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Prenups—Not for Just the Wealthy

Posted by Deena Tootle | Aug 20, 2021

If you plan to get married, is a prenup right for you? If you are already married, is it too late to get a prenup? If you already have a prenup, what should you do now? A prenuptial agreement, or prenup, is a legal contract signed by couples prior to marriage that can resolve issues of property division and spousal support if the marriage ends by divorce or death of a spouse. Division of property can include everything from debts to family pets. While financial conversations imagining your much anticipated marriage failing are not very romantic, even less romantic can be the results of not having an agreement regarding such issues, such as paying off your ex-spouse's debt from which you received no benefit, taking a pay cut when reentering the workforce after taking a leave of absence to care for children, losing a business you built from the ground up, or being sued by your spouse's children from a prior relationship.

Planning for divorce may be difficult to discuss with your partner. Some people believe there is a stigma associated with planning for failure, while others see it as a way to prepare for the unknown, like planning for death using a will or other estate planning document. Planning ahead for potential divorce is not irrational. Despite the fact that divorce rates in the U.S. have decreased over the last decade (2019 data from U.S. Census Bureau), a marriage ending in divorce will still become a reality for many couples. While the conversation of divorce may be difficult, having a prenup could prevent future financial surprises by disclosing all assets and debts of each person prior to marriage. Also, having uncomfortable conversations with your partner prior to marriage could help improve communication when future difficult situations arise during your marriage.

In Texas, generally, when one spouse files for divorce (or a spouse dies), all property owned by the spouses is presumed community property unless otherwise proved to be separate property. Separate property can include, but is not limited to, property owned by one spouse prior to marriage or property received by one spouse via gift, devise, or descent. Also, during a marriage, separate property can be converted to community property, even without the spouses' intent. (Conversion of property is a complex legal concept that should be discussed with an attorney.) Without agreement of the spouses during the divorce process (or beneficiaries during the probate process) as to what is separate property, a spouse (or other beneficiary) will need to prove an asset or debt is separate property by clear and convincing evidence, a legal standard. As you can imagine, a divorce (or probate) becomes more complex and costly when people cannot agree on what is separate property. A prenup can help identify what property is separate upon divorce or death of a spouse.

Prenups can keep separate property separate, convert separate property to community property, convert future community property to separate property, and vice versa. What will work best for each marriage is unique and should be discussed with an attorney. Prenups can also be used to determine spousal support in case of divorce. For example, if one spouse puts his or her career on hold to raise children while the other spouse continues his or her career, then the couple may decide it is fair to provide the caregiver spouse with support in case of divorce. Spousal support is not the same as child support, and it can be difficult to obtain in Texas without prior agreement. Additionally, child support is not spousal support and is not meant to be treated as such. In most cases, child support should not be included in a prenup as it will most likely not be upheld by a court of law.

If you and your soon-to-be spouse decide a prenuptial agreement is right for you, you should expect to hire separate attorneys. This avoids conflicts of interest and gives the agreement stronger legal effect if it is later needed to be enforced by a court of law. Additionally, you should begin discussing and have the prenup prepared and signed as soon as possible prior to your marriage. Finalizing a prenup just prior to marriage can cause later legal issues. Lastly, a prenup should be drafted by an attorney, not by you or an online service using a standard form. Again, every marriage is different, and a prenup that is not customized to you and your marriage could lead to unintended consequences or be found invalid by a court of law.

A prenup has the potential to protect both you and your future spouse. Every marriage is unique, and working with your partner to develop a prenup allows both of you to have a say in what happens in the event of divorce or death. Also, coming to an agreement prior to a stressful situation could make it less stressful. If you are married and do not have a prenup, spouses can create post-marital agreements that have the same effects. If you already have a prenup in place, you should review it with an attorney every few years to ensure it still works for you and your marriage.

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