When an individual is able to create a successful startup, he or she can become enormously wealthy in a very short period of time. That is also true of innovators in the field of technology, where a successful software product or phone app can change one's fortune from one day to the next. For those in New Jersey who have done well in the tech industry and are considering divorce, it is important to understand the unique challenges that might arise in a high asset divorce.
Take, for example, the recent split between Facebook and Twitter investor Mark Pincus and his wife. The couple had a prenup in place at the time of their marriage, but she is asking the court to throw it out, due to the fact that her husband's net worth has skyrocketed since their marriage. A large part of what makes a prenup work is the full disclosure of marital assets, and a mutual agreement on how those assets are to be divided during a divorce.
When an individual is in the business of creating new technologies or founding startup companies, it is very difficult to place a value on those enterprises. That means that the prenuptial agreements created at the onset of a marriage can outline terms that are inconsistent with the financial standing of the family when the time comes to call that document into action. That can lead to court challenges, and the loss of protection afforded by a prenup.
New Jersey residents who are preparing to wed should take these issues into consideration when deciding on a prenup. While it is difficult to account for future earnings, it is not impossible. For those who are already married and for whom divorce may be a possibility, working with an attorney who is familiar with high asset divorce issues can help preserve wealth.
Source: bizjournals.com, "Why Silicon Valley divorces can be especially pricey splits", Gina Hall, April 20, 2017