Most people gain their initial familiarity with prenuptial agreements when they hear dramatic stories about celebrities or other very wealthy people who have been forced to pay out large financial settlements to their ex-spouses, even in cases where the marriages were short lived. Often, their predicament happened because they neglected to sign a prenuptial agreement before the marriage. Some people look at prenuptial agreements as something that might jinx a marriage, as it indicates that the couple plans to fail at their marriage.
But actually, whether a couple has money when they first get married shouldn’t be the deciding factor when it comes to whether or not they sign an agreement. It is simply a precautionary step that assures that the couple is on the same page regarding their finances before they actually tie the knot. It is best to leave as much emotion and preconceived notions out of the process as possible and work out the details at least four months before the wedding, if possible. Then, the agreement becomes one less thing to worry about as the more celebratory provisions are made.
Who Should Consider a Prenuptial Agreement?
Older Couples
While there are few people who wouldn’t benefit from a prenuptial agreement, there are some that are more drawn to the idea than others. Wealthy people are obvious candidates, but another group that often works out these agreements is older couples. Many of these couples have been married before, and they often have children of their own or even other family members that they want to care for financially. One of the things that can be accomplished by a prenup is that it can preserve a person’s right to divide their assets to persons other than their spouse as they see fit. The whole idea of “what’s mine is yours” doesn’t carry as much importance as it does for some other couples.
Financially Independent
No matter how old a couple is when they get married, many simply want to keep their own financial independence. There may be some things, such as a home, that they purchase together, but they want to earn their own incomes and claim ownership to the things they acquire from the money they earn or even from personal gifts they receive. A prenuptial agreement can outline what possessions or debts should be shared, and which should stay separated. Debts apply to this equation as well. If a divorce does happen, no one likes to take on the responsibility of someone else’s poor spending and credit decisions. Often, a prenup can limit this responsibility and make it easier to start over if the marriage does end.
Provisions of Prenuptial Agreements
A prenuptial agreement is an important legal document, and deciding what to put into it takes careful consideration. The Law Office of Steven L. Fritsch in Carlsbad, California offers free consultations to individuals or couples who wish to discuss what sorts of provisions may be appropriate for a prenuptial agreement given their own circumstances. A lawyer can also help couples take the proper precautions to make sure that the document stays valid and let them know their options if they decide to alter the details of their agreement at any time during their marriage.
While the document is binding, there are instances where parts of it may be questioned. California law makes certain provisions that are meant to protect everyone concerned and give them the freedom to change their mind. It is not enforceable if one of the people did not voluntarily agree to the terms of the prenup or if they were not provided with fair and reasonable disclosure regarding financial obligations or property of the other person. Some agreements can also be overturned if they are made when one or both persons are under the influence of alcohol or other drugs, or even if they are made during a woman’s pregnancy, where some emotions might be considered unstable.
What Can Parties Contract to In Prenups?
What Can Be Contracted To
The first area parties may contract to is “property”. In other words, parties may agree that certain property is the husband’s and certain property is wife’s and other property is community property.
Parties may also agree as to the management and control of assets. For example, the parties can state in their premarital agreement that Husband will manage the business and have complete control over the business.
The third area parties may contract to in a prenup is the disposition of assets upon divorce or death. Parties may also agree that the parties shall create a will but a party cannot force the other party to do what they said in their will while they are alive. Choice of law is the next area parties may contract to. In other words, the parties may chose the state the laws will be enforceable. This means the parties may agree that their prenup is to be enforced under the laws of California. Therefore, if the parties later move to Kansas, it still must use California laws to enforce the terms.
The final and probably the most asked area is spousal support or alimony as called in the other states. Under California law, the parties can agree to waive spousal support in their prenup so long as the party that waived spousal support had independent counsel and it is not unconscionable at the time of when it is being enforced. What this means is that the court may not enforce a spousal support waiver if during the dissolution proceeding it deems the waiver unconscionable. In other words, if any attorney tells you that the spousal support waiver is “bullet proof” that statement is not accurate and you should not assume the court will allow the waiver upon a dissolution of marriage. Always make sure your future spouse takes the prenup to a separate attorney to review it.
What Can You NOT Agree to in a Prenup?
Child support is a “no, no”. For example, if the prenup says that if the parties have children and get a divorce that child support shall not exceed $500/mo. This is unenforceable no matter what. In California, child support is according to guideline and does not matter what was agreed to. Custody/visitation also cannot be agreed to in a prenup. For instance, you cannot say that upon dissolution the parties shall follow a 50/50 custody plan consisting of a week on, week off. This too is unenforceable for obvious reasons. The custody and visitation must be in the “best interests” of the child and if the court believes a different parenting plan is in child’s best interests than that will be the court order despite what the prenup says.
It is important that if you are getting married and want a prenup, to contact an attorney who is experienced in drafting prenups to ensure that the correct terms and language are inserted. For example, a “severance clause” is absolutely necessary which states that if any section is deemed unenforceable, that section, not the whole prenup, is unenforceable. Although there are many other issues to be concerned about when drafting a prenup, knowing what you and your future spouse can contract to is the first step.
To discuss what a prenuptial agreement might look like to you, contact the Law Office of Steven L. Fritsch today.
