Preparing a prenuptial agreement isn't about anticipating divorce.
It's about privately agreeing to the outcome of an unwanted, unfortunate situation, while each of you have the other’s best interests in mind.
What are the benefits of a prenuptial agreement?
The commonly known benefits of a prenup are that, in the unfortunate event of divorce, the agreement controls what happens to the couple’s jointly and individually owned property, and whether either person has rights to spousal maintenance (“alimony”).
Often overlooked is the benefit that prenuptial agreements provide as a method for discussing expectations with your partner regarding the financial management of your and your partner’s income and assets during the marriage.
With the help of counsel, a significant level of clarity is introduced into the economic realm of the partnership, a topic that is often neglected because of the particularly sensitive nature of the subject.
The benefits of a prenuptial or postnuptial agreement far outweigh any discomfort or cost involved when having one prepared for you, including:
Opening up a line of communication with your partner about expectations regarding how finances and property will be managed, both during the marriage and in the unfortunate event of divorce.
Knowing the economic impact of marriage and agreeing with your partner to fulfill those expectations.
Understanding each other’s rights in individually and jointly owned assets, such as business interests, investments, real estate, retirement, inheritance and other property that you acquire before and during the marriage.
Deciding with your partner whether either of you will require spousal support, including how much and for how long, should the marriage end in divorce.
Preserving assets for children from a prior marriage.
Ensuring against the costly expense of a litigious divorce.
A postnuptial agreement is another form of marital agreement, after you are married, that does exactly what a prenup would do for you if you had gotten the agreement done before the marriage. You can determine your rights to property owned in the past and the future, your obligation for (or rights to) spousal support, and every other issue typically covered in a marital agreement (other than custody and support of your children).
Some common scenarios that call for a postnuptial agreement include:
If you become a business owner during the marriage
If you decide to use an inheritance toward the acquisition of marital property
As a term of reconciliation with your partner, to govern the terms of a divorce if the reconciliation period is unsuccessful
What is a postnuptial agreement and why do I want one?
What can I protect in a prenuptial or postnuptial agreement?
Most prenuptial agreements cover some or all of the following rights to property and income:
Individually and jointly owned bank accounts
Individually and jointly titled real estate
Inheritance and estate rights
Individually and jointly held debts
Temporary and final spousal maintenance
One popular question is whether couples can agree to child custody and child support issues in a prenuptial or postnuptial agreement. The answer is ‘NO’, and the reason is because any issues directly impacting the best interests of the child(ren) cannot be determined ahead of time (i.e. before the issue is “ripe” for consideration).
How do I talk to my partner about getting a prenuptial or postnuptial agreement?
Talking to your partner about getting a prenuptial agreement can be challenging. Naturally, the sooner you mention it, the easier it is for your partner to digest and anticipate the process. What you want to avoid is waiting until after the wedding planning has begun. Not only is this unfair to your partner, but depending on the timing and circumstances, the courts may consider this a form of duress.
With a postnuptial agreement, the subject is often a little easier to discuss, because it is often accompanied by a life event such as starting your own business or trying to reconcile with your partner. In each case, it is important to focus on the interests behind the need for the agreement and develop an understanding with your partner of those interests in order for you both to take ownership of and accept the process.
In the most challenging of circumstances, I recommend framing the conversation around the fact that this agreement is a way for you both to agree to the outcome of a very unwanted situation. Focus on the fact that it is healthy for you both to understand each other’s expectations, and that the discomfort is shared, but it is temporary and a very responsible path forward.
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