2. You work in a family owned business
3. You have a large number of assets
4. You own your own home
5. You have been married before
6. You have an estate plan you want to maintain
7. You want to determine now how to divide property in the event of a divorce
8. You want to control spousal support in the event of a divorce
9. You have children from previous relationship/marriage
10. You are starting out in a very lucrative career
A popular misconception is that prenuptial arrangements are only for the wealthy. Anyone who has personal assets, liabilities or property — or children from a previous marriage — should consider a prenup.
A prenuptial agreement can clarify the financial rights and responsibilities of each party during the marriage and the distribution of property in the case of divorce or death. Prenups can protect spouses from each other’s debts. They can also spell out how one spouse’s property can be passed on to children from a previous marriage. In addition, a prenuptial agreement can indicate whether one of the parties is to receive alimony.
What the prenuptial arrangement cannot cover is anything illegal. Nor can the prenup have a provision that goes against public policy. For example, future child custody rights cannot be arranged in the agreement. States consider the welfare of children a matter of public policy to be decided by the courts when a marriage ends.
Many experts believe that prenuptial agreements should be confined to financial issues. They suggest that nonfinancial matters, such as household and child-care responsibilities, be handled in other ways.
Usually, prenuptial agreements involve a time element. Most become effective on the day of the wedding and last indefinitely. For various reasons, some are designed to go into effect after a certain number of years have passed. Others contain a provision to end after the couple has been married a specified period of time.
Discuss the possibility of a prenuptial arrangement well before the wedding. Unromantic as the subject is, it’s important to remember that finances are an integral part of the marriage partnership. Discussing these matters before you take your vows may prevent problems from developing later.
In addition to allowing sufficient time for planning, another basic rule in preparing a prenup is to be truthful about your financial situation. If one person hides something, this omission can make the agreement invalid. Be frank and honest — in discussing not just your finances but what you want out of a prenuptial agreement. Both parties need to agree on the goals of the prenup.