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How a Prenuptial Agreement Can Ensure You’re Protected for Every Possible Scenario
Prenuptial agreements used to be something that only the very wealthy considered, but today, they are recommended for most couples. With the average age of marriage hitting 30 years old for men and 28 years old for women, more people are already financially established before they choose to get married. Having a prenuptial agreement in place can ensure that both parties are protected and have a clear understanding of how any marital assets will be divided if the relationship doesn’t work out.
Protecting Your Assets
One of the main objectives of a prenuptial agreement is to specify what assets are separate property. For most people, this includes any property that they came into the relationship with. Common examples include liquid assets in their bank account, retirement accounts, a vehicle, or real estate that was bought prior to the marriage. However, it is possible to set up a prenuptial agreement to identify some property acquired after the marriage as separate property. For example, a prenuptial agreement might state that any real estate acquired with funds from a separately owned bank account and only deeded in one person’s name will remain their own separate property.
Identifying what is separate property and what will be marital property is especially important because of California’s community property laws. Anything that is not already qualified as separate property or is specific as such in a prenuptial agreement will be subject to the community property asset division guidelines in the event of a separation or divorce.
Establishing Debt Liabilities
When many people think of property division, they really think of asset division. They picture things like who will get the house and vehicles or how stocks and investment accounts will be divided. But property division in California also includes dividing up the debts. Any debts that are acquired during the course of the marriage are considered jointly owned. This is true even if the debt is only in one spouse’s name or the other spouse had no knowledge of the debt.
A prenuptial agreement can outline how any debt acquired during the marriage should be divided. Many couples choose to agree that any debt only in one person’s name will be that person’s sole responsibility. This can help protect you from financial problems later on if you find out that your spouse has racked up a large amount of debt that you weren’t aware of.
Outlining Provisions for Spousal Support
Because prenuptial agreements can contain most things related to finances and property division, they can also cover spousal support. In California, spousal support is either temporary or long term. Temporary spousal support orders are generally used to help one party establish financial independence after the divorce, especially if they didn’t work outside the home or have a much lower income earning potential than their spouse. Long-term spousal support usually comes into play if the couple was married for a long time or if there was a large difference in income or earning potential.
Using a prenuptial agreement to decide whether either party will pay the other spousal support — and how much and for how long — can simplify the financial decisions that need to be made during the divorce. Establishing this at the beginning of the relationship can also sometimes lead to fairer decisions because the parties aren’t yet in an adversarial relationship.
Requirements for a Legally Binding Prenuptial Agreement
There are specific requirements for a prenuptial agreement to be considered legally binding and enforceable under California law. Both parties must be signing freely and without any undue influence or coercion, and the agreement must be made in writing. Before a prenuptial agreement can be signed, both parties must receive a true and thorough financial disclosure from the other person to ensure they’re aware of the assets and debts in question and no one is hiding anything that could impact whether both parties want to sign. Prenuptial agreements in California must be notarized to be valid, and they do not go into effect until the date of the marriage, even if they are signed months before.
Elements That a Prenup Isn’t Allowed to Cover
Prenuptial agreements are generally limited to decisions related to property division and financial matters. Prenups cannot include any decisions related to child custody or child support, as these must be determined through the courts and by the best interests of the children. Contrary to popular belief, a prenuptial agreement cannot include any nonfinancial requirements for the relationship. For example, people often believe that they can include clauses that require one person to be a stay-at-home parent or to always put their socks away. But this isn’t enforceable, and including prohibited terms in your prenup could cause a judge to potentially throw out the entire document. Prenuptial agreements are also not allowed to include any language that requires either party to do anything illegal or anything that could be considered unjust or exploitative.
Working With an Orange County Family Law Attorney
Getting your own legal counsel before signing a prenuptial agreement is vital to ensuring that your interests are protected. It’s normal to think that the other person would have your best interests at heart when you’re about to start a life together, but this simply isn’t always true.
If you’re engaged and want to make sure you’re prepared for anything that may come in the future, call The Bledsoe Firm at 949-363-5551 to speak with an attorney about drawing up a prenuptial agreement. Our experienced family law attorneys can help you decide what to include and ensure that your agreement is legally binding and enforceable.
