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What is a Prenuptial Agreement?
Also known as a “prenup,” a prenuptial agreement is a contract created by a couple before they are married. Many people seek a premarital agreement for various reasons, such as clarifying property division and protection from debts in the event of a divorce. Contrary to popular belief, a prenuptial agreement does not mean a marriage is doomed from the start. It's a practical gift that a couple can give one another for peace of mind. Here's a quick checklist to open up discussions for couples to get started.
Steps to Start the Prenuptial Agreement Process
Before starting the prenup process, it's critical to find an experienced attorney to help you through the process and answer any questions that you may have. Since communication is vital from the get-go, your lawyer can address any concerns to ensure your agreement is fair to both parties. Here are some things married couples should consider when mapping out their prenup agreement:
Handling Premarital Assets and Liabilities
Making a list of your separate assets and liabilities is a critical component of a premarital agreement. Not only can this give both you and your future spouse a snapshot of each person's financial situation, but it can also help you stay on top of financial issues and concerns that each of you may have with each other.
How Assets and Income Will Be Managed
There are two types of people: spenders and savers. It's not uncommon for couples to have different financial styles. Knowing how each of you prioritizes money is critical to reaching your financial goals throughout your marriage. Mapping out how your assets and income will be managed is vital. For example, who will primarily be responsible for making financial decisions and handling bill payments, or will you have separate or joint bank accounts?
Ironing Out Credit and Debt
Many people ready to tie the knot do not fully know their soon-to-be spouse's credit and debt situation. When preparing your prenup agreement, it may be helpful to go over each of your credit reports and how much debt you are bringing into the marriage to work out how debt will be paid.
Spousal Support/Alimony
While talking about divorce before you've even said “I do” seems a bit awkward, learning how both of you feel about spousal support or alimony in the event of a divorce is part of the prenup process. Setting up the terms now can save you both future headaches.
Business Partnerships/Ownerships
If one spouse already has a business or you own a business together, it's critical to speak about how you will handle it after a divorce. It's essential to talk about keeping records and auditing the books to ensure fairness in dividing a business.
Want to Learn More About Prenuptial Agreements? We Can Help.
There are many benefits for engaged couples to set up a prenuptial agreement. From defining what qualifies as marital property to protecting family heirlooms, both parties can have peace of mind knowing their assets are covered in the event of a divorce.
While prenuptial agreements may not be for every couple, learning more about the benefits and how the process works can help you make an informed decision. If you and your future spouse are interested in drafting a prenuptial agreement, we can help. Our experienced family law attorneys are ready to answer your questions to get you started.
Contact Owenby Law, P.A.today at (904) 770-3141 to schedule a free initial consultation with our team.