You read about the stars and how their prenup is going to impact the latest high dollar divorce. But, what about the average couple. Is a prenup right for them? Here are 3 pros and 3 cons.
When a Prenuptial Agreement Might be a Good Idea
1. There Is A Big Difference In The Financial Status Of You And Your Partner. A prenuptial agreement can protect you both. For the person who has the most assets, it can define who has the rights to property owned prior to marriage and, in some states, it can limit the amount of alimony that can be awarded. On the other hand, it can protect the partner who may be much weaker financially by ensuring some financial aid is in place.
2. It’s Your Second Time Around. A second marriage is a whole different animal from a first marriage. It may involve children and child support, spousal support and a whole new set of considerations too make a blended family work. It also may involve considerable assets. A prenuptial agreement can give each spouse the right to define various assets. It also insures that your wishes will be followed in the event of your death and both your new and old families will inherit according to your wishes.
3. It Protects Your Business. If you are a business owner or a partner in a business, a prenuptial agreement can protect your business in the event of divorce. You don’t want your ex to become an unwanted partner if you separate and divorce. Spell it out so that a share of your business is not in jeopardy during a divorce.
Why a Prenuptial Agreement Might Not be a Good Idea
1. Until Death (Or Divorce) Do You Part. Marriage is a commitment and planning for it to end before it even starts may weaken the commitment you need to see you through the hard times. If you’re starting out together and a prenup isn’t needed to protect certain assets, you might get a stronger start – and a stronger marriage — by skipping it.
2. It Can Keep You In A Bad Marriage. This is the opposite of what it is supposed to do. But, if a prenuptial agreement is very one-sided, the partner that has the most to lose may decide to stick it out even when it would be more sensible to throw in the towel.
3. It Can Backfire. Things change and you may think that the prenup is keeping your assets safe, but if those assets rapidly decline in value, you could end up with less than your partner if the partner’s worth has grown while yours was shrinking. An entirely different distribution may be more equitable if you divorce after a number of years, but the prenup may have everything locked in place.
A prenup doesn’t cover everything. Your state laws will take precedence so, if, for example, you put who would be the custodial parent of unborn children in a prenup that probably will not hold up in court. It also assumes honesty so if there’s something you didn’t disclose, that asset will not be covered by the prenup. If you think you need or want a prenup, be up front with your significant other. Then, talk to a family law attorney and get expert advice. That lawyer can advise you on the necessity of a prenuptial agreement and then draw up an agreement that will hold up if you ever need it. A good family law attorney can make all the difference.