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How to Know If You Need a Prenup

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Unless you have been living under a rock for the last week, you know that Rupert Murdoch is divorcing his wife, Wendi. And if you have heard any details about the split, you also know that the couple probably has a prenup.

Prenuptial agreements are common among the financial elite, like the Murdochs, for good reason: When they divorce, the settlements can be astronomical. Murdoch knows this all too well, since the cost of his divorce from his second wife, Anna, reportedly topped out at $1.7 billion.

(Read More: The World's Most Expensive Divorce Settlements)

Another divorcing mogul, Harold Hamm of Continental Resources, is rumored to have no prenup with his wife, Sue Ann, and he may spend far more to get unhitched.

(Read More: Lack of a Prenup Imperils Oil Billionaire's Fortune)

The rest of us can only daydream about sums like that. But in certain circumstances, prenups may make sense for the 99 percent.

Entrepreneurs in particular may benefit from prenuptial agreements, according to Randall Kessler, a divorce lawyer in Atlanta and the past chairman of the American Bar Association's family law section. "If you're 45 or 50 years old and you spent your whole life building something, you may think of that as your baby. People want to protect that," he said.

Kessler argues that professional athletes, or people on the verge of a large financial windfall that they have been working toward for a while, may also want prenups.

"If you're an athlete and you finally make it to the pros, now is your prime time. Your earnings are going to be in the marriage, but you have worked for this for years. You may feel like, 'why should she get 50 percent of the assets' " if the marriage ends, Kessler said.

(Read More: Top Athletes and Their Endorsements)

Often, the people seeking out prenups are people who have been burned in a previous divorce. They may want to head off a costly settlement, or protect the interests of children from a past marriage, or both. "People who have been through a bad divorce have more moral ability to negotiate," Kessler said.

Prenups have become more common over the years. The most recent survey by the American Academy of Matrimonial Lawyers, published in 2010, found that over the previous five years, 73 percent of matrimonial lawyers saw an increase in prenups.

"I think there has been a real uptick, particularly in areas like New York where you have people making a tremendous amount of money in the financial services sector, in the tech sector," said Alton Abramowitz, a divorce lawyer and president of the matrimonial lawyers' association. There are "people earning money at a young age and people in established families with long histories of family wealth."

Abramowitz estimates that his firm creates two to five prenups every month, up from two to three per year when he started in private practice in 1978.

But Abramowitz says prenups aren't really necessary for most middle class couples. If the point of an agreement is to keep the division of assets simple when a couple splits, he says the courts are already moving to make that the norm. Judges in New York already have a formula to use when setting some alimony awards, he says.

For his part, Kessler says that "if you don't have much assets, less than $100,000 or $200,000, it's probably not worth the lawyers' fees to draft" a prenup.

Then there is the general unpleasantness factor. Who wants to negotiate a breakup agreement when you are getting ready to marry? Kessler himself has no prenup. "I'm not any different than anybody else. I love my wife, I trust my wife, and I haven't been through a divorce," he said. "We knew everything about each other. I didn't want to negotiate with her."

_ By CNBC's Kelley Holland.

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