Montgomery County Prenuptial Agreement Attorney
Some marriages end in divorce. Most people who get married do not enter into the marriage hoping it will end, but sometimes it is important to plan ahead for a divorce. For most couples, who either enter a marriage without a large amount of wealth or have about the same amount of money, planning ahead for divorce may not be a big concern.
Sometimes, though, the parties to a marriage have vastly different financial situations going into the marriage. In a typical Pennsylvania divorce, the court will divide the marital property “equitably” – which usually means “fairly,” but does not necessarily mean a 50/50 split. For those marriages where one spouse is much wealthier than the other, this could be a devastatingly large amount of money lost along with the marriage, even if the spouse gets less than half. There are ways, though, to protect your finances from a big divorce.
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What is a Prenuptial Agreement?
A prenuptial agreement, usually known by the nickname of “prenup,” is an agreement between spouses before marriage. The “pre-” means “before,” and “nuptial” means “a wedding,” so a prenup is simply an agreement made before marriage. Many mispronounce the word as “prenuptual,” but the proper term is “prenuptial.”
The actual content of a prenuptial can vary from case to case, but the main point of creating a prenuptial agreement is to decide up-front what the other party may receive in the case of divorce. This can be done a few different ways, including creating specific things that will be awarded upon divorce, or limiting which assets are available for division. It may simply describe property and make clear to both parties that those assets are not marital property and will not be divided upon marriage.
Ultimately, the goal of a prenuptial is to protect someone’s wealth from being given to the other spouse if they ever get divorced. This does not mean that the other spouse should get nothing, and so prenuptial agreements are often quite fair even though they usually establish a split that is less than 50/50.
In order to make prenuptials fairer to the spouse who is not wealthy, there may be conditions placed in a prenup. These may include clauses that nullify the agreement should it end due to the wealthy party’s abuse or adultery, allowing the harmed spouse to seek a higher percentage of the marital property at divorce.
Who Needs a Prenuptial Agreement?
In some cases, if you think you might need a prenuptial agreement, it is better to be safe than sorry. Paul McCartney of The Beatles famously married his second wife in 2002 without a prenuptial, while he was worth approximately $800 million. When his marriage ended in divorce four years later, his wife was awarded approximately $48.6 million. Despite being advised to get a prenup, McCartney refused, and lost a large sum of money because of it.
Certainly, most people in Pennsylvania are not multimillionaires, but McCartney’s situation can still be a lesson. If you think that you have a lot of money, unique assets, property, inheritances, or a business, you may be doing yourself a disservice to get married without a prenup. Especially in the case of business owners, you may be hurting not only yourself but your employees and your business by getting married without a prenup.
In order to decide if you need a prenup, it is important to understand what property is usually divided upon divorce. Each spouse comes into a marriage with their own money and possessions. These are known as “individual property,” and generally stay with the spouse who started with them. Everything that is gained or purchased during the life of the marriage, with some exceptions, belongs jointly to both spouses and is called “marital property.” Marital property also includes any increase in value of the parties’ individual property. That means that, while a husband may enter a marriage owning a $10,000 painting, if after five years of marriage the painting is worth $50,000, that $40,000 increase in value is jointly owned by both parties.
Some prenups are designed to exclude property, like the example of the $10,000 painting, from following the rules regarding increase in value. This is especially useful for people who own investments, property, collector’s items, or a business. Since a business may grow in value over the life of a marriage, depending on the way the business is owned, all of that growth could become marital property. Divorce could ultimately put business ownership and control in your ex-spouse’s hands, which could be devastating to its management.
7 Things You Should Know about Prenuptial Agreements
They’ve been a feature of a dozen soap opera plots. People who ask for them are often villainized. But a prenup can be a smart move.
In fact, they’re getting extremely popular, largely because people are getting married much later in life and so have more to protect. And while nobody wants a marriage to end in divorce, we all know divorces are common.
#1) They’re not just for the rich.
You should consider a prenup any time there’s a significant disparity between your assets and your intended spouse’s.
You should also consider getting one if you plan on getting separate bank accounts, if you are a professional who relies on intellectual property to secure your living (i.e., a published author or songwriter), if you have an inheritance you need to protect, or if you own a business prior to getting married.
#2) They should cover assets and debts in depth.
Prenups require you and your intended to disclose all your assets and debts, just like a divorce agreement would. The agreement will outline which existing assets will be considered non-marital property. This should keep them from being divided up in the event of an eventual divorce.
They can also cover who will be responsible for covering any debts which either party brings into the marriage. It’s worth mentioning prenups are also becoming more popular because both spouses are more likely to have a significant student debt load going into the marriage. Without a prenup you could end up responsible for paying your ex’s student loan debt in the event of a divorce.
#3) They can cover spousal support.
You can hash out spousal support in a prenup long before the divorce, which can avoid confusion and arguments later.
Keep in mind the law has recently changed to remove spousal support tax breaks. This could leave a prenup including a spousal support agreement open to challenges later.
#4) You cannot determine child custody or support with a prenup.
Child support and custody agreements may not be covered in a prenup. The children you’d be talking about usually haven’t even been born yet. It’s impossible to sit at a table prior to a marriage and make decisions about what might be in the best interests of those children in terms of custody.
Child support is also already ruled by state guidelines, which a prenup cannot overturn.
#5) “Lifestyle” clauses are unenforceable.
People have tried to put all sorts of crazy clauses into prenups. You can try to put in clauses about your spouse’s weight, or about infidelity, but they’re completely unenforceable. Prenup provisions are not contingent upon your spouse’s good behavior. Behavior barely factors into many divorce cases.
#6) Under certain circumstances, they can be challenged or thrown out.
Under certain circumstances a judge may choose not to honor your prenup. Prenups found to be fraudulent because a spouse hid assets or debts can be thrown out. So can prenups signed under duress and prenups that were never properly filed in the first place.
In some cases, judges can even get rid of a prenup they feel is too lopsided.
All of these are good reasons why you should seek the help of a qualified family law attorney before creating or signing a prenup. Otherwise, it might not be worth the paper it was written on.
See also: Prenuptial and Postnuptial Agreements.
#7) They don’t lead to divorce.
Sure, sitting down and making “just in case we divorce” plans isn’t very romantic. Everyone would like to believe their marriage will last forever. But it is very realistic.
It’s also a way of talking about your finances and getting certain issues on the table and out in the open. A mature couple might well see a prenup as a realistic way to protect both parties. Buying car insurance doesn’t guarantee a car wreck, and getting a prenup doesn’t guarantee a divorce.
Are you getting ready to get married?
Contact the family law attorneys at Sadek and Cooper to discover whether a prenup makes sense for you and your spouse.
Speak With a Montgomery County Prenuptial Agreement Attorney Today
If you think you might need a prenuptial agreement, you should speak to an attorney who can help you plan your future. The Law Offices of Sadek and Cooper represent clients who need prenuptial agreements, are going through divorce, and those facing other family and divorce law challenges. For a consultation with an experienced family lawyer at Sadek and Cooper, call 215-814-0395.