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What is a Prenuptial Agreement?

Published at May 1, 2019 by administrator.

Prenuptial agreements might not inspire romance, but they’re highly practical and can help couples think through the financial implications of tying the knot. So, what is a Prenuptial Agreement? Let’s talk about what the agreement covers, who might need one, how to make sure it’s legally binding, and when an attorney can help.

What is a Prenuptial Agreement?

A prenuptial agreement is a written contract created by two people who plan to marry. In brief, the agreement lists the property and debts of each person and specifies their property rights in case of divorce. It’s important to note that the courts will not allow for any provisions related to child custody, support, or visitation.

Although the term prenuptial agreement is common, the state of Florida calls them premarital agreements. Couples can also create an agreement during the marriage, rather than before. This is known as a postnuptial, postmarital, or marital agreement. The purpose is the same; the only difference is the timing.

Do I need a Prenuptial Agreement?

Although prenuptial agreements are often associated with the rich and famous, there are many valid reasons that the average person might consider one. With couples marrying later (and multiple times), there’s more legal complexity than ever.

You Need to Clarify What is Individual and What is Marital Property

Florida is a “community property” state, which means upon divorce, your spouse has the right to a 50/50 split of all marital property. If you’d prefer a different arrangement, you can define this within a prenuptial agreement. This is particularly important if:

  • You make significantly more than your spouse
  • You make significantly less than your spouse
  • You and/or your spouse own a business
  • You (or your spouse) plans to stay at home with children (affecting career prospects)
  • You (or your spouse) has a retirement plan in their name only

You Need to Protect Yourself from Your Soon-to-be-Spouse’s Debts

If your future spouse has significant debts, you may want to protect yourself. Creditors can go after the marital property even when one spouse is the debtor. To avoid this, you can clearly state that you’re not liable for any debts incurred by your spouse in his/her name, either before or after marriage.

You Want to Provide Inheritance for Children from a Previous Marriage

Many couples entering into a second marriage want to ensure that their children from their first marriage will receive a specified portion of their inheritance – whether that’s a family heirloom, property, or financial assets. You can lay this out in a prenuptial agreement to protect their rights. However, it’s important to also create and secure other documents such as wills and living trusts.

With many couples marrying later in life, they have more individual assets like homes and businesses. It’s important to designate what is individual property and what is marital property. Otherwise, your spouse has a right to a 50/50 split in the event of a divorce.

What’s included in a Prenuptial Agreement?

A standard Prenuptial Agreement outlines how you will split your assets, wealth, and debt after a divorce. However, you should customize your agreement to your needs. Here are some examples of terms:

  • In what way you’ll identify marital property from separate property
  • How you’ll handle retirement, investment, or business assets
  • Which spouse will continue living in the marital home, and who’s responsible for paying the taxes, insurance, and mortgage
  • If each spouse is responsible for the other’s student loans

It’s up to you how detailed you want to be. Some couples choose to include language that prevents either spouse from making derogatory remarks about the other on social media. Other might specify who retains custody of any pets. It’s a personal decision.

What makes a Prenuptial Agreement legally binding?

In the state of Florida, prenuptial agreements are governed by Title VI-Chapter 61 of the Florida Statutes. In summary, the agreement must:

  • Fully disclose the income and assets of both parties
  • Be entered into freely
  • Is to Be made in writing and signed by both parties
  • Allow each party time to review the agreement and with the assistance of legal counsel
  • Is to be notarized by a certified notary public
  • Be followed by both parties

The Statues are fairly open in terms of what can be included in a prenuptial agreement. They state, “Any matter, including their personal rights and obligations, not in violation of either the public policy of this state or a law imposing a criminal penalty.” In other words, anything that’s not illegal or unreasonable. They also point out that the right of a child to support may not be adversely affected by the agreement.

To be legally binding, a prenuptial agreement must be entered into freely by both couples. It also must be notarized by a certified notary public

Can a Prenuptial Agreement be challenged?

The short answer is yes. However, it’s not common. The Florida Statutes also provide guidance in this area.

They want to see proof that:

  • A spouse did not execute the agreement voluntarily.
  • An agreement was a result of fraud.
  • The agreement was the result of duress, coercion, or overreaching.
  • One spouse was not provided a fair and reasonable disclosure of the property or financial obligations of the other party.
  • The spouse did not voluntarily and expressly waive, in writing, any right to disclosure of the property or financial obligations of the other party before the disclosure was provided.
  • A spouse did not have or reasonably could not have had, an adequate knowledge of the property or financial obligations of the other party.

Do I need an attorney to prepare a Prenuptial Agreement?

There are certainly Prenuptial Agreement templates online, but working with an attorney has a few benefits you may want to consider.

  • An attorney can advise if the terms of the agreement are unreasonably unfair to one party or have provisions that are not permitted (and would not hold up in court).
  • A lawyer with expertise in Florida state marriage laws can help you create an agreement that takes any state-specific issues into account.
  • If both parties have lawyers, neither can argue later that he or she didn’t understand the terms of the agreement (and have an opening to challenge the agreement).

Although no one wants to think about getting divorced as they approach their wedding day, prenuptial agreements also go a long way in reducing the cost, length of time, and frustration of divorce. You’ll have most of the decisions already in writing, at a time when trust isn’t an issue.

If you’re considering a prenuptial agreement, let us put our experience to work for you. We can help you draft a solid agreement that protects both of you. Contact us for a consultation.

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