What is a Prenuptial Agreement?
Prenuptial agreements (sometimes called premarital agreements, antenuptial agreements or prenups) are contracts between spouses that outline the financial plans to be followed in the event of divorce or death. Without prenups, the state decides how assets and debts are divided during a divorce.
In order for a prenup to be recognized in most state courts, it must:
- Be a written agreement: Oral agreements are not recognized in most courts. Further, the prenup will likely be dismissed if it is too informal or lacks notarization.
- Be voluntary by both parties: If a prenup shows signs that one party coerced the other into signing, the court may choose not to honor it.
- Contain full and fair disclosure: For a prenuptial agreement to be valid, it must recognize all assets of both parties. Concealing debts or assets could lead to a dismissal of the contract.
- Conscionable: A court may throw out a prenup that calls for excessive penalties or benefits to one party.
- Be carried out by both partners in front of a public notary: While lawyers can (and should) help draft prenups, the future spouses are the ones who need to sign it.
Divorce Case Review Click Here
These are the basic regulations that prenuptial agreements must follow to be recognized in courts, but each state has unique rules and specifications. For a detailed explanation of the requirements for prenups in your state, it's a good idea to contact a divorce lawyer practicing in your area.
Please note that prenuptial agreements are not always considered the "final word" in legal proceedings, but, when executed correctly, can have a significant impact on a court's ruling.
Who Can Benefit from Prenuptial Agreements?
You may be surprised to learn that prenups aren't just for the absurdly rich anymore. In fact, prenups can benefit people in a variety of circumstances, especially those who
- Have significant assets such as a home, retirement funds or stocks;
- Own a business or part of one;
- Expect to receive an inheritance;
- Have children and/or grandchildren from an earlier marriage;
- Are significantly wealthier than their fiancé(e)s;
- Plan on financing a spouse's college education;
- Must support other family members (including elderly parents);
- Are studying for a degree in a potentially high-earning field; or
- Expect a sizable income increase in the future.
In some cases, those with the biggest bank accounts aren't as concerned with losing money in divorce than those with more modest savings. Especially if you've worked hard to put away a nest egg, you may want to consider protecting that in case anything happens to you, your spouse or your marriage.
Divorce Case Review Click Here
What Can Prenups Include?
Prenuptial agreements are generally intended to outline the financial terms of a marriage (or the dissolution of that marriage). It's important to consult with a lawyer when composing your agreement, because including certain conditions in a prenup (such as who is responsible for which chores) could cause a court to view the contract as frivolous and throw it out.
Basically, prenuptial agreements can include plans for:
- Determining the division of debts and assets in the case of divorce;
- Protecting parties from certain debts;
- Maintaining separation of finances/assets;
- Managing money during a marriage (including paying bills, handling credit cards, filing taxes, etc.);
- Distributing property to children from earlier marriages (especially in the case of death); and
- Keeping certain items within a family's bloodline.
Prenups cannot legally outline any of the following:
- Child support/child custody/child visitation obligations and rights;
- Most nonfinancial matters; or
- Any matter that would violate state or federal laws.
Some prenuptial agreements include a "sunset clause," which allows the prenup to expire after a certain number of years of marriage. Because the sunset clause highlights that the prenup may not be needed, some marrying couples feel more comfortable entering a prenuptial agreement that includes such a clause.
Divorce Case Review Click Here
How Can I Create a Prenup?
Most experts recommend preparing a prenuptial agreement well in advance of the wedding. This allows both parties enough stress-free time to agree on fair terms and prevents courts from suspecting coercion. Once a couple has decided to create a prenup, the legal issues must be addressed.
Both parties must hire a marriage/divorce lawyer. That means each future spouse has a separate lawyer.
The two attorneys then work together to draft the agreement, each keeping his client's best interests in mind. Some prenups have been declared null and void by courts because one spouse did not have legal representation.
Be sure to complete and sign the prenup well before the wedding. This will not only minimize the pressure, but will also allow the marrying couple time to work out any kinks before the big day.
If you're interested in drafting a prenuptial agreement or learning more about these documents, you can find a marriage/divorce lawyer in your area by filling out our free case evaluation form or calling us at 1 (877) 349-1310.