Premarital Agreement (Prenup)
A premarital agreement is a contract entered into by a couple who plan to marry. It determines their rights regarding property and support when the marriage ends-whether by death or divorce. Some premarital agreements provide that each party will keep all money earned and assets acquired before or after marriage; in other words, what’s his is his and what’s hers is hers. Other agreements provide for each party to keep premarital and inherited assets and for assets acquired through their efforts during the marriage to be shared. Some agreements provide for one spouse to make transfers of cash or property to the other spouse or provide for alimony for a dependent spouse in the event of divorce.
Doesn’t a premarital agreement mean the engaged couple don’t trust each other?
Not really. There are many reasons a couple considering marriage may want a premarital agreement. A party may wish to provide for children of a prior marriage in his or her estate planning. In fact, a premarital agreement can improve family relationships when a stepparent enters the picture by giving children the peace of mind of knowing that their inheritance expectations remain intact. When there is a family business, the party and his or her family members may feel a premarital agreement is necessary to protect the business in the event of a death or divorce. When a party has been married and divorced he or she may be reluctant to marry again without a premarital agreement. With the high incidence of divorce, even hopeless romantics must recognize the risk of failure. For many couples it is better to acknowledge the possibility of divorce and agree on a fair division of property in advance if things do not work out for them than to take their chances with the courts.
Are premarital agreements only for the very rich?
Not at all. One reason even people of modest means may want an agreement is to decide in advance how assets accumulated during the marriage will be handled in the event of divorce or when the first spouse dies. Other reasons might be to reassure one another that neither party will seek alimony or to agree that the parties will use mediation, arbitration, or a collaborative process in the event of marital dissolution. Deciding such matters in advance, before a breakdown in the relationship, can significantly reduce legal fees for divorce and can give both parties peace of mind.
I want a premarital agreement. When should I bring up the subject with my fiancé(e)?
As soon as possible after deciding to get married, before booking the caterer or putting down a deposit for a honeymoon cruise. Unfortunately, many people delay because they are uncomfortable bringing up the subject. The longer the party who wants the agreement waits, the more difficult it becomes. Couples seeking a premarital agreement almost always underestimate the amount of time it takes to negotiate an agreement that is acceptable to both parties. Often they think all they need is a simple agreement because they are not aware of all the issues they should consider. It is also unfair to the other party to delay; delay may make it difficult for him or her to obtain competent counsel and to negotiate the terms. Negotiations that take place in the midst of wedding plans with invitations about to go out can be extremely stressful for both parties and too often unfair to one of them. Unfairness breeds unhappiness and that is not a good way to begin a marriage. In addition, if the wedding date is coming soon, a party may later claim that s/he signed the agreement under duress. Ideally, the parties should have 3 or 4 months to consider and negotiate the terms of the agreement.
Chad Foster is a trusted Washington lawyer serving Snohomish and King counties with an office in Bothell. Contact us today to discuss your legal issue.