A common misconception is that a prenuptial agreement is only for the rich and famous, however, this is simply not true. While it is certainly not the most romantic part of your wedding planning, any unwed couple can elect to form a prenuptial agreement not only to protect what they have prior to the marriage, or in some cases, protect any future assets they should acquire during the marriage. The purpose of the agreement is not to promote divorce, but instead provide much needed transparency to each party’s rights and obligations during and after marriage.
Regardless of how many assets you have entering a marriage, the most important distinction a prenuptial agreement provides is the ability to define what the couple consider to be separate vs martial property. Under New York Divorce law, this definition is created for you. However, couples often wish to create their own definition in order to protect premarital assets that could later be found to be marital in nature thus complicating asset division. If you and your spouse are planning on sharing funds or buying property together once you are married, you could be unknowingly confusing and complicating your separate property interest. These actions could potentially turn your separate assets into martial assets, essentially cutting them by as much as fifty percent in the event of a divorce. This could be devastating for either spouse, as the sudden loss of finances and property, or sudden gained responsibility for assets and property and perhaps associated debt, can have life-altering consequences.
Common reasons for these agreements include premarital business interests where other business partners’ rights could be affected; trust instruments created and contributed to during marriage; or a residence owned before marriage, which will serve as the marital home to which the parties will be contributing their physical and financial resources.
Also, many people are unaware that, even if you or your spouse (or both) enter a marriage with no assets, future assets obtained during the marriage can be self-defined as well with a prenuptial agreement. In New York State, martial assets include assets acquired during the marriage such as like your house, personal property (cars, boats, furniture, etc…), and bank/retirement accounts. It is only natural that you may want to protect that which you earn during your marriage. Love and financial stability are not mutually exclusive. A prenuptial agreement can make sure various property gets classified as separate property, not subject to division if there were to be a divorce.
In New York State, there are a few conditions that must be met in order for these agreements to be fully valid and enforceable. Those being:
• the agreement must be written and duly verified and signed voluntarily by both parties;
• both parties must be at least eighteen years old and of sound mind; and
• the terms of the agreement must be fair to ensure proper enforcement.
It is also important to understand that these agreements are not set in stone once they are signed if both parties agree to amend or waive certain portions of the agreement.
Overall, there is more to a prenuptial agreement than the assets you have coming into a marriage. Getting married can and will have a dramatic impact on your life, and only by being thorough and transparent with your agreement can you ensure that your assets will be protected and distributed properly.