business and are at work on a Tuesday and in meetings all day. While you are negotiating a contract in your fourth meeting of the day, your spouse is changing lanes on the freeway and doesn’t see the motorcycle and hits the rider.

What do you think is going to happen? 

Your right, your spouse gets sued and it leads to a judgement and your spouse gets attacked. Guess what the creditor can attack? All of the marital assets including your business!

How could you be at work while your spouse crashes the car and your business gets attacked? This is community property. This is also where a division of assets using a postnuptial agreement can be an effective tool to protect assets like a business.

I asked my colleague Brent Honea, an estate and asset protection attorney, to break down what the postnup is all about. Take a few minutes to listen to our brand new video on the postnup. It’s an easy listen…

I’ll end with this. Sixty percent of Americans, that’s a 6 and a zero,  do NOThave a basic will & trust. And of the rest who do, much of that is outdated. Also, many existing estate plans don’t incorporate asset protection provisions and this is a mistake. Then life throws a curve ball and people and businesses get hurt.

Whether you are younger or older, an owner or executive, married or single – make sure your planning is updated and organized. Laws have changed and I bet your life has changed too.
For some really great free resources don’t hesitate to click below.
Thanks,
Paul Hitchcock
Director of Business Development
BarthCalderon, LLP
714-704-2828
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