Prenuptial agreements, also known as premarital agreements or prenups, are legal contracts that are entered into before marriage. It is possible to enter into a similar agreement after the wedding, in which case it is called a postnuptial agreement or postnup.
A prenuptial agreement outlines the terms of property division and spousal support in the event of a divorce. Couples often consider a prenuptial agreement when they have significant assets or income that they wish to protect in case of a divorce and the prenuptial agreement can establish expectations for the distribution of property and financial support. However, if a prenuptial agreement is not well drafted, it can have a significant impact on divorce settlements, especially for affluent couples.
Protecting Pre-marital Assets
If a future affluent spouse has substantial assets, such as real estate, investments, and businesses, a prenuptial agreement can help protect these assets and help the argument that they should not be subject to division in a divorce. This can be particularly important for individuals who have built up these assets over many years and want to position themselves to keep those assets in a divorce settlement.
Preparing for Every Eventuality
Another advantage of prenuptial agreements for affluent couples is the elimination or reduction of uncertainty. Prenuptial agreements can establish expectations for the distribution of property and financial support. For example, if spouses have a significant difference in income, a prenuptial agreement can be used to establish the terms of spousal support, including the amount and duration of support. This can be particularly helpful for affluent couples, as they may have a greater risk of prolonged litigation regarding the amount and duration of support, and they have a greater need to balance the need for financial security in the event of a divorce and the need to limit their financial liability.
Prenuptial Agreements Must Be Detailed
However, prenuptial agreements are not always problem free. Some spouses regret signing the prenuptial agreement and dispute some of the terms of the prenuptial agreement. If the prenuptial agreement is not very well drafted, it is possible that the court will set it aside. For example, prenuptial agreements will not be upheld if they are not fair, transparent, and entered voluntarily.
For example, if one spouse has an attorney, but the other spouse is not represented by an attorney, the prenuptial agreement might not be considered fair. If one spouse was forced to sign the prenuptial agreement because there was a deadline such as the wedding day, the judge may find that the agreement was coerced and it will not be upheld. As a catchall, if the terms of the agreement are one-sided or unconscionable or would leave one spouse in a state of financial hardship, the agreement may not be upheld.
In conclusion, if the prenuptial agreement was created by a competent, experienced prenuptial attorney, the likelihood of a divorce settlement increases greatly. If a poorly drafted, hurried, or unfair prenuptial agreement is drafted, the chances of a settlement decrease significantly, and the chances that the matter will be litigated to attack the validity of the prenuptial agreement increase. This is especially true for affluent couples where a spouse has the means and incentive to litigate the matter.
Contact an Expert Prenuptial Agreement Lawyer
If you are considering marriage and need a prenuptial agreement, contact our attorneys well before the wedding date. If you are faced with a divorce and have a signed prenuptial agreement, schedule a time to discuss its potential impact on a possible divorce settlement. Please call us at 616-285-0808 to schedule your complimentary meeting.
