Planning to get married? There’s one legal document that could protect you from a lot of heartache down the road.
Used to be, prenuptial agreements were the domain of the rich and distrusting. Not anymore. Preparing a prenup is just smart legal planning that benefits both people.
But here’s the thing…
If a prenup isn’t prepared correctly, it’s totally useless.
Enter the legal considerations. The things you need to consider when drafting a prenup. Done correctly and the agreement is rock-solid. Done incorrectly and it’s a giant waste of time.
What you’ll learn:
- What Makes a Prenuptial Agreement Legally Valid
- Common Legal Mistakes to Avoid
- Key Clauses Every Prenup Needs
- When to Consult a Legal Professional
- How to Protect Yourself and Your Partner
What Makes a Prenuptial Agreement Legally Valid
A prenup doesn’t automatically become ironclad the second it’s signed. There are several key legal considerations and requirements to address.
You need to meet all the legal requirements for a prenup to be valid. Your agreement must be prepared according to state law, or it may be challenged or thrown out by the court.
Arkansas laws are slightly different, so, if you’re in the area, consulting with a Prenuptial Agreement Lawyer in Arkansas is essential. The laws in your state or jurisdiction matter so much when you’re hiring legal services for prenuptial agreements.
Most states require these key legal considerations for a prenuptial agreement to be valid:
- Written Agreement. The prenup must be in writing and signed by both parties. Verbal agreements are not valid.
- Voluntary Signing. Both parties must sign the agreement of their own free will. The court may not enforce the prenup if one party was forced or coerced into signing.
- Full Financial Disclosure. Both parties must fully disclose all assets, debts, and income. Failure to do so can render the prenup invalid.
- Notarization. The prenup must be notarized before a notary public.
Straightforward enough, right? It’s when people start to try and cut corners that things go wrong…
Common Legal Mistakes to Avoid
Drawing up a prenup agreement without proper legal advice is asking for trouble. The prenuptial agreement is an enforceable document, and the mistakes above are most common errors that make them unenforceable.
- Signing Too Close to the Wedding. Couples can run into major problems if one person presents a prenup the day before or days before the wedding. A court is likely to see this as duress or coercion.
- Failure to Obtain Separate Lawyers. You should each get your own legal representation. While it may be cheaper to have one lawyer draw up the agreement, there are plenty of pitfalls. It’s a conflict of interest, and one of the partners may use that to challenge the agreement in the future.
- Including Unenforceable Terms. A prenup agreement can cover property division, spousal support, and debts. It can’t cover custody or child support for future children.
- Unconscionable Terms. If a prenup is heavily in favor of one party over the other, it’s unlikely a court will honor the agreement.
A recent Harris Poll survey found that 47% of millennials who are engaged or married have entered into a prenuptial agreement. The numbers are growing as more people understand the benefits. But these agreements are only as good as the person who draws them up.
Key Clauses Every Prenup Needs
A well-crafted prenup will address all the major financial considerations in a marriage. These are some of the clauses that every prenuptial agreement should include to protect both parties:
- Asset Division. How will property be divided if the marriage ends? What is separate property and what is marital property?
- Debt Responsibility. Who is responsible for debts brought into the marriage? Who is responsible for debts accrued during the marriage?
- Spousal Support. Also known as alimony. This is where the prenup can specify whether spousal support will be paid and how much.
- Inheritance Protection. Do you want your inheritance to remain separate? A clause like this can ensure inherited assets remain separate.
- Business Ownership. If one partner owns a business, this clause can protect it from being divided in a divorce.
According to research by the Institute for Divorce Financial Analysis 63% of financial professionals think prenuptial agreements reduce the likelihood of nasty court battles. It’s because prenups already have agreed terms in place.
When to Consult a Legal Professional
You may be tempted to draft a prenup agreement yourself. Don’t do it.
Family law is a complex area of law. Each state has different rules and regulations when it comes to what is and isn’t allowed in a prenuptial agreement. Just because one agreement is perfectly valid in one state doesn’t mean it would be enforceable in another.
Professional legal help is required when:
- One or both of you own a business
- There are significant assets or debts involved
- One of you is significantly wealthier than the other
- Either of you has children from a previous marriage or partnership
- There is complex inheritance or estate planning at stake
A qualified family law attorney can ensure your prenuptial agreement meets all the legal requirements in your state. They can help you identify potential issues before they become problems in the future.
How to Protect Yourself and Your Partner
A prenup agreement is not a document you use to plan the failure of a marriage. It’s a tool that protects both parties and provides clarity.
- Start the Conversation Early. Don’t leave it until the wedding is next week. Start talking about prenups months in advance.
- Be Completely Transparent. Full financial disclosure isn’t just a legal requirement, it’s a necessity to build trust. Share all your debts, assets, income, and future expectations.
- Plan for the Future. Things change. Make sure to include provisions in the prenup for reviewing and amending it in the future. A prenup drawn up when both parties are young professionals may need to change once there are children or career changes.
- Keep Emotions Out of It. This is a legal document, not a conversation between two partners. Treat it as a business agreement. Remember, the point of a prenup is to protect both partners, so make sure the terms are fair to both parties.
Bringing It All Together
Prenuptial agreements are a valuable legal tool for couples who want to protect themselves and plan for their future.
The legal considerations to keep in mind when creating a prenup are simple but vital. The agreement must be in writing, signed by both parties voluntarily, and full financial disclosure is required. Both partners should obtain separate legal representation as well.
Cutting corners or trying to include unenforceable terms can invalidate the entire agreement. The most common mistakes are leaving things to the last minute, not having separate lawyers, and including one-sided terms.
A well-prepared prenup will have clauses addressing asset division, debt responsibility, spousal support, inheritance, and business ownership. The more clarity both parties have, the better off you will be.
Working with a qualified family law attorney can ensure the agreement is valid, fair, and enforceable. They can also protect you and your partner from potential legal challenges in the future.
Prenuptial agreements aren’t for the distrustful. They’re for the smart who want to protect themselves, be transparent with their partners, and have clarity in their financial planning.
