Prenuptial agreements aren’t just for the extremely wealthy. If you enter into a marriage with a reasonable number of assets or business interests, you should seriously consider implementing one to remain protected. Bankrate explains some of the basic components of prenups.
Prenups establish who owns what
When couples divorce any property that is considered shared will be divided according to the laws of the state. Property that is considered separate is usually exempt from this process, and prenups can spell out who owns what at the onset of marriage. However, property or assets that you acquire during the marriage may be considered shared.
Prenups are good for second marriages
Financial division can be a bit tricky in blended families. Prenups sidestep some of those issues by establishing expectations up front. For instance, with an agreement in place a person can specify how the proceeds of financial accounts or life insurance should be dispersed in the event of their death. A prenuptial agreement can also establish ground rules for things like spousal support.
Prenups must adhere to certain rules
While the specific laws vary from state to state, prenups can’t include language about child support, custody, or visitation. These decisions are all made by the court using the best interests of the child as a guide. The document must meet certain criteria to be valid. It’s best to discuss the issue well before the marriage actually takes place to ensure it’s drafted and signed at the right time. An attorney can offer greater insight into the laws in your state.