December 13, 2011
Authored by: Abigail Weisbrod and Jeanne Mattingly Miller
Maybe it is all the time spent with friends and family, or the spirit of giving, or maybe it’s just all the mistletoe, but whatever the reason, the few months from Thanksgiving through Valentines Day always seem to be filled with engagements. As all of these happy couples begin to plan their weddings, and their lives together, many spend more time thinking about the band, picking out the perfect cake or looking for that perfect starter home than they do preparing for what may happen if things unravel down the road. Unfortunately, today the odds are not in favor of happily ever after.
Divorce is a difficult reality that many couples will eventually face. Entering into a prenuptial agreement before walking down the aisle can protect both parties should divorce become a reality. A prenuptial agreement is an agreement between the engaged couple to address how specific issues will be handled should the marriage end in divorce and on death. While these agreements may not be necessary for everyone, they are not just for the rich and famous!
Yes, they are important for the super wealthy, particularly important if one spouse brings substantially more wealth into the marriage; however, they may also be important for a host of other reasons. For example, if one spouse brings a great deal more debt into a marriage, owns part of a business, or expects to earn a great deal more than the other, a prenuptial agreement can address what happens to debt, business or wealth at the time of the divorce. Further, if one spouse plans to sacrifice his or her career to care for the family, the issue of financial support is likely to be hotly contested at the time of divorce. If one spouse has children or obligations from a prior marriage, a prenuptial agreement can be very important in assuring the security of those children.
Prenuptial agreements are highly individualized, and the terms will depend on the specific needs of each couple. Still, most agreements cover, at a minimum, some basic concepts. Generally, a prenuptial agreement will cover how the property you each bring into the marriage is treated, how inherited property is treated, and how the property earned during the marriage will be treated, in the event of a divorce. Often there are terms regarding children from prior marriages, or the custody of children not yet born, the maintenance of life insurance to benefit a spouse or children or perhaps how the family residence will be treated in the event of divorce.
Of course, every lawyer hopes that once a prenuptial agreement is negotiated and signed, that it will stay tucked away in a file, while the couple lives happily ever after. But in the event that a marriage does unravel, having a valid prenuptial agreement in place will protect the couple.