Amid the excitement and happiness of planning a wedding, you may not want to think about your marriage failing and the consequences of a divorce. But a prenuptial agreement is an insurance policy for your marriage, protecting each spouse’s property rights should the marriage end.
Prenuptial agreements are not just for the wealthy. Anyone who is about to marry and has assets, debt, potential business interests, or children from another relationship may benefit from a premarital agreement. If you are marrying soon, the Alabama prenup attorney Leigh Daniel can discuss what a prenup is and how it could protect you and your spouse. If you need assistance with a prenuptial or postnuptial agreement, Leigh can represent you and work with your intended and their attorney to help craft a solid agreement that meets Alabama’s legal requirements and addresses all of your needs.
What Is a Prenuptial Agreement?
A prenuptial agreement, or “prenup,” is a contract between a couple about to be wed that establishes rules regarding how property will be treated if the marriage ends in divorce. In Alabama, a prenuptial agreement is also called an “antenuptial agreement.” A similar contract executed after a couple’s wedding is known as a “postnuptial agreement.”
Do You Need a Prenuptial Agreement?
None of us truly knows our financial future or how our marriage will play out. A prenup protects what each of you accumulates before and during your marriage. A prenup may also keep you from becoming responsible for your spouse’s debts.
Some common reasons why you might want to consider getting a prenup include:
- One of you is much wealthier than the other
- You bought real estate before the marriage
- This is a second or subsequent marriage for either of you
- You have children from a previous relationship
- You or your partner are in post-secondary school or plan to return to school
- You or your partner has or expects to accumulate a high amount of debt, such as student loans
- You own your own business
- You have employment benefits, such as stock options or profit-sharing
- You have earned more than one year’s worth of retirement benefits
- You expect a substantial inheritance
- You or your partner have estate planning documents that name beneficiaries other than the soon-to-be spouse
What Can Be Included in a Prenup?
You can write a prenuptial contract to establish your rights to property that you bring into the marriage or that you acquire during your marriage in case of divorce. Your prenup can spell out what you and your spouse will keep as your own and/or how other assets or debt will be shared in a divorce. A prenup can also spell out financial responsibilities during your marriage.
Prenuptial agreements can address the disposition of anything related to finances, such as:
- Real and personal property acquired before or during the marriage
- Responsibility for debt acquired before or during the marriage
- Money in education or retirement accounts you accumulated before or during the marriage
- The responsibility for managing household budgets, bills, investments, taxes, etc., during the marriage
- Inheritances expected to go to either spouse and/or children from a previous relationship
- Payouts from life insurance policies
- Assets of a family business that should remain with the spouse from the originating family
The content of a prenup addresses financial issues that could arise in a divorce and explain how they would be handled. A typical prenup example might say the wife will take ownership of the family residence in exchange for other assets that go to the husband. It might say the divorcing couple will split any outstanding credit card debt proportionately according to their respective salaries at the time of their separation. A prenup could specify that an heirloom handed down by one spouse’s family stays with that spouse or a blood-relative child or grandchild.
A prenup settles these issues when each party is in the frame of mind of caring about the other’s welfare. It takes them out of divorce proceedings and away from the heightened emotions of a breakup.
Can Child Support Be in a Prenuptial Agreement?
Alabama law does not permit you to include provisions related to child support or child custody in your premarital agreement. The court makes these decisions after considering what is in the child’s best interests. Additionally, child support is considered the child’s right, so you can’t contract it away.
What Else Cannot Be Included in A Prenuptial Agreement?
There are certain matters that cannot legally be a part of a prenuptial agreement. Prenups are meant to focus on financial issues but cannot stipulate decisions that a judge must decide or validate in a divorce, such as decisions regarding the welfare of a divorcing couple’s underage children.
A prenuptial agreement in Alabama also cannot:
- Establish child custody or visitation rights
- Waive either spouse’s right to alimony
- Require either spouse to engage in or go along with illegal activities
- Establish non-financial personal requirements, such as child-rearing requirements or prohibiting weight gain of a spouse
- Include any provision designed to encourage divorce, such as financial incentives
How to Get a Prenup
A prenup must meet certain criteria, including:
- It must be written. Oral prenups are not enforceable
- Parties to the agreement must get married. A prenup only becomes effective when the parties are legally married
- Each party must enter into the agreement freely, without coercion or duress
- Provisions of the prenup are equitable, meaning each spouse is treated fairly
What Invalidates a Prenuptial Agreement?
A spouse could challenge a prenup in court if it is unfair or was forced upon them. Alternatively, a judge could decide that a one-sided agreement is invalid.
For a prenup challenge to be successful, the complaining spouse would need to prove at least one of the following:
- Coercion, duress, or lack of mental capacity was present when the prenup was written or signed. If a spouse was inebriated when they signed the premarital agreement, they might argue lack of mental capacity. If their fiancé demanded they sign the prenuptial agreement right before the wedding, they might argue duress.
- Their spouse failed to fully disclose assets or financial obligations. Complete transparency about finances and other issues is necessary to ensure a prenuptial agreement is valid. A judge could throw out an agreement if one spouse demonstrated that the other hid assets or substantial debt when entering into the premarital agreement.
- Illegalities in the content or form of the prenup exist. The prenup may include invalid provisions, did not meet requirements, or lacked fairness.
Drafting A Fair and Valid Prenuptial Agreement
As your prenuptial agreement attorney, Leigh Daniel can review a prenuptial agreement you and your intended spouse have drafted or help write an agreement that addresses your unique needs. Each party to a prenup should retain their own prenuptial agreement lawyer to review the agreement and ensure it is fair, equitable, and legally sound.
A couple should begin preparations for a prenup by exchanging full financial information about their finances, including:
- All assets in their name
- Anticipated assets, such as inheritance (trust funds, family home, family business or partnership, etc.), employment-based stock options, etc.
- Debt, including student loans, mortgages, credit card debt, etc.
- Obligations from prior marriage (such as child support or alimony)
You and your partner can discuss how you’ll manage your finances after marrying, the role money plays in your lives, and your financial goals. You can decide whether to keep your finances separate or co-mingle them (joint accounts). If one of you has significant debt, discuss how you’ll pay it. Talk about your expectations if one of you becomes unemployed.
It is not necessary that you and your partner have the same views regarding money. The goal is to understand each other and reach an agreement as to how you’ll manage your differences.
You can review the issues typically covered by a prenup and see where you can agree, such as:
- Each spouse’s separately owned property will remain theirs.
- Each spouse will pay their own premarital debts, or you’ll pay them down together.
- Everyday considerations regarding your finances, such as: how household expenses will be paid, who will pay bills, make investment decisions, pay taxes, etc.?
- What property do you expect to own and how will you buy it, such as the size of your primary home or whether you’ll own a vacation home, timeshare, RV, etc.? This is particularly important if one spouse brings significantly more income or assets to the marriage that might be designated to such purchases.
- What will each spouse expect if one contributes to the other’s education, business, or professional practice? How will each of you share in the future increase in value?
Contact a Prenuptial Agreement Lawyer in Alabama
At Leigh Daniel Family Law, our compassionate and highly skilled prenuptial agreement lawyers are committed to our clients’ best interests. As your prenuptial agreement attorney, Leigh Daniel will protect your financial interests as you develop an agreement and ensure the final contract is appropriate and legally valid. Schedule your consultation today.
