When, why and how to get a prenuptial agreement, and what to do if
you're presented with one.
As the Dow Jones Industrial Average climbs ever higher, so does the
frequency of prenuptial agreements. These are contracts that engaged
couples use before getting married to stipulate how their property and
cash will be divided in the event of divorce.
Prenups typically surface when the man and the woman aren't on an
equal financial footing, with one party seeking protection from the
litigious ravages of divorce should the marriage fail. Yet prenups are
sometimes deemed necessary by partners of comparable means. For example,
they may want to ensure that records of the family business aren't
exposed in protracted court proceedings. Or, if only one party owns the
business, that individual might use a prenup to keep his or her future
spouse from getting a piece of it in a divorce settlement.
Pulling out a prenup may not be the best way to keep the romance
aglow, but if you feel the need to protect yourself, there are some key
points to bear in mind. Similarly, if you're on the receiving end of
those two distrustful-sounding syllables, you have your own strategic
points to consider.
Here are some of the basics.
- If you're on either end of a prenup, get a lawyer, and get one fast.
Not only do you want to have an attorney, but you want your fiancé to
have one as well. This way, neither party can claim that the other
didn't know what he or she was doing.
- Disclose everything. If you're proposing a prenuptial agreement,
you're probably the wealthier member of the couple, and it's incumbent
on you to disclose all of your property and assets in the agreement. If
you don't, your future ex-spouse's attorney will attack the agreement,
saying his or her client would never have agreed to a given distribution
had he or she known the full extent of your holdings. If you're
presented with a prenup and you want to be protected down the road, ask
your lawyer about including a clause stating that the property listed is
indeed the full extent of your fiancé's holdings.
- Do it early. Not on the second date, mind you, but long before the
wedding day. Often, people will propose prenups after the wedding
bells have begun chiming. The hurried nature of such signing could be
construed as a factor of duress, and hence disallowed in court. Then
again, if you're not the one proposing the prenup, you may want to put
off the signing until the wedding day to give yourself an out.
- The distribution of property shouldn't be so unbalanced as to be
unconscionable, often grounds for being disallowed. So, if you're keeping
the ski chalet in Zermatt and the beachfront house in Cannes, the least
you can do is let the other party have the place in Vermont.
- Videotape the signing. This is done more and more often with myriad
contracts to show that the parties actually did sign the papers
themselves, and that there was no duress involved. If you're on the
receiving end of a prenup, you may want to "forget" to recharge the
Next: Postnuptial agreements