Creating Prenups

Aug 8, 2012 by

The use of prenuptial agreements is more common among second and third marriages than for first time unions. That fact is completely understandable in the U.S. today where the divorce rate for first-time marriages is around 50% and the numbers get worse from there. Divorce statistics show that currently around 65% of second marriages and 75% of third marriages will end in divorce in the United States. As people age and accumulate more assets and experience, prenuptial agreements are a good way to ensure their property rights and financial position are protected in the event of a divorce. Anyone who enters a marriage and brings a significant number of assets or children from a prior marriage into the partnership would be a good candidate for a prenuptial agreement.

Although all prenup agreements are legal contracts, some are better than others and in order to stand up in court, a prenup must fully disclose each spouse’s assets prior to signing as failure to do so can result in the agreement being thrown out of court later when any hidden assets come to light. This is why it is also a good idea that each spouse has their own attorney own attorney review the prenuptial agreement document prior to signing.

Even though prenuptial agreements can include specific instructions or stipulations concerning the division of property or maintenance costs, there are limitations when it comes to custody and child support issues. Prenuptial agreements are limited in that they cannot be used to get out of paying child support or to set up future child custody arrangements. What they can do is to help with estate planning issues for dependant children and specify how money will be used for college, secondary education or other special education issues and many people utilize prenuptial agreements to create specific provisions for their grandchildren.

 This is not to say that everyone needs a prenuptial agreement though. Unless a couple entering a first marriage is already wealthy and own a lot of separate personal property, they probably would not benefit much from the creation of a prenup agreement. Even though the topic of prenuptial agreements is often in the news related to high-profile celebrity divorces, the truth is that only a very small percentage of couple actually go through with the process. If you think you might benefit from a prenuptial agreement, you would be well advised to consult with your attorney before taking any steps on your own.

 

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