Deciding whether to enter into a prenuptial agreement is a personal decision, and one that requires some consideration for your individual situation. Arguments for and against entering such an agreement depend on your and your spouse’s individual finances and property, as well as your relationship with one another. It’s not an easy conversation to have, for sure, but in the event of a divorce, having one can protect both of you.
Here are some things to consider when deciding whether to enter into a prenuptial agreement.
Prenuptial Agreement Pros
For many couples, even mentioning the word “prenuptial” is taboo. It is almost as if by bringing up the topic, they are dooming the marriage from the start. But the fact that money is one of the primary reasons for divorce, thinking that a prenuptial agreement does harm couldn’t be further from the truth. Even if you and your spouse decide not to go through with a prenuptial, at least you’ve had the conversation. Putting everything out in the open as early as possible is usually good for a relationship.
If you decide to go through with a divorce in the future, and that is a big “if,” a prenuptial agreement will help you:
- Reduce conflict during the process
- Avoid long and costly court proceedings
- Keep property, debt, income, retirement funds, and assets separate
- Establish processes for any extenuating circumstances
Prenuptial Agreement Cons
On the other hand, a prenuptial agreement might not be right for you if you:
- Feel that the conversation would damage your relationship
- Have not yet accumulated extensive wealth or assets
- Want to include any provisions that would be considered personal, such as the splitting of household labor
- Think that child support should be included
As you can see, these agreements pertain only to the financial side of marriage. Certain provisions, like the household labor example above, can get your prenuptial agreement struck down as frivolous. Determining child support is a separate process completed by the court, making any provisions that pertain to it void.
Questions to Ask Yourself
So, should you get a prenuptial agreement? That’s completely up to you. You’ll have to decide whether the financial considerations outweigh the personal. Fortunately, many people have been exactly where you are right now, and they’ve already asked the important questions:
- What kind of real estate do you own?
- Do you own more than $50,000 worth of non-real estate assets?
- Do you own a business or part of a business?
- Does your job give you access to stock options or profit sharing?
- Does your estate plan name beneficiaries besides your spouse?
- Have you accumulated more than a year of retirement benefits?
- Do you earn more than $100,000 a year?
Answering these questions can make the decision easier. As a rule of thumb, the more you and your spouse are worth, the more you will benefit from a prenuptial agreement.
Still on the fence? Let us help. Call today. 305-441-9530