If you’re an avid US Weekly or E! News reader, you’re certainly familiar with celebrity prenups. When a couple is getting married or divorced, there is speculation on whether they have a prenup and what it might contain. Essentially, a prenuptial or premarital agreement governs each spouse’s rights and responsibilities in the event of a separation or divorce. It can also govern rights related to inheritance. While these agreements are often associated with the wealthy, they can be very beneficial to others as well.
For example, anyone entering the marriage with assets or debts may want to have an agreement in place to outline how those will be handled in the event of a divorce. Generally speaking, in Pennsylvania, premarital assets are not subject to equitable distribution, but any increase in value of those assets would be divisible. That would mean if you owned a house before you got married and it was worth $100,000, and when you got divorced it was worth $150,000, your spouse would have an interest in that $50,000 increase. A premarital agreement can provide alternatives to this legal framework.
Premarital Agreements can also address how jointly acquired property will be divided. If you and your spouse purchase a home together during the marriage, you can specify how it will be divided if you end up separating. Another item that can be addressed is alimony or spousal support. Having a valid agreement in place can streamline a divorce process and keep costs and expenses down in the event of a separation.
Every couple is different and one of the benefits of a premarital agreement is that it can be drafted to meet your exact needs. Maybe there are only one or two specific issues you want to address and you’re willing to handle the remainder down the road. Or perhaps you have a very specific plan for how assets and debts will be divided, if necessary. The agreement can be customized to fit your goals.
Many couples think prenups are a dirty word because they assume marriage will end in a divorce. This couldn’t be further from the truth. A premarital agreement doesn’t mean the parties don’t value the marriage or intend for it to be successful, it is simply a tool to eliminate potential conflict in the future. Discussing and negotiating an agreement can help couples understand their respective finances, contemplate future spending, and be on the same page regarding their income, assets and debts. These agreements provide security for all parties and eliminate the unknown if there would be a separation.
Anyone preparing for marriage should talk to an experienced attorney to determine if a premarital agreement is right for you. We want to help you to better understand how these agreements could benefit you moving forward. Contact BOK Law & Mediation Services for a free consultation!