A prenuptial agreement (often called a “prenup”) is a written agreement between two people who intend to get married.
A prenup typically addresses how financial matters between the parties will be addressed in the event of a separation or divorce.
While prenups are not necessary for all couples, they may be helpful for many, especially for those entering a second marriage or marrying later in life. In many cases, the discussions leading up to a prenup can clarify each person’s expectations from the marriage and help the couple start their life together from a place of collaboration and transparency.
What Is the Purpose Of A Prenup?
Understanding a prenup is the first step to recognizing it’s purpose. The easiest way is to look at some of its applications. It is important to note that these agreements don’t necessarily have to do with divorce, but can address the death of a spouse as well. Some of the applications are:
- Protecting assets you have accumulated before your marriage, and specifying what you want to do with them. For instance, you may want to pass them along to children you had from a previous relationship. Or perhaps you are passionate about a charity and want those assets given to them.
- It can name who will manage financial details and handle assets.
- You can specify numerous things that have to do with finances. Things like which debts belong to which party, or what portion of funds belong to the individual, and which will be jointly shared by the couple.
- A prenuptial agreement can have a spouse waive rights to your retirement plan and name a different beneficiary.
- A prenup is a safeguard when there is a large age or financial disparity, allowing a party to control the distribution of the assets they will bring into a relationship.
The bottom line is that the main purpose of a prenuptial agreement is to give rights to an individual to do anything they want with the assets they had before their marriage.
Should You Consider A Prenuptial Agreement?
There are many different reasons why a couple may consider signing an agreement prior to or during a marriage. Many people may think that written agreements between spouses are not romantic and can anticipate that the marriage will end in a divorce. However, there is nothing wrong for planning ahead for the future and protecting your financial well-being. Prenuptial agreements can allow for couples to be straightforward about how their affairs will be handled after divorce. You can feel assured that your wealth or business interests will be protected and can focus on other matters. A prenuptial agreement can work to avoid significant conflict throughout the divorce process and can even preserve a civil relationship between the former spouses, which can be essential for a cooperative parenting relationship.
You should not hesitate to discuss the benefits of a prenuptial agreement with an experienced lawyer who can advise you whether such an agreement is right for your situation.
Important Facts To Know
The following are important things to keep in mind if you and your spouse do decide that a prenuptial agreement is right for you:
- Prenups must be in writing and must be signed by both parties.
- Both parties must sign the agreement voluntarily and there must be no coercion.
- Both parties must completely disclose their assets and must attach a statement of assets to the agreement.
- How premarital property is handled in case of separation, divorce, death, or other event can be addressed,
- Each party must be given enough time to study and consider the terms of the agreement.
- It is advisable for each party to be represented by independent counsel. However, if you do not choose to retain a lawyer, you may waive that right in writing.
- Child support, custody, and parenting time issues may not be addressed in a prenup.
- A prenuptial agreement goes into effect as soon as the couple marries.
- Prenup agreements are not valid for those couples who are not married; however, a cohabitation agreement can be drafted instead.
- You may include an expiration date. For instance, you may stipulate that the agreement will be void after five years of marriage.
Can An Agreement Ever Be Considered Invalid?
There are certain circumstances under which a premarital agreement in New Jersey or New York may be deemed invalid and thus, unenforceable. It is important to note that the person seeking to invalidate the agreement must prove through clear and convincing evidence that one of the following occurred:
- The party executed the agreement involuntarily
- The party did not consult with independent legal counsel and didn’t voluntarily and expressly waive, in writing, the opportunity to consult with independent legal counsel
- The party did not receive full and fair disclosure of the earnings, property and financial obligations of the other party, did not voluntarily and expressly waive, in writing, any right to disclosure of the property or financial obligations of the other party beyond the disclosure provided, or did not have adequate knowledge of the property or financial obligations of the other party
Draft An Agreement
If you are planning on getting married and want peace of mind for what the future might hold, consider a prenuptial agreement. These agreements can ensure your rights and property are protected in case of a divorce. Call our office today to speak with an attorney and learn about your rights.