Typically, and quite pointedly, prenuptial agreements were for couples dealing with financial inequality, couples who have a lot of wealth, or otherwise for couples marrying for the second or third (or more?) time. And, while those couples are quite right to at the very least explore the "prenup" avenue, prenuptial agreements can be a positive 'building exercise' in nearly every soon to be married couple's relationship regardless of financial status. Prenuptial agreements put all of their financial cards on the table before they walk down the aisle, allowing them to preemptively deal with a usually touchy subject before there's "no turning back."
A prenuptial agreement is a signed and notarized contract that spells out how a couple will handle the financial aspects of their marriage. This is especially useful in so-called 'Community Property' States like Texas. With some exceptions, Texas law states that property accumulated during a marriage is owned by both the husband and the wife, each owning a 1/2 undivided interest, hence community property. Additionally, Texas law creates a strong presumption that all property within a marriage is community property, unless it can be satisfactorily proved otherwise.
This is where even the mere discussion of a prenuptial agreement can be helpful in many, if not all, marriages. Although not very romantic, having this honest financial discussion prior to a wedding ceremony can be a very positive experience. That isn't to say that prenuptial agreements themselves are for everyone, just that the discussion shouldn't be avoided for the sake of some misguided sense of morality or stubbornness. Let's take a look at some of the pros and cons of prenuptial agreements:
Pros of Prenuptial Agreements:
- Financial matters need to be faced eventually, why not now?
- A prenuptial agreement puts financial expectation on the table before the wedding.
- A prenuptial agreement spells out which assets a spouse may want to give to children or other family members in the event of death.
- Prenuptial agreements can preserve family ties and inheritance.
- Personal and business assets accumulated before your marriage are protected without an further documentation.
- If your future spouse won't sign a prenuptial agreement, it may be best to discover this before the wedding.
- The financial well-being of children from a previous marriage can be protected.
- In the unfortunate event of a divorce, a prenuptial agreement eliminates battles over assets and finances.\
Cons of Prenuptial Agreements:
- Prenuptial agreements are unromantic.
- Prenuptial agreements can give the appearance that there is a lack of trust between the partners.
- A prenuptial agreement unilaterally forced on one partner by the other could create resentment between spouses.
- A prenuptial agreement can make it seem like there is a lack of a life-time commitment to one another in the marriage.
- Prenuptial agreements can be set aside for failure to fully disclose all assets, or if there is evidence of fraud, duress, unfairness, or lack of representation at the time of signing the agreement.
Should you decide to go forward with a prenuptial agreement, here are some things to remember:
- Discuss the agreement early in your relationship; don't wait until you're ready to walk down the aisle.
- Be completely honest with each other; don't try to hide your thoughts, feelings or your assets.
- Although not strictly necessary, try to hire separate attorneys so you are both equally represented.