Signing a prenuptial agreement before starting a marriage is frowned upon by many people. People question whether you really love your potential spouse if you decide to sign a prenuptial agreement. But executing a prenuptial agreement is about finances and planning for a future that no one can predict. It is a plan for disposition of assets in case the marriage ends.
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What is a Prenuptial Agreement?
A prenup is a way to ensure there will be no expensive and extended squabbles over property if the couple decides to divorce. It shows that both parties are interested in maintaining an amicable relationship even if the unimaginable happens.
A romantic wedding is great but the reality is that many marriages in America end in divorce. Parties sign prenuptial contracts before marriage or civil union.
Why get a prenup?
Finances are among the top reasons why couples fight. By putting everything on the table before entering a marriage, it becomes easier for the parties to negotiate financial matters once they are married. This could actually end up strengthening the relationship.
Some couples believe that their assets are not significant enough to require getting a prenup. But they do not consider that a few years into the marriage their fortunes could change. For example, a business venture could take off or their savings could accumulate substantial value.
It is better to agree on disposition of marital wealth when you and your spouse are getting along. During divorce the emotions may be too charged for a couple to agree. Some of the pros of signing a prenuptial agreement include:
- Helps protect the inheritance rights of children and grandchildren from a previous marriage
- Protects the spouse that gets into the marriage with little or no debt especially if the other spouse has more debt
- A spouse that sacrifices a lucrative job after a marriage can be compensated if the marriage ends if that is included in the prenuptial agreement.
- It can specify how couples would share responsibilities and how they can make decisions on specific issues
Who needs a prenup?
The factors that should get couples to think about a prenuptial agreement include:
- If one of the spouses or both of them are bringing property into the marriage
- If both or one of the parties are remarrying
- If the parties have children from a previous marriage or union
- If one spouse is entering the marriage with a lot more wealth than the other or is poorer than the other
- If one of the spouses is entering the marriage with a lot of debt
- If both or one of the spouses wants to protect their property
A prenup helps remove some of the risks of marital property disputes in times of divorce. However, there are some pitfalls of a prenuptial agreement. For example, you may have to give up your right to inherit property from your spouse if they die. This is because you will not be entitled to that property if you are not included in the will.
But a married couple can terminate or change a prenuptial agreement after marriage, by entering into a new subsequent agreement that disavows or changes the prenuptial agreement. The new agreement has to be in writing.
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