Thursday, May 28, 2009
Do I Need A Prenuptial Agreement?
One of the most common questions asked by couples about to enter into a marriage is, "Do we need a prenuptial agreement?" Unfortunately, the answer to this question is very vague: "It depends."
First, let's talk about the typical situation where a prenuptial agreement is not necessary. When both partners are at relatively the same stage in life, a prenuptial agreement is generally not important. The same life stage can be defined as:
- Both people are marrying for the first time
- Neither has any children from a prior relationship
- Both have similar incomes
- Neither party has acquired any significant assets
A prenuptial agreement is necessary in situations where there is a disparity in assets or wealth between the marrying parties, or where one or both parties has children and wants to ensure that his or her wealth goes to the children.
In a typical prenuptial agreement, one or both parties agree to give up certain property rights that would be bestowed upon that party by law as a result of marriage. A prenuptial agreement allows each party to be able to dictate where his or her wealth will be distributed in the event of an untimely end to the marriage, whether through death or divorce.
The marrying couple can agree to just about anything in a prenuptial agreement. It can be unfair or imbalanced, as long as it is not unconscionable. In order to ensure that a prenuptial agreement will be upheld in court, both parties must have equal representation in the negotiation and execution of the agreement, and the agreement must contain as an exhibit a comprehensive financial statement of each party.
These agreements are highly technical documents, and it is important to have an experienced matrimonial law attorney draft it. Also, it is important to never sign a prenuptial agreement without having it reviewed by your attorney.