Prenuptial agreements have a bad reputation. Many people either feel that it is wrong to get one or getting one makes them a ‘gold digger,’ or are unconformable having extensive financial discussions and disclosures before the big day.
Instead, a prenuptial agreement should be viewed as the contract that sets the financial terms of the new business partnership formed by the marriage. Key provisions typically surround spousal support/alimony, the identification of and use of separate property brought into the marriage, and the operation of a separate property business after the marriage. Some provisions like child support limitations and custody provisions cannot be included. Also, the prenuptial agreement cannot be viewed as ‘unconscionable,’ and cannot encourage divorce. Each spouse should have an attorney representing them, and the process needs to be started well in advance of the wedding with specific formalities required by California law.
The reality is that the new marriage will end in one of two ways … either with death or divorce. Trust and estate planning provisions can also be included in the prenuptial agreement with the assistance of an outside trust/probate attorney chosen by the client.
No two marriages are alike. So the default divorce provisions of the Family Code may not fit your marriage. If you are happy with the default divorce provisions provided by California (or the state you divorce in), then do not get a prenup. Some feel that the amount of spousal support ordered under the Family Code is too high, or that spousal support should be excluded altogether. Others want a basis for spousal support from their wealthy spouse who has no ‘income’ or want to prevent spousal support litigation by setting a spousal support amount in the prenuptial agreement (but in a way that does not encourage divorce).
Having financial discussions before marriage is very beneficial to ensuring a successful marriage. And, if it ends in divorce, then the process should be streamlined. A good prenuptial agreement should save the spouses attorney’s fees in the event of a divorce.
I have analyzed many prenuptial agreements that were not worth the paper they were written on, and many which were done without the required formalities of California law. In the event of divorce, a bad prenuptial agreement will likely result in litigation. If you get a prenuptial agreement, make sure you and your spouse hire competent family law attorneys for the drafting and review.
“A prenuptial agreement should be viewed as the contract that sets the financial terms of the new business partnership formed by the marriage.”