Prenups can be a great tool for couple to use if they are thinking of getting married. A prenuptial agreement can help you establish the financial rights of you and your spouse in unfortunate event of a divorce including protecting a family business, or securing your personal assets. However, prenups have to be done right in order to be valid in your state. Reasons Why A Prenuptial Agreement Might Be Invalid• No Written Agreement: Premarital agreements must be in writing to be enforceable. • Unconscionability: It’s true that you can agree to give up your right to inherit from your spouse, which you would otherwise be entitled to do upon your spouse’s death, even if he or she left you out of a will. You can sign away your right to spousal support if you should end up in divorce court, even if your spouse makes ten times as much money as you do. You can even agree that your spouse gets all of the property and you get all of the bills, if that is what you want to do. But if the agreement is so grossly unfair that one party would face severe financial hardship while the other prospered, the court is unlikely to enforce it. Basically, “unconscionable” contracts are generally found invalid, and premarital agreements are no exception. Premarital Agreements Protect Your Estate in Utah, an Equitable Distribution StateUtah is an equitable distribution state. This means that in the absence of a premarital agreement, all property acquired during marriage (with certain limited exceptions) is marital property and would be subject to an equitable distribution upon divorce. A prenuptial agreement can override that presumption if it is stated in the agreement. Prenuptial agreements can also make agreements regarding potential spousal maintenance, division of assets, and division of debt. It is important to contact a lawyer who understands the complexity of these agreements, and who is familiar with the requirements for a valid prenuptial agreement in order to ensure any agreement reached is appropriate and legally valid. It is also important that each party either be represented by counsel, or be given the opportunity to consult with counsel. Prenuptial Agreements Protect Assets and Investments Even After MarriageAt times it becomes necessary or appropriate to define or negotiate agreements regarding property rights during marriage. Postnuptial agreements may be helpful if, for instance, one party to the marriage is starting a new business with several partners and the partners need clarification on the ownership rights. Both prenuptial agreements and postnuptial agreements, if they have been done properly, make the eventual process of the dissolution go much more smoothly as many of the issues have already been defined. Some Pros and Cons of Prenuptial AgreementsPros The Importance of a Prenuptial AgreementWe live in a culture where marriages are not always “till death do us part.” Although most engaged couples imagine that their marriage will be a lifetime of shared bliss and cooperation with finances, the truth is that approximately 20 percent of marriages end within five years and more than 30 percent end within 10 years. This is why it is important to consider all possibilities for the future before you get married You need to protect the assets you held prior to entering the marriage and assert your right to certain assets you and your spouse procure during the marriage. If you have a child from a previous relationship, it is also critical that you protect his or her right to your assets through a prenuptial agreement. A prenuptial agreement is a lot like a homeowner’s insurance policy – although you hope you never have to use it, it can be a lifesaver if you do. What Can a Prenuptial Agreement Do?In short, a prenuptial agreement sets rules for the court to follow regarding each party’s interests in the couple’s marital assets in the event of a divorce or one partner’s death. Without a prenuptial agreement in place, the court divides a divorcing couple’s assets according to the principle of equitable distribution, which states that each partner may receive a share of the marital property in accordance with his or her contributions to the marriage and his or her financial and personal needs following the divorce. By setting these rules, a prenuptial agreement can do the following: • Ensure that an individual’s children from previous relationships receive their share of his or her assets after his or her death; What May be Included in a Prenuptial Agreement?Issues related to finances and shared property may be included in a prenuptial agreement. In addition to the benefits listed above, a prenuptial agreement can also state how a couple may spend their money after marrying. This can include a clause stating whether one partner may be required to pay for the other’s education expenses or whether the couple will open shared bank accounts. Some issues cannot be predicted ahead of time and, thus, cannot be included in a legally-binding prenuptial agreement. For example, any requirements related to the couple’s future children, such as how many children to have and their custody agreement in the event of a divorce, may not be part of a couple’s prenuptial agreement. Although it is not permissible in many states, you can waive your right to seek spousal support following a divorce. What a Prenuptial Agreement Cannot IncludeIt is important to know the limits of a prenuptial agreement because a section that crosses those limits may invalidate the entire agreement. First, you should remember that a prenuptial agreement is essentially a financial arrangement. It shouldn’t extend to your relations with other family members, your decisions about whether and when to have children, or who is expected to do certain errands. Also, no prenuptial agreement can give either member of the couple an incentive for divorce. This means that you should think twice before making a specific arrangement on how to divide property after divorce that appears to clearly favor one spouse over the other. Prenuptial agreements cannot place restrictions on child support, child custody, or