A detailed explanation of why you should have a prenuptial agreement before marrying.
Oct 20, 2021
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A prenuptial agreement is a sort of contract that two people make before getting married. For the marriage term, this contract could spell out each party's responsibilities and property rights. A prenuptial agreement, often known as a prenup, is a legal contract entered into by a couple before their marriage that specifies how their assets will be divided if their marriage ends. Prenups are more typically used to spell out the terms and conditions for sharing financial assets and duties if the marriage ends.Breakdown of a prenatal agreement
Prenuptial agreements have long been a contentious issue among couples. Prenups are frequently depicted in the media as mechanisms used by celebrities and other high-net-worth persons to limit the wealth an ex-spouse can claim. On the other hand, a prenuptial agreement can be a fair manner of dividing assets and obligations when properly drafted and implemented.
How Do Prenuptial Agreements Work?
Prenuptial agreements are governed by state law, although the American Bar Association points out that "All of them demand that such agreements be 'fair' both procedurally and substantively. To determine if a deal is fair, you must understand basic contract law principles including capacity, duress, fraud, and undue influence."
The reasons for signing into these agreements vary, but wealthier spouses generally do so to protect their assets. Furthermore, elderly spouses may desire such an arrangement since they may have assets or retirement income to retain and safeguard and the desire to ensure that offspring from previous marriages receive a portion of their estate.
Prenuptial agreements can be contentious for couples, especially if one partner is significantly wealthier than the other. When a marriage ends, a percentage of prenups end up in court. The agreement will be judged by a court to see if it was fair and not coercive. Prenuptial agreements that are sprung on the spouse on or near the wedding day are often frowned upon by the courts.
A prenuptial agreement typically contains a list of each partner's assets, a few indications of which assets will persist the property of each spouse in the event of a divorce, parameters for how property acquired during the marriage will be divided in the case of a divorce, language on debts acquired before or during the wedding, and a summary of spousal support such as alimony should the marriage end.
It's unclear if a prenuptial agreement hastens or delays divorce. If one spouse seeks to have the prenuptial agreement overturned by the court, it might lead to a long and expensive legal battle. On the other hand, a unanimous prenuptial agreement guarantees less discovery in the areas designated in the contract and hence less acrimony everywhere. As a result, the court and attorneys will be relieved of part of their duties.