To Prenup or not to Prenup?
What is a Prenuptial Agreement & How Does It Work?
Unfortunately, the stigma typically associated with prenuptial agreements prevents a plethora of couples from discussing the significant legal benefits of premarital contracts. Many legal professionals are of the opinion that these contracts are integral to a marriage because they can address potential issues such as debts, financial planning, interfaith, disputes, and property division in the event of death or divorce.
What is a Prenuptial Agreement?
A prenuptial agreement is a legally-binding contract that is signed into effect before marriage. A prenuptial agreement typically determines how you and your partner would divide your financial responsibilities and assets (property, money, bill payments, debt, etc.) in the event of a divorce, separation, or death.
Do I need a Prenuptial Agreement?
You might be surprised to find out that despite your level of income or assets, you may need a prenuptial agreement. Many people do not consider signing a prenuptial agreement because they wrongfully presume that such agreements are only appropriate or pertinent for wealthy individuals or couples. Others fail to notice the option of executing such an agreement simply because the conversation is an unfavorable one to discuss and they do not want to risk offending their future partner. As a matter of fact, people of all income levels can benefit from a prenuptial agreement and it can be done in an amiable way with the cooperation and knowledge of both parties.
A prenuptial agreement should not be viewed as an expectancy to be divorced or separated, but merely as a means of preparing for the future and protecting both parties in a worst-case-scenario. It is no secret that the divorce rate in the U.S. is relatively high. Consequently, more couples are choosing to protect themselves with prenuptial agreements today than ever before.
On the other hand, a postnuptial agreement is done after the parties get married. A postnuptial agreement is designed to achieve the same goals as a prenuptial agreement. These goals delineate the terms of the divorce, as opposed to a judge dictating the distribution of your assets and the amount of alimony.
What Happens If You Don't Make a Prenup?
If you don't create a prenuptial agreement, your state's laws decide who owns the assets that you procure during your marriage, as well as what happens to those assets at divorce or death. State law may even have the right to determine what happens to some of the assets you owned before you were married.
Making a Valid Prenup
As divorce and remarriage have become more common, and with more equality between the sexes, courts are more inclined to uphold premarital agreements. Today, every state allows them, although a prenup that is judged unfair or otherwise fails to meet state requirements will still be cast aside.
However, because courts still look cautiously at prenups, it is important that you negotiate and write up your agreement in a way that is clear, understandable, and legally sound. It is also important to get a prenup out of the way early on in your engagement, so any contentious feelings that may arise can fade in time for you to celebrate your wedding. If you are engaged and would like to speak with someone to see if a prenuptial agreement is right for you, please call us today. Please call: (954) 361-5370 or email us at colin@colinblackwood.com.