When people get married, they commit to each other in a way that ties them together not only emotionally but also legally and financially. A prenuptial agreement is a legal contract that couples sign before they get married to predetermine issues around finances and property ownership. Whether to sign a prenuptial agreement is a personal decision that should be well understood by both parties.
Although they may have a negative connotation, prenuptial agreements can be quite helpful if approached in an open and honest manner. Working out details of an agreement can help a couple get on the same page for planning their future. It can help clarify expectations, avoid misunderstandings, and affirm an approach to the relationship based on mutual respect.
A variety of situations make signing a prenuptial agreement advantageous, including if one or both have been married before, have children from a prior relationship, or want to ensure their finances remain confidential in the event of a divorce. People who have been married before may have prior commitments to pay alimony, pay off accumulated debt, and/or maintain a life insurance policy. People who have children from a prior relationship may have commitments to pay for child support, maintain health benefits, and/or pay for college tuition. It is important for another partner without these obligations to appreciate the costs and, if necessary, protect personal assets and income from being used to pay for them. In addition, the parent may want to ensure certain assets will be set aside for the children, including money, stocks, furniture, jewelry, and real estate.
Sometimes a large disparity in wealth or debt holds people back from getting married even if they are in a committed relationship. Rather than remain unmarried, a couple can set out terms to address financial concerns. Examples include when one of the parties:
- Is much wealthier than the other
- Has substantial debt compared with the other
- Does not work and does not intend to work
- Owns the house in which they reside
Terms for addressing wealth disparities can include stating limits on asset distributed in the event of divorce. Terms to address debt can provide for each person to be responsible for their own debt. If one spouse is either giving up a job to take care of children or chooses not to work, details can be set to relieve the non-working person from contributing to household expenses and/or otherwise fairly providing for their welfare.
Other financial concerns may also be included. For example, there may be verbal promises that, if broken, could result in resentments and destabilize the marriage. Although a prenuptial agreement is not where personal decisions outside of finances should be addressed, it can be used to address financial commitments that have been verbalized. Examples include:
- Handling income, deductions, and claims when filing tax returns
- Separating business enterprise income and debt from household finances
- Covering costs of household expenses
- Contributing to savings accounts
- Managing credit card spending and payments
- Providing for property distribution to a survivor, entitlement to retirement benefits, and maintenance of a life insurance policy in the event of death
It is also possible to commit to using methods of resolving conflicts outside of the court system such as using arbitration or mediation.
What Issues Cannot Be Included in a Prenuptial Agreement?
As mentioned, personal issues other than those relating to finances do not belong in a prenuptial agreement. Concerns such as whether the wife takes the name of the husband, details regarding child rearing, and setting limits on family interaction are all off limits. These issues are certainly worth discussing. However, they should be decided and resolved personally and are not appropriate for inclusion in a prenuptial agreement.
There are also limits to what financial considerations can be addressed. Attempts to predetermine limits for child support and child custody of children of the marriage are outside the scope of what a prenuptial agreement can cover. Courts maintain final say in calculating child support and apply the so-called best interests of the child standard in making their determinations. Specifically, courts work to uphold the public policy of maintaining a child’s right to financial support and the right to have a relationship with fit parents.
Can I Be Forced to Sign a Prenuptial Agreement?
The decision to enter into the agreement should be mutual and not involve any sort of coercion.
Prenuptial agreements must be negotiated fairly. Each party should be represented by separate lawyers. It is not advisable to agree to be represented by one attorney even if he or she commits to acting impartially in devising terms. A prenuptial agreement can be invalidated if coercion was used to get one of the parties to sign.
Can I Invalidate My Agreement?
Whereas some states have a specific statute dedicated to prenuptial agreements, Maryland treats handles these agreements no differently than contracts. Case law has evolved to lend some structure to how courts view prenuptial agreements as compared with general contracts. Although the state honors the right of two people in a confidential relationship to contract and enter into a prenuptial agreement, it also tends to invalidate prenuptial agreements if they appear overreaching. The courts consider a procedural prong in regard to the circumstances surrounding the signing of the agreement and a substantive prong in regard to the result of enforcing the agreement.
Bel Air Divorce Lawyers at Huesman, Jones & Miles, LLC, Can Help Negotiate Prenuptial Agreements
In the event divorce makes interpreting and enforcing a prenuptial agreement necessary, the Bel Air divorce lawyers at Huesman, Jones & Miles, LLC, can evaluate the agreement and help clients understand how it impacts their divorce negotiations and terms. Our legal team will answer all your questions and help you through the process. For more information and a free consultation, complete our online form or call us at 443-589-0150. Located in Hunt Valley and Towson, Maryland, we serve clients throughout Baltimore, Baltimore County, Bel Air, Bentley Springs, Columbia, Freeland, Hereford, Hampton, Westminster, Essex, Monkton, Sparks Glencoe, Parkton, Phoenix, Pikesville, White Hall, Carroll County, Harford County, and Howard County.