If you are in the process of putting together a prenuptial agreement, you might be wondering what can and cannot be included in it. A prenuptial agreement is a contract, so seeking answers and ensuring you understand what this document can accomplish for you and your soon-to-be spouse is a wise and critical step. Here is what you need to know before signing your name.
What Prenups Can Do
- Separate Finances: Assets accumulated throughout the duration of a marriage are typically treated as marital or community property, regardless of whose name the assets are held in. In the event of a divorce, the marital property will be divided between them, whether through a negotiated settlement or by court order. A prenup is an excellent way to avoid having some or all of your personal accumulations divided. Specifying this in your agreement does not mean you expect a divorce, but planning for a worst case scenario is always a smart decision.
- Protection From Each Other’s Debts: Spouses do not just bring assets to the table, but debts as well. As such, in the absence of a prenuptial agreement, creditors might set their sights on community property to settle the debts of one spouse. If you want to ensure you are not responsible for your spouse’s debts, be sure to include this in your prenup.
- Provide for Children From Another Marriage: If either spouse has children from a previous relationship and wants to guarantee they inherit his or her share of property, a prenup is essential for accomplishing this. Both spouses can give up the right to claim a share of the other spouse’s property upon one’s death, protecting the interests of a spouse’s children.
- Keeping it in the Family: If there is something you want to keep within your birth family, whether if it is a share of a family business or a simple valuable keepsake, you and your spouse can agree for it to remain in your family.
- Make an Estate Plan: After you have used your prenuptial agreement to waive inheritance rights, it is important to also prepare estate planning documents, such as a will or a living trust, so you can transfer the property as you intended to.
- Define What Each Spouse Gets in a Divorce: In a divorce, if there is no prenup that states exactly how you and your spouse would like to have property and assets divided, state law will make these decisions for you unless you are able to negotiate a settlement. If left up to the court, you and your ex-spouse might be subject to a decision neither of you want.
- Specifying Responsibilities During Marriage: Prenups are not just for assets and property. Spouses can also designate financial responsibilities or specify expectations such as:
- Who pays household bills
- Whether or not they should have joint bank accounts
- How to handle credit card charges
- Agreements regarding savings
- Agreements regarding supporting one another through college or professional school
- The method by which you plan on settling future disagreements
What a Prenup Cannot Do
There are some things the law does not permit when it comes to what a prenuptial agreement is capable of doing, and rightly so. The following are generally off-limits:
- Restrict Matters Relating to Child Support or Custody: State lawmakers treat the welfare of children as a top priority and a matter of public policy. Therefore, no state would ever honor an agreement limiting or giving up future child support, or an agreement that impairs a child’s right to have a relationship with his or her parent.
- Give Up the Right to Spousal Support (In Some States): Some states limit the ability of spouses to give up the right to alimony if a divorce ever occurs.
- Promoting Divorce: In the past, courts often viewed the existence of any prenup as void since it was believed that such an agreement encouraged divorce. Of course, this is no longer the case, but there are some judges who might still take a close look at them. If it is believed that a prenup offers financial incentive for a divorce to one party, the prenup might be set aside.
- Make Rules Unrelated to Finance: Personal agreements should be kept out of a prenup. While the possibilities of non-financial matters are endless, here is a brief list of what not to include in your agreement:
- Designate responsibility for household chores
- Use of last names after you are married
- Agreements regarding having or raising children
- Matters regarding how you will relate to in-laws or stepchildren
- If you will have pets and who will care for them
If you choose to include these or any other nonmonetary agreements in your prenup, the court will likely not honor them. In fact, it might backfire on you and a judge on your case might throw out the prenup in its entirety.
Divorce Lawyers in Morris County
At O’Sullivan Law Group, we understand the difficulties of divorce and are here to offer our clients the dependable advice, relentless advocacy, and compassionate support they deserve. Our New Jersey legal team can help you better understand the laws that might impact your particular situation and work closely with you to achieve an outcome that serves your best interests.
Contact us today at (973) 947-8699 for a free consultation.