Once seen as an inducement to divorce, and thus a detriment to marriage, prenuptial agreements are now treated as a strength for marriage, though they are not for everyone.
A prenuptial agreement is a contract that re-writes the laws of divorce and estate law. These agreements can eliminate the potentially gray areas of family law by allowing couples to plan their future with more security and make certain determinations as the parties see fit.
As I mentioned in a previous Huffington Post column on marriage contracts, there's a popular perception that prenuptial agreements are a cynical way to enter into a marriage. It's true that prenups recognize the possibility of divorce, but with roughly half of all marriages ending in divorce you would be ignoring reality if you didn't attempt to protect your interests before tying the knot.
In general, there are four factors to consider when deciding whether you should pursue a prenup:
1. Age of the parties: the older you are, the more likely you need one.
2. Children from a previous relationship: a prenup is always a good tool to protect the financial future of children from prior marriages or relationships, but these agreements are not allowed to regulate issues relating to children of the future marriage, such as child custody.
3. Presence of substantial assets: the more assets you have, the more likely you need a prenup.
4. Disparity of assets: if there is a large disparity in assets between the two parties, then you want a prenup.
The lack of a prenup invites complexity and injustice if those factors apply to your situation.
Approaching Your Spouse
It is important to understand that agreeing to a prenup is not planning on your marriage failing; it is providing a plan for how to deal with the property of the parties in the event the marriage does not last. It is only ever used in the event that the marriage fails, which could happen whether or not the prenup was signed.
Also, a prenup can be designed to protect both spouses, not just the spouse with more assets at the beginning of the marriage who is likely proposing the contract.
What To Include In Your Prenup
The content of a prenuptial agreement can vary widely, but it commonly includes provisions for division of marital property, including both assets and debts. However, prenuptial agreements cannot provide for matters of child custody because judges will not enforce a previously decided parenting plan, as said plan may be written prior to the birth of the child or the parties' current situation
The parties may include certain clauses that can change the terms of the prenup in certain circumstances, for instance a provision that if one spouse cheats, the other will be entitled to a larger share of the marital estate.
Prenups should contain venue clauses to ensure the parties are aware of which state's laws will apply in the event that they need to enforce the agreement. A sunset provision may also be inserted into a prenuptial agreement specifying that after a certain amount of time the agreement will expire.
Severability provisions are necessary parts of prenuptial agreements that allow for the court to sever an unenforceable provision while still upholding the rest of the agreement. Otherwise, without such a clause, the court may strike the entire agreement if one aspect is found to be unenforceable.
The agreement must not be unconscionable at the time it is executed. In order to avoid problems on these grounds, both parties must be of sound mind and the agreement must be provided in advance of the wedding.
There is case law establishing that a prenup signed too close to the wedding date can be dismissed. A good rule of thumb for when to sign a prenuptial agreement is before the date is set and invitations are mailed.
Who To Get Help From
Each party should be represented by a separate lawyer. This will prevent a conflict of interest and the appearance of overreaching by one party, both of which are grounds to set aside a prenup.
A CPA or other financial advisor would be helpful to ensure the parties understand the long-term financial consequences of the agreements reached. For instance, divisions of investment accounts can have unintended tax consequences that both parties should be aware of before signing an agreement.
Understanding what you and your future spouse are asking for and the potential consequences is crucial before signing.
Prenuptial agreements are highly specialized contracts because they consolidate contract law, matrimonial law, property law, and support law. It takes an attorney with an in-depth understanding of these areas of law and how they intersect in the world of domestic relations to adequately protect the rights of the soon-to-be-wed when they find themselves in the position of being a soon-to-be-ex.
Contact the divorce lawyers at Cordell & Cordell for additional information and tips on executing a prenuptial agreement.
Joseph Cordell is the Principal Partner of Cordell & Cordell, a nationwide domestic litigation firm focused on men's family law matters. Cordell & Cordell also provides a website dedicated to informing men on the divorce process and the challenges they face. Visit http://www.dadsdivorce.com for more information