In this day and age, everyone is looking for a way to safeguard their assets. It’s no wonder that prenuptial agreements are becoming more popular. A prenuptial agreement (prenup) or premarital agreement is a contract that a couple sign before they get married that lays out how the property will be divided in the case of divorce.
Why sign a prenuptial agreement?
Apart from safeguarding your assets, prenuptial agreements can also serve other functions. For instance, they can protect you from the debts of your spouse and determine how the property will be divided in the case of a spouse’s death.
Prenuptial agreements have also been known to protect the inheritance rights of children and grandchildren from previous marriages. Another advantage that comes with such a contract is that it can be used to outline the financial responsibility of each party.
It also protects any personal business or professional practice that you come into the marriage with from being divided upon divorce.
Disadvantages associated with prenuptial agreement
The biggest disadvantage of signing a prenuptial agreement is that you may not be able to inherit anything from your spouse in case they die. You also won’t be able to claim any profit your spouse’s company will experience due to your contributions.
Another thing that needs to be taken into consideration is the fact that in the early stages of engagement a spouse can be so in love that they may agree to terms that may not be in their best interests only to regret later on.
A more immediate negative effect of signing a prenup is the general sense lack of trust it creates within the marriage.
When is a prenuptial agreement taken to be invalid?
This agreement is considered invalid when there is no written form of the contract, it is not signed before the wedding, a spouse was pressured into signing it, or he/she didn’t read it. Invalidity also comes about when a spouse is not given adequate time to review the document before signing it, or they hide some pertinent information.
Another ground for invalidity is the lack of independent counsel for any of the parties.
Alternatives
If you don’t desire to sign a prenuptial agreement but still want to protect yourself, you have options. You can instead decide to get domestic asset protection trusts. Either way, you will need to get yourself a good lawyer who will ensure that your best interests have been put into consideration.
source http://www.winterwoodlodge.com/prenup/
