While they may have a bit of a bad reputation, premarital agreements are a useful tool for couples about to get married. If in the future the couple decides to divorce, the couple has already laid out how they would like their property and debts divided. Without this agreement or an agreement at the time of the divorce, the Court will decide for the couple how their property should be divided. The Judge will decide about what he or she believes to be equitable, which is not necessarily equal. A premarital agreement allows the parties to set out their wishes on their own terms prior to the marriage and possibility of divorce.
Premarital Agreements Have Four Major Benefits
- Asset Protection: If one spouse has significant assets when entering into a marriage, a premarital agreement can ensure that if the couple divorces, those assets will stay with that spouse. This is especially important when one or both spouses have children from a prior marriage and they want to protect assets for their children’s care in case of the parent’s death.
- Financial agreements during the marriage: One spouse may come into the marriage with children for whom they want to pay for college, or travel, or other expenses, or even more expensive, a party may come into the marriage with horses for whom they need to provide shelter and training. A premarital agreement can discuss what funds will be used for these separate purposes and how much, if any, of the marital funds will go toward these pursuits absent an additional agreement of the parties.
- Less Stress: For all couples, going through a breakup or divorce is difficult. If the spouses have already negotiated the terms of the divorce with a premarital agreement, the spouses may focus on other things, such as self-care, care of the children, and moving forward
- Simpler Divorce: Investing in a premarital agreement saves time and money if the couple does get a divorce in the future. If most of the details of a divorce have already been agreed upon, there is less to argue about at the time of a possible divorce. When going through a divorce, saving time means saving money. Lawyers bill on an hourly basis, so the less work needs to be done, the less expensive the overall divorce can be.
In order for a premarital agreement to be valid and enforceable at the time of the possible divorce, the agreement must be written and signed by each party. Each party must be honest about all of his or her assets and debts. Each party must understand the terms, what they are giving up, and enter into the agreement voluntarily. The agreement must, most importantly, be fair. In order to ensure that each of these requirements is met, each party should be advised by their own lawyer.
To draft the premarital agreement, each lawyer will work with the parties to discuss what the parties agree to regarding how their property and debts will be divided. These agreements do not preclude the parties from changing the agreement in the future, but major changes should be written and signed and kept with the original agreement. The skilled family law attorneys at Jorgensen, Brownell, & Pepin, P.C. recommend that couples strongly consider a premarital agreement especially when one spouse earns considerably more income than the other or if one spouse has significant assets or debts when entering into a marriage.
Need some help with a prenuptial or marital agreement? Jorgensen, Brownell & Pepin, P.C. of Colorado is here to be your legal guides! Call us at (720) 809-8310, and get more than 30 years of legal experience on your side.