Why do I need a pre-nuptial agreement?
Prenuptial agreements (“pre-nups”) are becoming more common these days, with divorce rates as high as ever. These contracts serve as a financial agreement between two people that outlines what will happen if the marriage ends. While many people do not like to think about a new marriage failing, it is important to keep in mind that divorce law exists as a basic pre-nuptial. However, divorce law leaves a lot of room for arguments that can be expensive and bitter. Here are some situations in which you should look into a formal pre-nuptial agreement.
If you have important issues that you want to resolve out of the gate, consider a pre-nup agreement. Certain heirlooms you want to protect, a financial investment package or even a beloved pet can be protected if you put forth an agreement that these remain yours before you ever go into marriage.
If you and your partner have a large financial imbalance, a pre-nuptial agreement can protect you both. If you earn more than your partner or are wealthier in general, or if your partner has a great deal of debt, a pre-nuptial agreement will allow you to protect your finances should the partnership fail. It can limit alimony and child support and make sure that you get to keep whats yours in the unfortunate event that things go sour.
If you are a partner in a business, an agreement of this type could be mandated by your partners, who will not want the danger of your spouse owning a piece of the business after a divorce. Even if you own the business alone, you could end up having to share it with a spouse. This can be a disaster if a divorce is particularly contentious; it means building a new partnership out of a failed one.
If you are going into a second marriage a pre-nup can be very important. You could have concerns left over from your prior marriage that could create many complications. You will want to protect support and alimony obligations and any other shared assets to avoid a potential three-way split. In addition, you can be sure with an agreement that should you pass away, your assets will be fairly divided according to your wishes.
Pre-Nup: Planning Your Future
Perhaps the most important reason to sign a pre-nuptial agreement is to engage in planning your marriage. Such an agreement will put all of your assets on the table and get everything out in the open. This is not to indicate that one spouse is necessarily lying or hiding things. You may, in fact, have assets you did not even realize were assets.
Creating this agreement can often open both partners eyes and allow them to see clearly what they have and how to best use it moving forward. In this way, an agreement can be a benefit to the marriage.
Our team of lawyers offer significant experience in developing and interpreting pre-nuptial agreements. If you are curious about the process or are ready to set up an agreement as part of your wedding planning, connect with us to learn more.
We can also assist you if you are getting a divorce and need advice dividing assets or interpreting your pre-nuptial agreement.