There is a well-known adage that an ounce of prevention can be worth a pound of cure. When it comes to family matters, that prevention takes the form of a prenuptial agreement. Using prenuptial agreements can make divorce and estate planning easier for you and your family. By negotiating your property and financial affairs in advance, you can avoid expensive and emotionally taxing litigation in the future.
What is a Prenuptial Agreement?
A prenuptial agreement, also known as an antenuptial agreement or marital agreement, is a contract made in anticipation of a marriage between future spouses. They let romantic partners consider the way their relationship will work in the future. Depending on the language of the contract, you can:
- Define the spouses' roles and responsibilities within the marriage
- Establish how marital expenses will be divided and paid
- Define what property will or will not be part of the marital estate
- Limit access to spousal support
- Waive spousal inheritance rights
Negotiating a prenuptial agreement in advance of the marriage can help you take stock of each of your assets and debts and define what marriage will look like in the calm, and often happy time leading up to the marriage, long before any hard feelings arise.
Types of People Who Benefit from Prenuptial Agreements
Negotiating marital agreements can be helpful for many types of people. Unlike other kinds of estate planning, not everyone needs a prenuptial agreement, but they aren't just for the rich and powerful either. You may want to consider a prenuptial agreement if you or your fiancée:
- Have children from prior relationships
- Own property you want to keep separate from the marriage
- Owe substantial debts or liabilities
- Have shares or a membership interest in a family or closely held business
- Received or anticipate inheritances, trust benefits, or gifts
- Want to ensure a stay-at-home spouse will be provided for
Prenuptial agreements can protect the people and property most important to you against either divorce or probate disputes in the future.
How Prenuptial Agreements Make Divorce Easier
A prenuptial agreement's primary benefit is to protect the parties' pre-marital and otherwise separate property. The agreement will clearly define what property will be awarded to each party as his or her separate property should the marriage eventually end in divorce. This could include:
- Pre-marital property owned at the time of the marriage
- Inheritances and gifts received during the marriage
- Appreciation of that property during the marriage
- Wages, salaries, and other earnings which would normally be divided in a divorce
- Retirement accounts or pensions whether earned before or during the marriage
In addition, you can agree on when, how, and whether spousal support will be paid, who will be responsible for attorney fees during a divorce. If the marriage breaks down, you can ask the Michigan family court to enforce that agreement, avoiding time-consuming and expensive litigation over property and spousal support.
There are limits to what a prenuptial agreement can do, though. In Michigan, a prenuptial agreement cannot determine child custody, parenting time, or child support, since those must be based on the best interests and financial needs of the children. There are also some limited circumstances when a prenuptial agreement can be set aside or a party's separate property invaded if needed to reach a fair and equitable outcome. This is why you should carefully negotiate your agreement, with the help of an experienced Michigan family lawyer, to ensure it can be enforced to make your divorce easier.
The Benefit of Including a Prenuptial Agreement in Your Estate Planning
While most people think of prenuptial agreements in terms of preventing a spouse from taking advantage of Michigan divorce law, there are also substantial benefits for estate planning purposes. For one thing, many couples who enter into a prenuptial agreement waive their spousal inheritance rights.
Under Michigan probate law, if a person dies without a will, that person's spouse is entitled to a substantial portion, or in some cases the entirety of that person's estate. Even when the person does have a will, his or her surviving spouse can claim a one-third elective share along with certain allowances, including the couple's primary residence.
But for some couples, this spousal election would be taking money away from other dependents – such as the surviving spouse's stepchildren – who need it. A prenuptial agreement can waive those rights and carve out each party's separate property which can be passed to their intended beneficiaries.
Get Help Drafting a Prenuptial Agreement from a Michigan Family Lawyer
At Bebout, Potere, Cox & Bennion, P.C., we care about you and your family. We help individuals and families in Rochester Hills, Rochester, Troy, Lake Orion, Oxford, Oakland County, Macomb County and throughout Southeast Michigan. We can help you decide if a prenuptial agreement is right for you, and negotiate and execute an enforceable agreement. Call us at 248-651-4114 or contact us here to speak to an attorney.
