Purpose of a Prenup– When you are a soon to be married couple deeply in love, nothing can bring that happiness to a screeching halt quite as fast as discussing the matter of a prenuptial agreement. Those little documents ignite feelings of mistrust and panic and most likely raise the defenses. But, prior to you spiraling too far out of control with those emotions, it’s critical to sit back, do a little deep breathing, and take a closer look at why there are prenups.
What is a Prenuptial Agreement?
A prenuptial agreement is a contract created by an unmarried couple prior to getting married that enables them to select and control a lot of legal rights obtained upon marrying, and what occurs to those rights if the marriage terminates by divorce or the passing of a spouse.
According to Nolo, “A prenuptial agreement (“prenup” for short) is a written contract created by two people before they are married. A prenup typically lists all of the property each person owns (as well as any debts) and specifies what each person’s property rights will be after the marriage.”
What is the Purpose of a Prenup?
Having knowledge of a prenup is the first step to comprehending a prenups purpose. The most straightforward way is to look at its applications. It’s essential to recognize they don’t inevitably have to do with divorce but can address the passing of a spouse also. Some of its applications are:
- Safeguarding assets you have amassed prior to getting married, and detailing what you want done with them. For instance, you might want to pass them down to children you had from a prior relationship. Or maybe you are impassioned with a charity and want your assets handed over to them.
- You can define several things having to do with finances. Things such as which debts are owed by which party, or what part of funds are owned by the individual, and which will be shared jointly by the spouses.
- A prenup can designate the manager of financial details and management of assets.
- A prenup may have a spouse waive their right to your retirement plan and designate a different beneficiary.
- A prenup is a precaution when there is a big age or financial difference. Thereby enabling a party to have control of the distribution of the assets they’ll bring into the relationship.
Decoding Prenuptial Agreements: Financial Planning and Peace of Mind
The Myths Besieging the Purpose of a Prenup
Some myths besiege prenuptial agreements and its purpose. A lot of people think it means one spouse already plans for divorce, or that they don’t trust the other spouse.
In reality, they’re putting a lot of faith in their partner by openly discussing their concerns and worries. By putting all of it out there, they are stating, let’s work this out together.
An additional myth is that talking about a prenup will wreck the relationship. In a lot of cases, each party walks away pleased with the agreement, and the strength it gives their relationship. It says we want to talk about the difficult matters and be straightforward about what we wish.
OgborneEngaging, Michelle N. “What Is the Purpose of a Prenup?” Ogborne Law, PLC, 3 Apr. 2020, ogbornelaw.com/purpose-of-a-prenup/.