What Is A Prenup And How To Incorporate It Into Your Estate Planning

What-Is-A-Prenup-And-How-To-Incorporate-It-Into-Your-Estate-Planning

Do you know about prenups? A prenup, formally known as a “prenuptial agreement,” is a contract entered into before marriage wherein the parties can lay out how their assets will be distributed in the event of their death or a termination of the marriage. The agreement is called a “postnuptial agreement” if the contract is entered into during the marriage. Prenups may have a bad reputation because many people believe that by entering into the agreement you presume there will be a divorce before you even get married. Couples who marry later in life, however, and who have children from prior marriages, or have accumulated significant independent wealth or assets, can greatly benefit from the use of a prenuptial agreement to define what assets are to be treated as marital property and what assets are to be treated as separate property. This may not only be useful in the event of a divorce, but it can have the added estate planning benefit of assisting in determining how the assets in the estate should be distributed when a spouse dies.

 

Did you know that most states have laws that do not allow you to write your spouse out of your will? There may be a few reasons why that could be problematic for you and your family.  For example, if you have children from a prior marriage, and you want them to be the beneficiaries of your estate when you pass, many states may not allow you to distribute all of your assets to your children. Many states give spouses the right to elect to disregard the will and inherit a portion of the estate as determined by the state’s law. By using a prenuptial (or postnuptial) agreement in conjunction with your will, however, you can help ensure that your wishes to leave all of your assets to your children are given effect.

 

We can help you to determine whether incorporating a prenuptial agreement into your estate plan is the right way for you to protect your assets and your family. Please contact our office today to schedule an appointment.