Prenuptial Agreements 101
You’ve likely heard the term “prenup” before. This colloquialism refers to prenuptial agreements, legally binding contracts that detail how a couple’s marital and separate property should be divided in the event of a divorce. Prenuptial agreements get a bad rap for being unromantic. Because of this negative reputation, many people avoid seeking them, even when they are in their best interest. Many people are afraid to bring up prenuptial agreements with their partners because they don’t want to seem like they aren’t invested in the relationship.
Consequently, there are a lot of misconceptions and misunderstandings about prenuptial agreements. Below we go over a few frequently asked questions about prenups and dispel some common myths.
What Should Be Included in a Prenuptial Agreement?
One of the primary purposes of prenuptial agreements is to outline separate and marital property. For example, suppose one person comes into the marriage with substantial holdings. In that case, the couple may agree that those holdings and any earnings they produce during the marriage should remain separate property. However, this is not the only thing that can be included in a prenuptial agreement.
You should also consider including plans for:
- Debt division
- Spousal support
- Child support
- Child custody
- Relocation rights
Note: while you can include some aspects of child-related matters in your prenuptial agreement, there are limitations, and the courts will still need to approve and formalize child support and custody agreements in the event of a separation or divorce. The reason to include these matters in a prenuptial agreement is that, if the time comes, it can help you and your spouse during the negotiation process and help the process go more smoothly overall.
What Can’t a Prenuptial Agreement Do?
While your prenuptial agreement can include any property, assets, and debts, you cannot outline child custody and support before you have children. You can include provisions regarding preexisting children, but several child-related matters cannot be dictated in a prenup. For example, you can use a prenup to protect an inheritance for a child from a previous relationship, but you cannot use a prenup to dictate how a child will be raised. You also cannot use a prenuptial agreement to waive someone’s right to receive spousal support or alimony.
Can Prenuptial Agreements Be Modified?
Yes. Generally speaking, any terms of the agreement can be modified after the wedding has taken place, and the prenuptial agreement can even be terminated. However, you will need the consent of both parties before amendments can be made.
If you didn’t establish a prenuptial agreement but wish you had, you also have the option of developing a postnuptial agreement. These agreements are very similar to prenuptial agreements and cover many of the same issues. Postnuptial agreements offer similar protections for your assets in case of a divorce and can help couples get on the same page regarding important financial matters.
Do I Have to Be Rich to Get a Prenuptial Agreement?
No, you do not have to have a high net worth to get a prenuptial agreement. Though they are commonly associated with the wealthy, many people from all walks of life have benefited from establishing a prenup. Financial issues are a common cause of divorce, and in some cases, having a prenuptial agreement can help you avoid unnecessary conflict. Not only does establishing a prenup help open up and encourage communication about important financial matters, but it can also help you and your future spouse make important decisions about how you will manage shared finances, property, and assets.
Do I Need a Lawyer?
While you and your fiancé can draw up a prenuptial agreement on your own, you should work with an attorney to ensure that the contract is legally sound. Additionally, both parties involved in the prenup must have legal representation to ensure that the prenuptial agreement is mutually beneficial. If a prenup is found to be overwhelmingly detrimental to one party, the courts will not uphold it. Similarly, there are limitations to what you can and can’t do with a prenuptial agreement. Working with a lawyer can help you ensure that your prenup is legally valid and that your best interests are protected.
Does Everyone Need a Prenuptial Agreement?
While many people can benefit from a prenuptial agreement, they are not appropriate or needed for all situations. For example, if your estate is relatively straightforward, you may not need to have a prenup in place. Additionally, if you want your state’s divorce laws to be applicable, you may not want to establish a prenuptial agreement.
Before deciding, you should consult with a trusted lawyer, like ours, at Hanson, Gorian, Bradford & Hanich. Your attorney can assess your situation and help you determine if a prenuptial agreement is in your best interests or not.