We answer many questions from clients who want to know about prenuptial agreements and whether a prenup would be right in their situation. While we discussed several of these questions in an earlier blog, the topic of prenuptial agreements can be so controversial for many people that we wanted to provide additional guidance.
Here are three further questions to help guide anyone in New York who is considering a prenuptial agreement.
1. What are the benefits of a prenup?
Prenuptial agreements can offer a variety of benefits. In addition to providing financial security, a prenuptial agreement can limit or prevent litigation in the future. Perhaps even more importantly, the process of creating a prenuptial provides the incentive and opportunity for a couple to hold difficult conversations about money and expectations for their marriage. It is far better to engage in these discussions when the relationship is at a very strong point than to wait to address sensitive topics later when the marriage may be in trouble.
2. What does a prenup protect?
A prenup protects property the parties owned before the marriage, which is referred to as pre-marital assets. The agreement defines what will be considered marital assets and it describes how both pre-marital debt and marital debt will be handled.
Additionally, a prenup can protect a party’s right to spousal support or protect a spouse from having to pay spousal support. It can protect against nasty litigation if you divorce. A prenuptial agreement provides peace of mind during the marriage because each spouse knows what their rights and obligations are.
All marriages end, whether by divorce or death. So, a prenup can also protect estate rights should one spouse die.
3. What does a prenup NOT protect?
A prenup cannot protect your rights regarding child support or child custody if the children aren’t yet born when the prenup is signed.
Additionally, a prenup may not protect your interests if you don’t get proper legal advice or if you enter into the agreement too quickly without giving your partner adequate time to carefully consider the terms. You should take the time necessary to seek legal advice and thoroughly review a prenup beforehand.
4. How do you know if a prenuptial agreement is right for you?
If it’s important to you to protect the assets you bring into a marriage, you should think about a prenup. This agreement could help you understand what you can and cannot do with those assets during the marriage and so you can plan accordingly. It’s easy for money you earn during the marriage to get mixed up and commingled with pre-marital assets.
For instance, many people want to be able to use assets they acquired before the marriage to buy a home or another valuable asset that will benefit their spouse and family. Without a prenuptial agreement, it’s difficult to know what you may get back from that investment. It can be hard to determine how to credit each spouse for the contributions made with their separate property. Litigation often centers around these issues.
Another reason to get a prenup is to keep a divorce as non-adversarial as possible. Most people don’t want to experience—or have their children experience—a contentious divorce. Having a prenup can help avoid litigation and save you or your children from unnecessary emotional turmoil.
You should also consider a prenup if you anticipate that one spouse may give up his or her career to be a primary caretaker of your children. Stepping out of the workforce for even a few years can cause a significant setback for the stay-at- home parent. This can impact their future earning capacity and make potential re-entrance into the workforce difficult. A prenup can address how that parent will or will not be supported should the marriage end.
5. It seems expensive to get a prenup. How will I know if it’s worth it?
I encourage clients to think about the value of a prenup over the cost. Yes, it may cost several thousands of dollars to negotiate a prenuptial agreement. But think how much you could save in both emotional and financial terms before you calculate the true value a prenuptial agreement could provide.
The biggest cost savings usually stems from the avoidance of litigation. But entering into a prenuptial agreement with clear communication with your fiancé about what is important to each of you can also save a heavy emotional toll in the future. A well-drafted prenuptial agreement will give you peace of mind during the marriage and will allow for more ease and less animosity regardless of whether the marriage ends in divorce or upon death.
Contact Us to Receive Our Prenuptial Agreement Checklist or to Schedule Your Initial Consultation
Deciding on whether a prenuptial agreement is right for your situation can be a sensitive topic for many couples, especially when they are preparing to start their married future together. If you have additional questions about prenuptial agreements, we would be happy to talk to you. Just give us a call at 212-768-1115 or complete the form below.