While no one wants to imagine getting divorced before they’re even married, the sad fact is that many couples who are now madly in love will end up divorced sometime in the future. If you personally own a large amount of property and assets, this could mean losing things that are rightfully yours if you don’t have a solid prenuptial agreement in place. Forbes explains how prenups work so you can determine whether this option is right for you.
Prenups establish property rights
When dividing assets, deciding who gets what property is often hugely contentious. A prenuptial agreement delineates shared and individual property, as well as the terms for dividing property that’s considered shared. This is beneficial to both parties, as it allows them to have tough financial conversations early on.
They also address infidelity
Many couples add clauses to their prenups that address what should happen if infidelity occurs. Some agreements state that the guilty party forfeits any ownership of assets they may have. In other cases, infidelity can also make it impossible to receive spousal support, which is afforded when one spouse shows that his or her lifestyle cannot be maintained without assistance. This component is particularly challenging for new couples to discuss, so be sure communicate openly when going over these areas.
Prenups won’t cover certain situations
When drafting the agreement, both parties must disclose all property and assets in their names. Failure to do so will leave those items out of the agreement, which means their spouse could claim them should a divorce occur. Things like visitation and child custody also cannot be determined by a prenup. This is because those decisions are left to the jurisdiction where they’re occurring. As a result, any decisions made by the court will override those in the agreement.