When compared to cake cutting, vows, and first dances, divorce might not—at first glance—seem like the most natural follow up on a wedding planner’s agenda. Even still, that’s exactly what many couples are doing these days: making divorce part of their wedding (so to speak).
In a recent poll, more than half of the attorneys surveyed reported a significant increase in prenuptial agreements between soon-to-be-married couples. These numbers were strongly supported by millennials, who were on the lookout for ways to protect careers and investments against the possibility of future divorce.
But what is a prenuptial agreement? And how can it be used to help you?
Here’s all you need to know about prenuptial agreements in Texas, and why you should strongly consider making this contract a part of your wedding planning agenda.
Prenuptial Agreements: The Basics
A prenuptial agreement (or “prenup” as it’s commonly shortened to), is a pre-marriage contract between partners that outlines things like property division, debt distribution, and alimony, in the event of future divorce. They can also be used to classify property or dictate responsibilities while the couple is actually married (within certain limitations).
In days gone by, prenuptial agreements were usually only utilized by couples who had a large financial disparity between them (in order to protect the assets of the wealthier spouse). However, in the modern era, those stigmas are all but gone.
Rather than being viewed as an unromantic gesture of a marriage’s inevitable doom, prenups are becoming increasingly popular by normal, average income couples all across the country. Individuals who have watched countless loved ones devastated by the financial ruin of divorce, and who see prenuptial agreements as a way to protect themselves against the possibility of that fate.
Kind of like insurance.
What a Prenup Can Do for You
So, what can a prenup do for you?
Well, a lot, actually. But most of the protections we see can be grouped under the umbrella of “property and finances.” And here’s why.
The Community Property Conundrum
Texas is a community property state. This means that anything acquired by either spouse after marriage—be it a paycheck, credit card debt, or winning lottery ticket—belongs to both spouses equally (regardless of whose name it’s in).
The logic behind community property is sound. These laws ensure that both partners equally benefit from the marriage, and suffer the same hardships if they get divorced.
This “what’s mine is yours” mentality ensures individuals are entering the marriage partnership for the right reasons. Unfortunately, if they ever divorce, it also has the potential to cause catastrophic ruin to a personal business, detrimentally affect the inheritance rights of children from another relationship, or even divert a treasured heirloom outside family lines.
So how do we solve these issues? Is the solution to simply avoid marriage altogether? Fortunately, that’s not necessary.
Enter: the prenuptial agreement.
In order to shield themselves against all those financial doomsday scenarios, prenuptial agreements are often used to:
- Keep accounts, property, and future earnings separate;
- Prevent you from inheriting the debts of your spouse;
- Protect a personal business, retirement account, or other investment;
- Ensure that children from another relationship are provided for, and that their finances are not detrimentally affected by your divorce;
- Safeguard prized family heirlooms;
- Stipulate conditions on future alimony (or “spousal maintenance”); and even,
- Outline who gets to keep the beloved family dog, if the couple ever splits.
Recently, some savvy couples have even begun using prenuptial agreements as a way to control what can and can’t be posted on social media. This might sound odd, but when you think about how one bad post has the ability to ruin careers and eliminate potential job offers, it starts to make a whole lot of sense.
What a Prenup Cannot Do for You
While prenuptial agreements can be used to cover a wide range of business, property, and financially relevant topics, there are a few things they cannot do.
According to the Texas Family Code, a prenuptial agreement cannot:
- Dictate the amount and frequency of child support;
- Decide child custody and visitation;
- Require sexual acts;
- Reference reproduction, such as the number or frequency of children the couple is required to have; or,
- Induce either party to engage in criminal behavior.
Contracts that reference any of these things run the risk of being either partially or wholly invalidated by a judge, upon divorce.
Furthermore, unlike other contracts, a prenuptial agreement does not have to be made in consideration of anything. However, it’s important to note that both parties do need their own attorney. Prenups executed without proper representation on both sides are likely to be declared “unconscionable” (and thus, unenforceable).
How to Execute a Valid Prenup
Couples who want their prenuptial agreement to stand the test of time should take care to ensure their contract is:
- A full representation of all financial information;
- In writing;
- Fair to both sides;
- Voluntarily signed by both parties;
- Executed “in contemplation of marriage”; and that it is,
- Finalized prior to marriage.
That last point is critical. A prenuptial agreement that is signed after “I do”—even if on the same day—is not valid.
On the bright side, if, at any time, your engagement falls through, you don’t have to worry about retracting your prenup. The terms of an otherwise enforceable prenuptial agreement will not employ, if you never actually make it to the altar.
Since prenuptial agreements must be executed prior to marriage, couples who have already tied the knot are out of luck. You cannot go back and retroactively apply a contract to your partnership. However, that doesn’t mean you don’t have options.
Already married partners who want to draft an agreement between themselves can do so through a postnuptial agreement. These contracts operate very similar to a prenuptial agreement, and have many of the same restrictions and requirements.
If you and your spouse are interested in entering into one of these post-marriage contracts, a Neal Ashmore attorney can help you draft an agreement that meets your needs.
Prenuptial Agreement Attorneys in Texas
The worries that plague newly engaged couples are real. Love and trust are risky endeavors, and marriage, a gamble. However, the future of your financial security doesn’t have to be one of those uncertainties.
At Neal Ashmore, our team of experienced attorneys are ready to help you draft a prenuptial agreement that addresses your unique concerns. Call us today at (972) 436-8000, or schedule a consultation online, and together, we can help you enter the next phase of your relationship armed with the peace of mind you deserve.