What is a Prenuptial Agreement?
A prenuptial agreement (prenup) is a written contract between both soon-to-be spouses before they enter into marriage. The prenup typically identifies the property, assets, and/or debts each person owns before the marriage and indicates who will retain ownership of the property and any increase or decrease in value during the marriage when or if the marriage is dissolved.
A prenuptial agreement is beneficial for the following reasons:
- You can protect your property interest for inheritance purposes.
- You can clearly identify property rights, matters involving the children and payment of alimony.
- You avoid high dollar legal fees to battle the issues out in court.
While you certainly aren't entering into a marriage with plans for it to end in divorce, it's important to be able to talk to your significant other about these sensitive topics. Having that conversation now — in an open, transparent, and amicable manner guided by lawyers you both trust — can put your minds at ease as you enter into your marriage.
What is a Postnuptial Agreement?
When you marry another person, your original intent may be to share everything ... all assets and all debts. However, during the marriage, circumstances may change. Perhaps you inherit assets from a family member you want to protect for your children or you receive a large settlement you will need to support you later in life. A postnuptial agreement allows you to create a legally binding contract to identify how the assets and liabilities you currently have are to be allocated, how the assets and liabilities you may acquire will be allocated, whether one spouse will receive support, and, if so, how that is calculated and for what duration.
There are several benefits to a postnuptial agreement, including:
- Safeguarding a family business, inheritance, etc.
- Avoiding liability for a spouse’s debts
- Determining whether alimony or spousal support will be paid, how much, and for how long
- Deciding how the children will be provided for
- Avoiding expensive litigation fees and costs to battle in court.
Whether you choose a prenuptial agreement, a postnuptial agreement, or no agreement, it is important to have an open conversation with your spouse or soon to be spouse about all financial matters. A family lawyer can help protect you under stand the multitude of issues involved, outline the pros and cons, and help you weigh the risks in deciding whether an agreement is right for you. And, if you decide to enter into an agreement, a family lawyer can insure your interests and your needs are protected.
Common Misconceptions About Marital Agreements
Despite the benefits of prenuptial and postnuptial agreements, there are common misconceptions that may deter a couple from entering into an agreement. Don't let these misconceptions hinder you from exploring your legal options.
"Prenups Are Only for People Who Think They May Divorce"
Few couples ever enter into a marriage thinking that they will divorce. Fewer couples plan for a divorce. However, divorce is a reality in our world. As such, a marital agreement is a smart way to protect yourself if a divorce ever occurs.
"Prenups & Postnups Are Only for the Rich"
The purpose of a prenuptial or postnuptial agreement is not to protect the rich. Instead, an agreement helps a couple divide their financial assets, liabilities, and provide a framework to protect themselves from expensive legal fees and costs in the future.
"Prenups & Postnups Are Harmful to the Spouse with Fewer Assets"
A marriage agreement is designed to benefit both spouses — not just the wealthier spouse. The goal is for each person to come up with an equitable agreement that protect both parties and provide clarity and security during the marriage.
A prenuptial or postnuptial agreement can help you and your spouse draw clear financial boundaries, give you an opportunity to talk openly and honestly about your situation, and protect each of you if something happens down the road. Your family lawyer can help you work out the details.