What to Look For in a Prenuptial Agreement

While no one wants to think about the end before it even begins, a prenuptial agreement is a safeguard in the event a couple gets divorced. It helps set certain terms so there is a fair settlement, and it can make things go much smoother. When drafting this document, there are certain topics a couple should discuss and decide on.

Pre-Marital Property and Debt

One reason for a prenup is to protect what each spouse had before the marriage. For example, if one partner bought property or certain assets before meeting the soon-to-be spouse, a prenup can ensure the property stays with him or her in a divorce.

On the other side of the coin, if one spouse enters into the marriage with excessive debt, such as from credit cards or student loans, a prenup can protect the other spouse from taking on that debt upon dissolution of the marriage.

Property Distribution

Each state has laws in place that say how property is distributed in a divorce. A prenup can bypass many of these laws, and division of property gained during the marriage can be decided upon by the couple. Deciding this beforehand can help a lot if a divorce occurs.

Common Items in Prenup Agreements

Each couple may choose to sign a prenuptial agreement for different reasons. However, there are common topics that a prenup typically outlines each spouse’s responsibility about, and these include

  • Retirement benefits
  • Separate businesses
  • Life insurance and property distribution in the event of death
  • Savings contributions
  • Joint bank account management
  • Alimony
  • Credit card spending management
  • Settlement of potential disagreements

Couples should be aware that decisions involving child custody and support are not allowed in a prenup. An agreement may also not include anything that is illegal. It should also focus on financial matters as opposed to personal ones. Avoid including preferences about household chores, child raising guidelines or holiday plans.

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