Prenuptial agreements have seen a surge in popularity over the last several years. Prenuptial agreements are particularly advisable for those who have sizeable wealth, own a business, have an expectation of assets from inheritance or a trust, or are entering into a second marriage with significant personal assets.
Prenuptial agreements allow prospective spouses to determine the property rights and financial responsibilities of each party during the marriage, and establish how the property will be distributed and support obligations upon divorce or death. They provide certainty for both parties and protections that go beyond the laws governing the division of assets, including provisions with respect to spousal support, property division, inheritance and other rights and obligations. However, like any contract, prenuptial agreements are subject to challenge in a court of law. Accordingly, it is critical that prenuptial agreements be executed voluntarily and with comprehensive financial disclosure (or an appropriate waiver of such disclosure); that each party engage separate and independent counsel in connection with the negotiation of the prenuptial agreement; that negotiation of the prenuptial agreement begin as far in advance of the wedding date as possible; and that the agreement is fair and reasonable.
When carefully planned and used correctly, a prenuptial agreement can be an equitable way of disbursing assets and responsibilities between prospective spouses.