What You Can (and Can't) Do With a Prenuptial Agreement
by Shae Irving & Katherine E. Stoner, Attorney-Mediator
Understand what you can accomplish by making a prenuptial contract before you marry.
If you're trying to decide whether or not to make a prenuptial agreement, you'll need to understand what this type of contract can -- and can't -- do for you.
What You Can Do With a Prenup
Prenuptial agreements are most often used for the following purposes:
Keep finances separate. Every state has laws designating certain kinds of assets accumulated during marriage as marital property or community property, even if these assets are held in the name of just one spouse. If a couple divorces, or when one spouse dies, the marital or community property will be divided between them, either by agreement or by a court. If you want to avoid having some or all of your individual accumulations during marriage divided up by a court, you can do so with a premarital agreement.
Protect each other from debts. Some of us bring debts, as well as assets, to a marriage. If there's no prenup, creditors can sometimes turn to marital or community property to satisfy the debts of just one spouse. But if you want to make sure that saying "I do" does not mean saying "I owe," you can use a prenup to limit your liability for each other's debts.
Provide for children from prior marriages. A prenup is helpful (perhaps essential) if either of you has children from another relationship and you want to make sure that your children inherit their share of your property. In a prenup, one or both spouses can give up the right to claim a share of the other's property at death, perhaps in exchange for an agreed upon amount of property.
Keep property in the family.
If your property includes something you want to keep in your birth family, whether it be an heirloom or a share in a family business, you and your spouse can agree that it will remain in your family, and you can specify that item in your prenup. This can even include property that you expect to receive in a future inheritance.
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