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Should my Future Spouse and I Have a Prenuptial Agreement?
Many clients come to us to ask us if we think it is a smart idea to have a prenuptial agreement drafted before they get married.
A prenuptial agreement, which is commonly referred to as a premarital agreement or prenup, is a special type of contract signed by two people before they get married. In this contract, they lay down what will happen if they get divorced regarding important rights and responsibilities. It also dictates what will happen if one partner dies.
When it comes to marriage, many people think of a prenuptial agreement as a pessimistic form of insurance that can lead to the failure of a marriage before it even begins. However, in certain circumstances, having a prenuptial agreement in Texas can be a smart decision.
A prenuptial agreement is a contract between two individuals that sets out the terms of their financial relationship in the event of a divorce or death. These agreements are most commonly used to protect the assets of one or both parties, clarify expectations regarding spousal support, and outline any other financial obligations that the couple may have to each other.
Texas law requires that both parties agree to the terms of the prenuptial agreement and that the agreement is signed by both parties in the presence of a notary public.
Although these agreements can seem unromantic, there are certain circumstances where having one in place can be beneficial. For example, if either partner has significant assets or debts at the time of the marriage, a prenuptial agreement can provide clarity on how those assets and debts will be handled in the event of a divorce.
Who Needs a Prenup?
Ultimately, it is up to you and your spouse to decide whether to go ahead with a prenup or not. If you are unsure, then it is worth reaching out to an attorney who can advise you based on your specific circumstances. There are lots of reasons why a prenuptial agreement could be a smart idea. Such as:
Either you or your spouse have been in a previous marriage and have suffered financially as a result
If you have been in a previous marriage and you suffered losses in the divorce, you may be concerned about marrying again if there is no prenuptial agreement. This is a common reason given, especially for those that felt they were taken advantage of for their assets and finances.
Either of you has children from other marriages
Sometimes one partner will wish to protect their children financially before entering into a new marriage. With a prenup in place, you can ensure that the money you wish to go to your children does, in fact, go to them in the event that you die.
Prenups could prevent fierce probate arguments about the marital assets that may occur after a party’s death if your wishes were not made clear.
One party has significant assets
The main reason people get a prenuptial agreement is when one party has significant assets and wealth. If one spouse is entering into the marriage and may end up with a significantly improved lifestyle, the other may be concerned that they are being used for their money and may be worried about things such as spousal support and division of their assets upon divorce.
One party has more debt
Prenuptial agreements can stipulate that if one spouse brings debts into the marriage, they cannot use community money to pay off the debts. This includes business debts. Without this, debtors may be able to pursue the recovery of their spouses’ debts from the community assets.
Either of you owns a business or has business partners
If you have built a business by yourself, it makes sense to sign a prenuptial agreement that protects your business in the event that you divorce your spouse. A prenuptial agreement also protects any business partners as their share may be impacted by the divorce proceedings if you and your spouse get divorced.
Prenups give full autonomy to you about how your business will be managed in the future.
Texas Prenuptial FAQ
What are the requirements for a valid prenuptial agreement?
In order for any prenuptial agreement to be fully valid, it needs to be in writing, and both parties must have signed it without coercion. The best way to ensure this is done correctly is to involve an experienced family law attorney, one that handles prenups on a regular basis.
Do I need to disclose all of my assets and finances?
Yes, when signing a prenuptial agreement, the disclosure of all assets, finances, and debts are required. This means you must disclose all financial information honestly if you want the document to be valid and to protect your financial future.
How do you ensure compliance with different state regulations?
If you own assets or businesses in multiple states, you will need to consult with an attorney that has experience in drafting contracts that fall in line with the state laws that apply. Each state has its own regulations regarding prenuptial agreements and it is important to make sure that your agreement complies with all of the applicable laws
What is a sunset clause?
Some people wish for their prenuptial agreements to have a time limit on them. This means that at the end of the time limit, often called a “sunset clause”, the prenuptial agreement is no longer valid. Sunset clauses can be used if the couple does not wish to have their prenuptial agreement ongoing for an indefinite amount of time. They are also beneficial for couples who think they may want to renegotiate in the future, as it sets a date when that could happen.
What cannot be included in a prenuptial agreement?
A prenuptial agreement cannot contain any provisions that are immoral or illegal. There must also be no violation of public policy.
A prenup cannot be used to waive a spouse’s right to their fair and equitable share of any assets or property that is acquired during the length of the marriage, as this is community marital property.
There must also be no provisions that would affect either spouse from receiving medical treatment through insurance.
Am I required to hire a lawyer?
There is no law that states you need a lawyer to draw up your own prenuptial agreement. But it is highly recommended to ensure that the agreement is legally binding and valid. If you choose to draw up your own agreement you run the risk of it being void for a variety of reasons. A lawyer can review the agreement in order to ensure that all relevant laws are taken into consideration and that your rights are protected.
I have heard from people who got divorced that prenups can easily be thrown out. Is that true?
When your prenuptial agreement has been drawn up by your legal representation and has been signed by both parties willingly, it is legally binding. This means that the courts can usually enforce them, and this means that they cannot be thrown out except in extenuating circumstances. Extenuating circumstances might include evidence of fraud or the fact that one party did not voluntarily sign it.
I just got engaged. Is it too soon to create a prenuptial agreement?
It is never too soon to consider a prenuptial agreement. Especially if you run a family business, have been in prior marriages, or have significant assets. This ensures that your separate property remains in your possession, even after the divorce process, should you get divorced.
Can I sign a prenup after we get married?
No, it is not possible to sign a prenuptial agreement after marriage. Prenuptial agreements must be signed prior to the marriage taking place in order for them to have any legal validity. Therefore, if you think a prenup might be beneficial, you should act quickly to protect yourself.
Am I able to change my prenuptial agreement?
In order to modify any prenuptial agreements, you and your spouse will both need to consent, in writing, to the changes that you wish to make, and you will both need to sign in order for the changes to be made and for it to become legally binding. Prenuptial agreements are legally binding contracts, so you should always consult a lawyer if you want to make changes.
Will a prenup increase my chance of divorce?
No, a prenuptial agreement will not increase your chances of getting a divorce. In fact, prenuptial agreements can help protect both spouses in the event of a divorce by setting out the terms of the division of assets and other matters. However, prenuptial agreements cannot prevent divorce. Ultimately, the decision to end a marriage is up to the couple involved.
Should my Future Spouse and I Have a Prenuptial Agreement?
Ultimately it is up to you and your spouse to decide whether a prenup would benefit you. An experienced family law attorney can assess your situation and give you more information about how a prenup can benefit you. That way, you can feel confident that your interests are protected.
At Skillern Firm, we are committed to protecting relationships and will help you and your spouse plan for your future. We will address all the things that matter to you and will ensure that your prenup is comprehensive and clear.
Arrange an initial consultation today by calling us at 936-213-8479.