Read the Fine Print. Why You Need a Prenup!

You’re engaged.  Congratulations! You and your fiancé are regaling friends and family with details about the magical moment the question was popped, and you are both head-over-heals with excitement about the pending nuptials. Hours will be spent planning the wedding, reception, honeymoon, etc. Everything will be planned to a tee, with the event coordinator on speed dial and the wedding day’s schedule tattooed on your forehead, or at least seared into your frontal lobe. This is an important moment in your life, and you want it to be perfect.  But if you are like most American couples, you and your fiancé may overlook one of the most critical aspects of marriage:  the actual “legal contract” that binds a married couple.

The implications of the marriage “contract” is one of the most overlooked contracts.   This is somewhat shocking, considering the legal arrangement between spouses is one of the most important contracts. California is a community property state.  When you sign the marriage certificate, the “mine” usually turns into “ours, for earnings and property acquired thereafter. Anything you actively earn while married, anything you purchase with the money you earn while married and debt you take on while married is considered part of the marital coffers, with certain exceptions  The marriage certificate creates a contractual agreement that can impact title to real property,  your social security and retirement benefits, the taxes you pay, how your inheritance may be treated,  and your obligation to support your spouse should the marital relationship deteriorate to the point of divorce.   Yet most people spend more time contemplating the color scheme for the wedding or the DJ for the reception than they do on how to address important financial and property decisions should the marriage end. It may be time to add a prenuptial agreement to every wedding planner’s “recommendation” list.

What is a Prenup?

A prenuptial agreement, commonly referred to as prenup, is a formal written contract entered into between two soon-to-be spouses which typically addresses important issues regarding the characterization of income, property and expenses. California’s Uniform Premarital Agreement Act (UPAA) governs such agreements, outlining the rules and requirements that need to be followed to create a valid contract. The terms of a prenup list each person’s assets and debts and can include agreements regarding the rights to property acquired before, during, or even after marriage – including, assets, debt, inheritance, gifts, real estate, income, and earnings, as well as future interests. The prenup can also address obligations of spousal support, including providing for a waiver of such support, should the parties so desire—which can of course have serious lifetime implications. In California, prenuptial agreements cannot contract away child support or custody rights. The UPAA has several requirements for a valid agreement. Failure to adhere to the strict rules governing prenuptial agreements can jeopardize the entire agreement. The prenup should be updated as the parties’ financial condition and needs change, much as changing a will or trust.

While it may be difficult to consider the possibility of divorce when planning a wedding, prenuptial agreements can provide assurance that assets are protected should things not work out.  Prenuptial agreements can also save a lot of money, disagreement, and heartache by determining how to divide assets in advance if divorce should occur.  As with all things legal, the process can be time-consuming, so good wedding planning requires some diligence.  Maybe consider it before the proposal?

Author Traci S. Mason is a family law attorney licensed in California with over 19 years of litigation experience.  You can reach her at mason@portersimon.com.

DISCLAIMER: This article is not a substitute for professional legal advice.  This article does not create an attorney-client relationship, nor is it a solicitation to offer legal advice.