Long ago, having a prenuptial agreement was
considered stodgy or even insulting, but these days, “prenups” are becoming
increasingly common for high net worth couples. Simply put, a prenup formalizes
the understanding between spouses-to-be as to which of their assets will become
marital property.
The air is still heavy from
another tax season. However, if you lift your ears to the gentle spring breezes,
you may hear distant bells announcing this year’s wedding season. With many of
these weddings will come financial complications that require attention, well
before the vows are exchanged.
Marriage is not just “tying the
knot,” so to speak. No, marriage by its legal nature includes tying together
all of your financial resources and interests. Unfortunately, these days
marriage also has a dark side too: divorce.
For those couples with important
financial resources and interests in the marital mix, they may elect to use a
prenuptial agreement as sort of an “insurance” policy in the event the marriage
doesn’t work out as planned.
Prenuptial agreements are
nowhere as exotic as they are portrayed in the popular imagination. They can be,
nevertheless, useful and important documents when produced through a spirit of
full disclosure, careful deliberation, and independent legal representation.
Otherwise, as pointed out in numerous articles these days, no prenuptial
agreement is ironclad unless it is done correctly and, essentially, treated
like the contractual understanding that it is.
Recently, Forbes provides some guidance to evaluate the effectiveness of your
prenuptial agreement in an article titled “Five Reasons Your Prenup Might Be Invalid.” In addition, The Wall Street Journal offers some specific guidance to get your
prenuptial agreement ship-shape in an article titled “Shoring Up Your Prenup.”
Used correctly, a prenuptial
agreement, or even a post-nuptial agreement as the case may be, can help a
couple frame their financial resources and interests in the context of their
life together come what may.
That can provide great peace of
mind, especially when blending families and the children from those families.
Reference: Forbes (April
2, 2013) “Five Reasons Your Prenup Might Be Invalid”
The
Wall Street Journal (March 29, 2013) “
Shoring Up Your Prenup”