Home » Resources
The
Many Facets of a Prenuptial Agreement
Is a
Prenup for You?
Karen
Nesbitt
For many
people, a prenuptial agreement - a contract signed by a couple
prior to marriage that outlines who gets what and who pays whom in
the event of divorce - carries derogatory overtones that dampen the
romantic spirit of a wedding. After all, a bride and groom's union
is supposed to be welcomed with the romantic hope for a long and
blissful marriage, not with a business deal that prepares for
failure.
But what
many don't consider is that marriage, in and of itself, is a
contract between two people in the eyes of their state. Certainly,
couples who partake in a prenuptial agreement aren't any less
hopeful about the success of their marriage than those who don't.
But they choose to not leave a possible dissolution of marriage in
the hands of government's divorce laws, opting instead to tailor
their personal plan according to their preferences.
A
prenuptial agreement can reasonably be thought of as an insurance
policy. And, it can also be used to plan for the death of a spouse,
by stipulating the responsibility of both parties to either secure a
will or else surrender their property rights.
So, how
do you know if a prenup is a good idea for you?
Consider
these scenarios:
You
are wealthier than your partner and don't want to worry that they
are marrying you for your money.
You
bring home more money than your fiancé and would like to
regulate any potential alimony payments.
You
plan to have children and want to designate payment of child
support, medical insurance, and education.
You
are remarrying and ...
- have children from a previous
marriage who you want to ensure get their fair share of your
property.
- are obligated to support members of
your former family unit.
- own significant assets and want to
ensure that, upon your passing, they are divided evenly among your
former and current family units.
Your
partner has debts that you don't want to be responsible for, if the
two of you split.
You
own part of a business and want to protect your share.
You
want to preserve your estate plan by clearly defining the division
of property such as heirlooms or a business, in the event of
divorce.
You
want to retain separate finances.
Other,
less obvious considerations include how to file your taxes (jointly
or separately); who will pay the bills and in what manner; the
handling of any joint bank accounts; financial commitments to help
each other finish college; and the way in which each spouse will be
provided for upon the other's death (estate plan, life insurance,
etc.).
Educating
yourself about the divorce laws in your state can help you decide if
you want or need to pursue a prenuptial agreement. Several sources of
this information exist, such as:
State
laws also vary regarding how to draft a prenup and a state's
enforcement of it. State-specific forms can be downloaded from one of
the many convenient, money-saving web sites that let you avoid
attorney fees as well become educated about prenuptial agreements and
the procedure to follow. These sites include:
Keep in
mind, also, that a couple can specify that the law of the state in
which they marry will govern the interpretation of the prenup and the
division of assets. In the absence of this specification, the law of
the state in which the divorce takes place will take jurisdiction.
A
prenuptial agreement is recognized in all 50 states. Five
requirements must be met in order for it to be considered valid.
The
prenuptial must be written versus oral.
It
must be executed voluntarily.
There
must be full and/or fair disclosure at the time of execution.
The
agreement cannot be unconscionable.
It
must be acknowledged and executed by both parties, with a notary
present.
An
alternative to a prenuptial agreement is premarital mediation, during
which a couple discusses and decides upon a bevy of marital issues in
front of a mediator, who then draws up a deal memorandum or
premarital agreement. Before commissioning an attorney to draft a
prenuptial agreement, a premarital mediation should be considered. It
is typically less expensive, in that it requires less of your
attorney's time.
By law,
a prenuptial agreement that is signed after the wedding day is void,
so plan wisely. Postnuptial agreements are for couples who decide to
sign a contract after they are married.
References
and Resources
http://en.wikipedia.org/wiki/Prenuptial_agreement
www.nolo.com/resource.cfm/catID/BD0FF030-3064-4680-B419B66BA296767C/118/304/247
www.prenuptialagreements.org
www.legalmatch.com/law-library/article/prenuptial-agreements-and-children.html
|
