A premarital agreement, also known as a prenuptial agreement or prenup, is a written contract created by a (sometimes engaged) couple before they are set to be married. The contract typically outlines all of the property owned by each person; this can include cars, stock accounts, bank accounts, etc.. All items are specified in the written contract so that each person can determine what is to happen to that property, if the marriage were to ever end with divorce.
North Carolina has adopted the Uniform Premarital Agreement Act (UPAA). The UPAA allows parties to contract with respect to:
1. Division of Property - the division of property during marriage and upon divorce.
2. Alimony - Alimony and the waiver of alimony. Waiver of alimony agreements will be upheld unless doing so will cause the disadvantaged spouse to be eligible for public assistance.
3. Child Support - Child support arrangements will be upheld as long as they provide for the reasonable needs of the child(ren).
There are some people that believe the rich and famous are the only ones to create prenups BUT this is not true. Prenups are merely used to protect the assets of each individual, avoid conflict in the event of divorce, avoid your significant others debts, as well as clarify finances with your significant other. Without a prenup the property is split as martial property in a divorce judgement.
If you are thinking about creating a prenup with you and your significant other we can help to draft the document for you. Keep in mind that an attorney is not needed to create a valid pre-marital agreement. Failing to hire a family law attorney may, however, affect whether the agreement is fair, valid, and enforceable.
Adkins Law is able to provide you with advice and assistance with the creation of a valid premarital agreement. Contact us to schedule a consultation with an experienced family law attorney.
Control distribution of assets – You wouldn’t hand over your car keys to a child who has not had proper preparation driving, and chances are you would not want to hand over all your assets to a teenager either. But if both parents die at the same time, or while their children are still minors, the children would inherit all the assets upon their 18th birthdays. A trust allows you to specify how and when you want your children to inherit.
Protect assets from creditors – Placing an inheritance in a trust ensures that those assets are protected from your heir’s, or their spouse’s, creditors. A properly drafted trust can protect all your assets throughout your beneficiary’s lifetime from divorce, liability, lawsuits, and other judgments.
Protect inheritance from spendthrift heirs – Not everyone is good with money. If your heirs fall into that category, you can use a trust to ensure the assets are not frittered away due to spendthrift behavior.
Provide for children of prior marriage or relationship – You can use a trust to both provide for your current spouse and any children from a previous relationship. By doing so, you can prevent pain, confusion, and arguing, which may exist in blended family situations.
Provide for a special needs heir – Leaving assets outright to an heir with special needs could disqualify them from receiving important government benefits. Leaving those assets in trust bypasses this potential risk.
Avoid probate – Assets can pass to heirs without going through probate by using a trust, saving beneficiaries the time and expense of the probate process. Probate is an expensive, public, and unnecessary court process you can keep your family from having to deal with.
Protect privacy – Once a will is entered into probate, it becomes public record, and anyone may access information on what someone inherited. A trust, on the other hand, is a private document that protects your family’s privacy.
If you need to arrange a consultation with an estate planning attorney,contact Adkins Law or call (704) 274-5677.
Trusts are only for people with a high net worth!
Trusts can be set up to serve a variety of purposes and aren't only for "rich people". The most common type of trust is a living or revocable trust. A revocable trust is set up so that it can be modified during ones lifetime.
Trusts are Expensive to Setup!
Each state and attorney has its own prices when it comes to trusts. Contact attorneys in your area to get an idea of the cost. Generally attorneys have packages that include more than just a trust. Adkins Law specializes in Estate Planning and would be happy to help you!
You no longer in control of assets held in a trust!
With a revocable or living trust, you maintain complete control over all assets in the trust during your lifetime. Keep in mind, like most estate planning issues, credit protections vary and you should always work with an estate planning attorney to understand all your options.
Trusts are only for cash or financial securities!
Trusts can be set up to hold a variety of assets:
-Privately held interests in a business
Just to name a few!
The primary benefit of putting an asset in a revocable trust is to ensure the assets are distributed according to your wishes.
After I set up a trust, my assets will automatically flow as planned!
This may be true in some instances, however, this is not automatic and you must be careful not to contradict the terms of the trust. Once the trust is set up, retitle assets in the name of the trust.
I don't need a trust if I have a will!
Having a will in place is a great first step into estate planning. But, having a will does not mean your assets are completely secure. Wills can be contested, there is no guarantee that what you want to happen actually will happen if it is just outlined in your will.
It is generally a good idea to name a family member or friend as a trustee!
People often name relatives or family members as their executor of their estate and trustees on a trust. Sometimes this can create a strain on your family dynamics. Acting as trustee and/or executor or a trust and estate can be a large amount of work. You can always consider appointing an third party or corporate trustee to manage the assets and execute the wishes of your trust. My doing this it may alleviate the burden of appointing a family member and instead help in assigning a "neutral" party to act as trustee.
Trusts can be set up to benefit a charity, business organization, or even a pet.
Sometimes it is possible to assign percentages of your trust assets to a organization or charity of your choice. It is recommended you work with an attorney who may be able to assist in establishing the kind of trust that best fits to your needs for your family, maybe even your pets.
Trusts can be powerful and can accomplish a wide range of goals. They can be very difficult and sometimes hard to understand, That is why Adkins Law is here for you! We specialize in Estate Planning and we can work with your family in creating and drafting the Trust Document or Estate Package that best fits your needs for your family. Give our office a call to set up your FREE consultation.
Estate Planning is one of the most important yet neglected aspects of personal finance. When dealing with our own mortality, people tend to procrastinate. It isn't very pleasant to think about death and what will happen to our family and our finances after we pass away. Having a basic estate plan, at the minimum, is essential to ensuring that your family is cared for after you are no longer here and your finances are distributed in the way that you desire. This plays a significant role in reducing stress and frustration for your loved ones in the event of your incapacitation or death.
Below are 4 reasons Estate Planning is so important:
1) Prevents your assets from going to Unintended Beneficiaries
A main component in estate planning is designating places for your assets. This can be your home or your stocks. Without an estate plan, the courts will decide who gets your assets. This is a process that can take years and can get ugly without a clear plan.
2) Protects your Family and Your Children
In order to ensure that your children are taken care of, after your passing. You will want to name their guardians in the event that both parents die before the children turn 18. Without this the courts can step in and make the decision for you. This could potentially determine who raises your child up until they turn 18 years old.
3) Stops your Family from having to Overpay in taxes
Estate planning can reduce all of the federal and state estate taxes or the state inheritance tax. Without a plan this can be very costly to your loved ones if you were to pass.
4) Eliminates the mess when you pass
By creating a plan this enables you and gives you the opportunity to make a plan for your finances and assets after your passing. By planning in advance it ensures that you have made the right financial decisions for you and your family.
If you need to make a plan to protect your family. Adkins Law located in Huntersville, NC can help you. Call today to set up your FREE Estate Planning consultation.