Ten percent of the 2.5 million couples getting married this year were engaged on Valentine’s Day. Experts believe that each of these couples should have a prenuptial agreement to deal openly with their financial matters and provide a type of insurance if they ever divorce.
Prenuptial agreements defined
A prenuptial agreement is a written contract entered by the engaged couple that covers property, cash accounts, financial responsibilities and other financial matters. Prenups grant a degree of self-determination to couples with addressing many property division and other financial matters. Otherwise, a judge may impose an order dealing with these issues under Pennsylvania’s family law regardless of what the parties want.
A prenuptial agreement is intended to protect both spouses. These agreements usually cover:
- Assets obtained before or after marriage
- Education and retirement funds acquired before or during marriage
- Continuing spousal financial responsibilities after divorce
- Inheritances
- Life insurance policy payouts
- Valuation and dividing a business
These agreements can reduce the costs, time, and stress of a divorce. Prenuptial agreements are also important because couples attain more assets, their property becomes commingled over time in their marriage.
Preparation
A prenuptial agreement provides engaged couples with the opportunity to discuss their financial assets. Couples have the advantage of making decisions under amicable conditions and not while they undergoing the stress and acrimony of divorce.
A prenuptial agreement is not enforceable unless it is fair and equitable. It cannot be deceptive or exploit a party. Coercion, such as requiring the agreement as a condition of marriage or introducing it on the wedding eve, may also invalidate a prenup. Each person must have their own lawyer represent them.
Exclusions
Prenuptial agreements generally govern financial matters and do not cover issues such as living conditions, a spouse’s appearance, or anything illegal.
Prenuptial agreements may not address child support, custody, and visitation. Courts decide these matters based upon the best interests of the child and the couple’s financial and emotional situation when they divorce.
Postnuptial agreements
Prenuptial agreements are entered before marriage. Couples may also enter a postnuptial agreement after they marry that governs similar issues. They often execute these agreements following a major life change such as beginning a new business, having children or when a spouse quits working.
Couples may also have a prenuptial and a postnuptial agreement. A postnuptial agreement may amend a prenup to make changes such as agreeing to spousal support after the couple has children, there is an inheritance, or a spouse acquires property.
Attorneys can help negotiate and draft these agreements. They can also protect rights and help assure that the agreement’s meets a couple’s needs.