A prenuptial agreement is a type of contract that determines legally what each spouse gets in case of divorce. Prenup addresses issues about assets that each individual comes into the marriage with and how property or monies acquired during the marriage will be divided in the occasion of a divorce. It does not make any determination regarding future child custody rights, however.
Prenuptial agreements are sometimes referred to as an “antenuptial agreement,” or in even as, a “premarital agreement.” Such agreements have existed for thousands of years in some form or another, particularly in European and Far Eastern cultures, where royal families have always made provisions for protecting their wealth.
Even though harsh words have flown between sweethearts when the word “prenup” mentioned but to look at it professionally, a prenup is smart financial planning. It can be considered to be a business arrangement or an insurance policy to help remove some of the emotion that may be involved when there are problems in the marriage. As much as we do not like to think of it this way, marriage is not only an emotional and physical union. Marriage is also a financial union.
It’s important that an agreement contain viable clauses because if it has unconscionable or illegal clauses the judge may toss the prenup in its entirety as a joke such as requiring that your spouse not gain weight, or that he or she quit smoking and take out the garbage three times a week. The judge will conclude that these two individuals have created a document just to be obnoxious. There are four goals for a prenuptial agreement.
Ã¢Â?Â¢ To protect each spouse from the other’s debts;
Ã¢Â?Â¢ To provide for children from previous marriages;
Ã¢Â?Â¢ To keep current finances separate;
Ã¢Â?Â¢ To keep specific property with acquiring to-be-spouse.
Most couples bring personal debts and assets to a marriage. If there’s no prenup, creditors can sometimes turn to marital or community property to satisfy the debts of just one spouse so a prenup can limit each spouses liability for the other’s debts.
Provide for children from prior marriages.
A prenup is helpful if either of you has children from another relationship and you want to make sure that your children inherit their share of your property. In a prenup, one or both spouses can give up the right to claim a share of the other’s property at death, perhaps in exchange for an agreed upon amount of property.
Keeping finances separate creates simplicity in the occasion of death or divorce. Even though every state has laws designating their own specific laws to debts and assets accumulated during marriage many times are held in the name of just one spouse.
Keeping Property With The Acquiring To-Be-Spouse
If property includes something that one individual wants to keep in his or her birth family, whether it be an heirloom or a share in a family business, it can be agreed upon before vows are exchanged and a name is shared in matrimony. These assets will remain in the bride’s family or the groom’s family because they will be specified in the prenup. This can include property that you may expect to receive in a future inheritance.
One of the positives about a prenup, is that you and your spouse have the opportunity to make decisions about division of property rather than the courts which have to follow state law. Many states allow couples to make agreements regarding whether or not one or both will be entitled to alimony and child support in the occasion that children are born to the union.
Community Property States
The nine community property states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington or Wisconsin. The law states that property accumulated during the marriage will be divided equally.
Creating a Valid Prenup
Perhaps the most important ingredient of a solid prenuptial agreement is honesty and individual clarity. The prenup must be signed a minimum of 30 days before a wedding or, in other words, before invitations have been mailed. If either party presents a prenup to his or her sweetheart at the rehearsal dinner, someone may find himself or herself tossed out the back door on their thoughtless behind. A prenup should be agreed on together for the benefit and the good of both parties. A valid prenup is fair and kind not leaving either one of the parties destitute.
Do you want to be legal or do you want to be lazy about this document? Well, if you want to be legal, use an attorney who is familiar with the intricacies of a prenup and will give simple clear recommendations for clauses and conditions.
If you want to be lazy, scribble your prenup on a napkin at McDonalds and laminate it or something. You might end up with a measly $100 million like Steven Spielberg’s wife. A joke?.. well, not really but she could have been much richer if she would have had a lawyer present, at least when the terms were hasty scribbled on a greasy napkin before their marriage.