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Prenuptial Agreements

Also referred to as a premarital agreement, a prenuptial agreement is an agreement made by a couple before they are married. These agreements treat subjects such as the ownership of assets if the marriage should fail.

Wedding ring on pen, on banknotes background. Marriage of convenience

What is a Prenuptial Agreement?

A Prenuptial Agreement (also known as an “ante nuptial” agreement) is a contract between a man and a woman prior to getting married. The prenuptial agreement (or “prenup” for short)spells out each parties’ rights and obligations in the event of Divorce or Dissolution, or the death of either party.  There are specific requirements for a prenuptial agreement to be enforceable or valid.  These requirements, similarly to all others types of contracts, follow the various and relevant contract and domestic relations laws.These include, but are not necessarily limited to, the Prenup being reduced to writing and be supported by adequate “consideration,” meaning that the individuals signing the contract must obtain something in exchange for their agreement to the terms of the contract.  Both parties must also give full disclosure of financial issues by providing a detailed list of all assets and liabilities they have prior to their marriage.  This must include all values for each asset and liability.

Who Needs a Prenuptial Agreement?

Contrary to popular opinion, prenups are not just for the rich. While prenups are often used to protect the assets of a wealthy fiancé, couples of more modest means are increasingly turning to them for their own purposes. Here are some reasons that some people want a prenup:

Pass separate property to children from prior marriages. A marrying couple with children from prior marriages may use a prenup to spell out what will happen to their property when they die, so that they can pass on separate property to their children and still provide for each other, if necessary. Without a prenup, a surviving spouse might have the right to claim a large portion of the other spouse’s property, leaving much less for the kids.

Clarify financial rights. Couples with or without children, wealthy or not, may simply want to clarify their financial rights and responsibilities during marriage.

Avoid arguments in case of divorce. Or they may want to avoid potential arguments if they ever divorce, by specifying in advance how their property will be divided, and whether or not either spouse will receive alimony. (A few states won’t allow a spouse to give up the right to alimony, however, and, in most others, a waiver of alimony will be scrutinized heavily and won’t be enforced if the spouse who is giving up alimony didn’t have a lawyer.)

Avoid arguments in case of divorce. Or they may want to avoid potential arguments if they ever divorce, by specifying in advance how their property will be divided, and whether or not either spouse will receive alimony. (A few states won’t allow a spouse to give up the right to alimony, however, and, in most others, a waiver of alimony will be scrutinized heavily and won’t be enforced if the spouse who is giving up alimony didn’t have a lawyer.)

Risks of not having a Prenuptial Agreement.

If you don’t make a prenuptial agreement, your state’s laws determine who owns the property that you acquire during your marriage, as well as what happens to that property at divorce or death. Property acquired during your marriage is known as either marital or community property, depending on your state. State laws may even have a say in what happens to some of the property you owned before you were married.

Under the law, marriage is considered to be a contract between the marrying couple, and with that contract comes certain automatic property rights for each spouse. For example, in the absence of a prenup stating otherwise, a spouse usually has the right to:

  • share ownership of property acquired during marriage, with the expectation that the property will be divided between the spouses in the event of a divorce or at death
  • incur debts during marriage that the other spouse may have to pay for, and
  • share in the management and control of any marital or community property, sometimes including the right to sell it or give it away.

What does a Prenuptial Agreement Protect Against?

When properly negotiated, a prenuptial agreement can protect:

  • Any retirement or education funds an individual has accumulated prior to the marriage
  • Division of property that either individual owns at the time of marriage
  • Property that may be awarded to children from previous relationships
  • Spousal support should the marriage end in divorce
  • Decisions regarding education and religious obligations of children resulting from marriage
  • Finances of each individual
  • Obligations to pay off the debts the other party has or obtains
  • Inheritance
  • Rights of ownership in life insurance or disability policies

We're On Your Side.

If you are looking to draft a prenuptial agreement, or have questions regarding the process, our experienced lawyers are here to help.  Couples of all types of estates with all types of property can benefit from a prenup, but keep in mind, all agreements are still subject to court review.  We make every effort to prepare for all possible problems that may occur down the line to prevent an opposing party from having the prenuptial agreement overturned by the court.  To speak to a lawyer regarding a prenuptial agreement, contact Kirkland & Sommers, online or call (937) 853-5555.

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