Modern Guidance for Prenuptial Agreements
For many, just bringing up the subject is a difficult, tense endeavor: how can you make sure you’re financially protected during marriage while not destroying the romantic sentiment between you and your partner? However, although it’s not always easy, it’s vitally important: for the sake of your finances, you need to draft an agreement that guarantees your protection in the event of divorce.
In fact, some business folks liken them to professional shareholder contracts: both force the parties involved to contemplate and discuss various potential scenarios ahead of time and make sure you are on the same page regarding a mutual understanding. If/when there is a point of contention, you both have a document available for reference. In this sense, these agreements can foster honesty, communication, patience, and trust. In addition, it can significantly decrease legal costs upon divorce.
Some of the most important reasons why people getting married should contemplate a prenuptial agreement (“prenup”) include:
- Keeping assets separate: including property, inheritance, investments;
- Keeping debts separate: creditors can go after marital property if just one spouse has incurred debt if there is no prenup. Prenups can also address other financial issues such as credit card and/or student loan debt;
- Defining inheritance issues early on: especially if you want any property or assets to go to children versus a spouse;
- Defining rights to a home: especially if one partner owns a home that both people move into after marriage, this will ensure that the circumstances by which the non-owning spouse can stay in the home are clearly defined, particularly if/when children and concerns over their property rights are involved; and
- Specifying children’s rights: A prenup can prevent strife and fighting between your partner and kids by defining gifts from the outset.
In addition, certain high liability professionals (such as attorneys or doctors) may choose to set up a Domestic Asset Protection Trust as an add-on (or form of) prenuptial to ensure that their assets are protected from creditors and lawsuits.
If you’ve Just Gotten divorced…
Similarly, if you’ve just gotten a divorce you will want to make sure you do the following, even if you had a prenup in place:
- Review and potentially revise beneficiary designation forms;
- Protect identity and credit status through credit services (for example, Equifax); and
- Start a Roth Individual Retirement Account (IRA).
Talk To Us about Pre- or Postnuptial Agreements
Even though divorce can be difficult, the financial decisions you make with your attorney will have a profound effect on important areas in your life, such as retirement. To learn more about drafting contracts to protect yourself during marriage, contact the law office of Sandra Bonfiglio, P.A. in Florida. We will help guide you through staying protected while maintaining the strength of your relationship with your loved one.