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Basics of Prenuptial Agreements

Posted By Jim On 10/18/2007 @ 10:09 am In Personal Finance | 19 Comments

I’m about to get married in a few months and I’ve actually been asked, on multiple occasions, whether we plan on having a prenuptial agreement (technically a prenuptial accord) and the answer is No (and no I didn’t need to think about it ). We’re in love, we’re happy, we’re planning the rest of our lives together… but that’s exactly why now is the perfect time to discuss/negotiate and sign a prenuptial agreement (though we never really discuss the idea seriously, we just assumed we weren’t getting one).

Why?

Some would say that discussing a prenup is like preparing for failure (it’s a very emotional response and understandable) but then I would argue why does anyone by insurance? I’m not averse to the idea of getting a prenup, it’s just that I don’t see it as necessary and I don’t want to pay some lawyers my hard earned money for something I don’t feel is necessary. Would you pay a dentist to remove your wisdom teeth if they weren’t bothering you? Probably not.

Why Now?

Discussing a prenup doesn’t exactly jazz up relationships, especially when you’re in love (awww!), but right now, right before marriage, is the best time to talk about this sort of thing because now is when things are most cordial. You want to talk about and sign these agreements, like any other business contract, in the best of times because that’s when you and your partner will agree on something. Whether it’s a partnership for a new business venture or something smaller, like a house, having a written understanding of where each person is, what each person believes, and how things are to be resolved should it come to a mediator is crucial.

You Convinced Me! Now How?

Step 1: Agree
So, if you want to get a prenuptial agreement, or a prenup, here’s what you’ll need to do. (Remember, I am not a lawyer so always consult with one, this is just my interpretation from the readings I’ve found online) The first step is to just write down what you two believe in plain English. If you plan on a split where you each take what you brought in and split everything else afterwards, it helps to has those details now instead of when a high priced lawyer is introduced. You don’t need someone (or someones) in a suit sitting there while you draw up the basics of your agreement, you only need them to put it in that high priced legalese to make it stand up in court.

Step 2: Lawyerize It
Then get two matrimonial laywers, one for you and one for your partner, to draw up the specifics in a legal instrument. In some states, you need independent advisers to both sides or it could be see as unfair and nullify the agreement once you hit the battlefield. Lastly, be sure to revise it every couple of years to keep it current and to keep both party’s understandings in play. One of the revisions could be to do away with the prenuptial agreement entirely, so you want to revisit it every so often.

3 Useful Tips

Here are a few more tips about prenuptials I pulled from a Bankrate article [3] on the subject:

  • You can’t waive rights to child support payments (it’s for the children, not for the partner anyway)
  • A will can’t supersede the prenuptial agreement if it’s stingier but it can if it is more generous. If the will gives more than the prenuptial, then it can stand. If it gives less, sorry, the prenuptial stands. This is why it’s important to revise the document, you don’t want a prenuptial from thirty years ago forcing your estate into probate instead of going to your partner (if that’s what you want).
  • Ensure it is signed in triplicate and three copies are made. One going to each party (bride, groom) and one to an independent party such as a lawyer or a safety deposit box.

So, what do you all think of prenups?


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[3] Bankrate article: http://www.bankrate.com/brm/prenup.asp?pid=p:brg

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