Modern Marriages and Pre-Nuptial Agreements : Smart Move
You and your future spouse are planning your life together and will soon legally marry to become man and wife. Are there personal or family situations that should be legally addressed in advance to enhance future happiness and preclude avoidable legal entanglements?
More and more couples are signing prenuptial marriage agreements to make their legal transition to married status easier and more stable from the onset. In a 2016 American Academy of Matrimonial Lawyers Survey, more than 60% of the legal respondents said that they have seen a substantial increase in clients seeking “PRE-NUPTIAL AGREEMENTS” in the past three years. Many attorneys attributed this increase to both spouses working and financially supporting the family unit, couples dealing with financial inequality or couples of great wealth. These couples want to put all their financial cards and related issues on the table before they walk down the aisle to avoid potentially great expense and prolonged painful litigation should the marriage fail.
Texas is a “Community Property State” and in the event of a divorce will divide property equally between the divorcing parties based on the assumption that all assets acquired during their marriage belongs evenly to both parties. With the continued high divorce rates and many boomers/seniors remarrying in larger number, many couples are considering legal marital contracts to avoid a difficult expensive divorce.
A Pre-Nuptial Agreement allows prospective spouses to specifically define the rights and obligations to each other in advance and further allows spouses to decide their future marital property rights with relativity minimal judicial actions or involvement.
A Texas Pre-nuptial Agreement can cover any matter except one that:
- Violates Public Policy or a statute imposing criminal penalties
- Adversely affects a child’s right to support
- Defrauds a creditor
(Texas Family Code 4.003(a)(8), (b),4.106(a))
WHEN SHOULD YOU CONSIDER A PRE-NUPTIAL AGREEMENT? In today’s world many couples feel the need to have a legal contract in place which will protect their approaching marriage and conflicting financial situation without causing a disastrous and costly divorce.
What are some of the more important situations for consideration in a Pre-Nuptial Agreement?
- A couple who has a separate estate plan for their families to inherit their assets.
- One of the partners has substantial assets that needs to be kept independent from their future spouse’s
- One of the partners owns a business or has multiple business or interest in investments and needs to keep this independent from the future spouse.
- One of the partners may have financial/creditor problems and the other person needs protection. This could include student loans or large credit card debt.
- There may be special considerations to settle, such as pets, special family items, or even frozen eggs or sperm, that need to be addressed before the wedding.
- One partner’s money habits and styles may be totally different from the other partner and this situation needs to be settled in advance of marriage to the satisfaction of both future spouses.
Among the permissible provisions that partied can list in a prenuptial agreement are as follows:
- Rights and obligations of any interest, present or future, legal or equitable, vested or contingent, in real or personal property.
- Right to manage, control and dispose, by agreement, property upon separation of the married parties, dissolution of the marriage, death of either party, or other agreed event.
- A provision that modifies or eliminates spousal support.
- Specific matters related to prospective spouses, including personal rights and obligations that are not in violation of state laws.
- Choice of a state or country law that will govern the Pre-Nuptial Agreement.
- Creation of a Will or Trust.
- Disposing of the Estate upon the death of one of the spouses. Also, ownership rights and disposition of benefits from a life insurance policy upon death.
- Waives right of one party to occupy the family homestead after the other party dies.
When you have decided that you need to set up a Pre-Nuptial Agreement now where do you begin? You need to find a knowledgeable attorney who can help you with the preparation of the binding marital contract. Both you and your fiancé need separate attorneys to make sure you both are fairly and independently represented in this matter. This is a very serious and legally binding agreement and should be considered an enforceable binding contract. Don’t be one of many spouses who wakes up from their sweet wedding dream to find that the pre-nuptial agreement they agreed upon is far from what they wanted or thought it would be.
Mark A. Nacol
Nacol Law Firm P.C.