any other rights regarding children of a marriage that ends in divorce. Some states go further and prevent these arrangements from including waivers of alimony, or spousal support. Not every state has this rule, so you should consult with an experienced family law attorney in your state if you are considering this option. Pre-Marital and Post-Marital AgreementsCouples planning to get married may consider making a prenuptial agreement. This document, which is also called a premarital agreement, outlines the property owned by each of the future spouses and the property rights available for each spouse if the marriage ends. Sometimes couples will make this type of agreement after getting married, when it is called a postnuptial agreement. Many couples appreciate the financial clarity that this arrangement can provide, as a valid prenuptial agreement can reduce conflict when a marriage ends in divorce or death. If you choose not to make a prenuptial agreement, your property will be divided according to the laws of your state, which may not produce an outcome that satisfies you. Making a decision about what to do with your property beforehand allows you to avoid uncertainty and the possibility of disappointment. As a preliminary matter, it is often good to talk with your spouse and write down some of your thoughts about certain assets you own and what you would want to happen to them should your relationship dissolve. In some cases, you and your spouse may be able to write the first draft of a prenuptial agreement before consulting a lawyer. Once you have settled on an arrangement with your spouse and drafted an agreement, you should still consult with a lawyer to check that it is valid and give you any relevant advice. When deciding to prepare a prenuptial agreement, many couples may decide to retain individual counsel to ensure they fully understand what rights they may be surrendering. While hiring two sets of lawyers will increase legal fees, having your own lawyer ensures that your interests are fully protected and not compromised by any potential conflicts of interest. Before a court will enforce a prenuptial agreement, it will seek to determine whether the agreement is written, clear and fair. The court will consider many factors, including whether the parties adequately disclosed their finances, were each represented by legal counsel, and voluntarily entered into the agreement free of coercion. The court will also look at the terms of the agreement to see whether the agreement is fair, and not one-sided or unconscionable. Who Needs a Prenup?Contrary to popular opinion, prenups are not just for the rich. While prenups are often used to protect the assets of a wealthy fiancé, couples of more modest means are increasingly turning to them for their own purposes. Here are some reasons that some people want a prenup: If You Don’t Make a PrenupIf you don’t make a prenuptial agreement, your state’s laws determine who owns the property that you acquire during your marriage, as well as what happens to that property at divorce or death. (Property acquired during your marriage is known as either marital or community property, depending on your state.) State law may even have a say in what happens to some of the property you owned before you were married. Under the law, marriage is considered to be a contract between the marrying couple, and with that contract comes certain automatic property rights for each spouse. For example, in the absence of a prenup stating otherwise, a spouse usually has the right to: Making a Valid PrenupAs prenuptial agreements become more common, the law is becoming friendlier toward them. Traditionally, courts scrutinized prenups with a suspicious eye, because they almost always involved a waiver of legal and financial benefits by a less wealthy spouse and they were thought to encourage breakups. As divorce and remarriage have become more prevalent, and with more equality between the sexes, courts and legislatures are increasingly willing to uphold premarital agreements. Today, every state permits them, although a prenup that is judged unfair or otherwise fails to meet state requirements will still be set aside. However, because courts still look carefully at prenups, it is important that you negotiate and write up your agreement in a way that is clear, understandable, and legally sound. If you draft your own agreement, which we recommend, you’ll want to have separate lawyers review it and at least briefly advise you about it otherwise a court is much more likely to question its validity. How to File a Prenuptial Agreement• Prenuptial agreements were once thought to only be used by wealthy individuals. With divorce rates at an all-time high and relationships often consisting of two working individuals, all that has changed. Prenuptial agreements are now seen as a practicality and are therefore more commonplace. Creating an agreement can save both parties from undue stress, complications and lengthy court battles if a divorce comes at some point in the future. No one likes to think of divorce before the white dress has even been fitted, but considering all future possibilities is a smart move for everyone. Requirements for A Valid Prenuptial AgreementYou don’t have to visit an attorney to draft a Prenup Contract, but Prenuptial Agreements must be in writing to be legally valid. It is in your best interest to use a Prenuptial Agreements form that has been reviewed by an attorney rather than creating one completely from scratch. Many individuals utilize online Prenuptial Agreements legal forms as the basis for drafting their agreements. The agreement cannot be unreasonably unfair to one of the parties. If you are planning to get married and are considering a do it yourself prenup, it is a good idea to look at sample Prenuptial Agreements forms to get ideas about the types of information typically included in these legal documents. Prenup LawyerWhen you need a prenup lawyer, please call Ascent Law LLC for your free consultation (801) 676-5506. We want to help you.
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