Understanding Prenuptial Agreements in California
A prenuptial agreement (also known as a “prenup”) is an agreement a couple can enter into before they are married which determines how the marriage in the event of a divorce.
There is a misconception that prenuptial agreements are only available to those who are wealthy and who have substantial assets. However, there are a number of reasons why a couple may want to get a prenuptial agreement, including:
- Clarifying financial rights
- Giving separate property to children from a prior marriage
- Protecting themselves from their spouse’s debts
- Protecting an owned business
- Avoiding extensive litigation and arguments during the divorce process
Why You May Need a Prenuptial Agreement
From the most wealthy of individuals to couples with limited assets, many can benefit from a prenuptial agreement. A prenuptial agreement will help avoid disagreements as it clearly defines exactly what will happen should a couple choose to end their marriage. Even if you do not believe in divorce today, this may change depending on what happens in the future.
A prenuptial agreement is not romantic, which is why many parties fear or avoid discussing the topic. But a prenuptial agreement does give couples the opportunity to clarify many important issues prior to marriage including money management, responsibility for debts, estate planning and property rights.
The Benefits of a Prenuptial Agreement
There are a number of benefits to having a prenuptial agreement in place:
- If there are children in the home, this agreement can reduce or eliminate conflict between the couple over who gets what after the divorce. This will help ease the burden of your divorce on your children.
- Having a prenuptial agreement will save you money. There will be less litigation involved and less money spent fighting over assets.
- Couples can define what is marital or community property and protect separate property.
- A prenuptial agreement will protect your estate plan.
These agreements also allow couples to establish ground rules for deciding special agreements and future matters.
What Cannot Be Included in a Prenuptial Agreement
There are two key issues which cannot be included in your prenuptial agreement in California:
These two areas will be determined by the authority of the court.
What Happens If You Do Not Have a Prenuptial Agreement
Not having a prenuptial agreement in place means that state laws will determine who acquires what in the event of a divorce or death.
Marriage is considered to be a contract shared between a marrying couple. With that contract comes a number of automatic property rights for each spouse. Some of the most common include:
- Paying debts which the other spouse has incurred throughout the marriage
- Sharing ownership of property acquired during the marriage
- Sharing in the management and the control of communal or marital property (in some instances the couple may be forced to sell the property or give it away)
How to Make a Valid Prenuptial Agreement
Prenuptial agreements are more common today than they ever have been, but the courts still closely scrutinize these agreements. If a prenuptial agreement is deemed “unfair” or does not meet state requirements, it will not be considered in the event of a divorce.
Couples can draft their own prenuptial agreements prior to visiting their attorney. There are a number of worksheets, templates, and other resources readily available online and at the library. In order to make sure that it is clear, understandable, and legally sound in the state of California, however, it is recommended to have it reviewed by a family law attorney.
If a Spouse Dies
A prenuptial agreement is also useful in the event that a spouse passes away. In the agreement you can set specific conditions about different assets and different children. For instance, if you would like to have some assets or property stay within your biological family, or if you would like specific children to receive specific property, this can be included in your prenuptial agreement.
Prenuptial Agreements after Marriage
If you are already married and are interested in entering into a prenuptial agreement with your spouse, you can make an agreement which is known as a “postnuptial agreement”. These agreements allow you to outline the same plans as you would with a prenuptial agreement.
It is also important to note that a prenuptial agreement can be changed after your wedding day. For instance, if your financial situation has changed, you can then alter or modify any terms in the prenuptial agreement as long as:
- Both parties agree to the terms; and
- The changes are made in writing and are signed
A couple may also want to consider updating the terms of the agreement should you move to a different state and/or you become parents.
Why Contact Lavinsky Law
At Lavinsky Law, our goal is to ensure that you have control over your future financial situation. Rather than attempt to navigate the complex set of laws which come with property and asset division in the event of a divorce, we give our clients peace of mind in ensuring that they have a legally sound prenuptial agreement in place which protects both them and their children.
Brighter Days Are Ahead, to discuss your prenuptial agreement with an expert family law attorney, we welcome you to contact Lavinsky Law for a free consultation today at (310) 274-2717.