A Prenuptial Agreement: The Wedding Gift You Need?
Uttering the phrase “Prenuptial Agreement” often gest the same visceral reaction as the mention of any infamous villain in a movie (e.g., Hannibal Lector, The Joker, Scar)? Better yet, while everyone still “Isn’t Talking About Bruno…,” you should be talking about having a Prenuptial Agreement with your fiancé!
Unlike movie villains, the true intention of a Prenuptial Agreement is to provide protection and to mitigate conflict in the event the marriage fails. Think about it. Do you have health insurance because you are expecting to be ill? Do you have car insurance because you expect to get into an accident? No. You have insurance so that you have protection if you become ill or get into an accident. The same is true for a Prenuptial Agreement. You are not expecting to get divorced but at least you will have some level of protection if a divorce does happen. A Prenuptial Agreement offers more than what you may have heard (or assumed) but here are things to consider:
Future Protection. Many people think that a Prenuptial Agreement only addresses and protects the assets or debts that each party has at the time of marriage. But, that is only one part of a Prenuptial Agreement. You don’t know what the future holds regarding your income or assets, but you can still outline what you would like to happen to those items in the event of divorce. For instance, you and your fiancé may agree that each party will receive a specific percentage of any asset acquired during the marriage. Or, you may agree that each party will keep any debt held in his or her own name regardless of whether it was acquired during the marriage. You can also decide how much spousal support will be determined based on years of marriage or in consideration of a party leaving the workforce because of a child being born in the marriage. So, while you may “not having anything” right now, there is a very good chance that you will have income, assets, and debts during the course of your marriage that you want to have a plan for in the event of a divorce.
Full transparency at time of marriage. Do you really know how much debt your fiancé has? Does your fiancé know how much you have in savings? A Prenuptial Agreement requires full disclosure of income, assets, and debts by both parties. The disclosure of financial information is not the only “window into your fiancé’” that you see because of a Prenuptial Agreement. Rather, during the drafting of the Prenuptial Agreement, you and your fiancé are showing each other how well the two of you handle difficult or uncomfortable topics. That can be a game changer! You are entering into a marriage with someone who you love, respect and trust. The best gift you can give each other is full transparency in starting your lives together.
Cost Effective Plan. If you think a wedding is expensive, then you haven’t talked to someone who has been through a divorce. Having a solid Prenuptial Agreement can mitigate divorce costs as the Agreement outlines the agreements reached when everyone was on “good terms.” Keep in mind that it is critically important that you and your fiancé each work with lawyers to prepare the Prenuptial Agreement so that the document complies with the laws of your State. Do not make the mistake of ignoring proper procedures in preparing, reviewing, or executing the Prenuptial Agreement because that will cost you at the time you need it most (a/k/a enforcement time)!
Understanding of Legal Rights and Responsibilities. Getting married is a legal contract. It is important to truly understand your legal rights and responsibilities upon marriage. Since the terms of a Prenuptial Agreement must fall within the bounds of the law, this is the opportunity for you and your fiancé to truly understand your legal rights and responsibilities as a married person.
A Prenuptial Agreement is an insurance policy for your marriage. Let’s hope you never need it! But you will be happy that you have it if the need arises. If you are engaged, then consider meeting with a lawyer to discuss getting a Prenuptial Agreement and understanding your legal rights once married. It is truly the wedding gift that you didn’t know you needed!
