Prenuptial agreements are stereotyped as being the domain of the rich and famous, but spouses of all income brackets use them for various practical reasons. If at least one of the following situations applies to your case, a prenuptial agreement may benefit you.
Prenuptial agreements shield spouses from debts each other owe, which can be especially critical if one or both spouses are entering the marriage with significant debt.
Children from prior relationships or marriages
If you have children from a previous marriage, a prenuptial agreement could ensure that your wishes for estate distribution will be followed. You could spell out in a prenuptial agreement what assets go to which children and also outline how you plan to provide for your prospective spouse in the event of your death. Otherwise, in some cases, your spouse could assert a claim for most of your assets, leaving very little for your children.
Proactively stave off conflicts
Prenuptial agreements can be a sensible way to provide further peace of mind for prospective spouses who want to enter a marriage with their responsibilities and expectations clearly outlined. If rights or responsibilities shift, an agreement can be modified as necessary.
Conflict prevention also applies to divorce. You can use a prenuptial agreement to establish property and asset distribution and any alimony or palimony cases. In some cases, a spouse who owns a business may want to protect it. Some states don’t allow spouses to waive their alimony rights, while other states mandate a lawyer must represent a spouse doing so.
Legal and Personal Implications
The peace of mind offered by a prenuptial agreement can be invaluable. For example, take the case of a couple that has agreed the wife will stay home with any children while the husband works. The wife is putting herself in a vulnerable position by losing years of income, and a prenuptial agreement can guarantee that in the event of a divorce, her contribution won’t be shortchanged.
Other similar situations apply. For example, one spouse working and helping to pay for another spouse going for an advanced degree could find himself or herself in a weaker financial position if a divorce occurs. A prenuptial agreement will spell out a fair resolution.
Some people see prenuptial agreements as a sign that their prospective spouse has little faith the marriage will succeed. It can become an emotional issue rather than a logical one. It’s also true that in some agreements, one prospective spouse is seen as having more power than the other. For the most part, judges uphold prenuptial agreements even when divorce laws would provide what one party sees as a fairer resolution.
Prenuptial agreements do not necessarily stave off court battles. Furthermore, as marriages change and evolve, agreements in a prenup may be outdated, so adjusting them when necessary or making them flexible in the first place can be important.