Why Should You Have a Prenuptial Agreement?
If you are the owner of a family-held business, or anticipate a future interest in one, a prenuptial agreement can help ensure that those assets remain in the family. If you expect to receive a significant inheritance during your marriage, a prenuptial agreement can protect those assets from becoming entangled in the marital estate. If you are a promising professional, who may not have significant assets at the start of your marriage, a prenuptial agreement can even protect assets you may acquire with your future earnings. And, for a couple who may be entering a marriage with children from a prior relationship, a prenuptial agreement can preserve your hard-earned assets for your children from your prior marriage. Although the above examples are not an exhaustive list, they are certainly some of the most common reasons couples decide to enter into prenuptial agreements.
Create Certainty in Your Estate Planning
In addition to divorce planning, prenuptial agreements can also be a very important estate planning tool. An effective prenuptial agreement, coupled with targeted estate planning, will allow you to provide financial security for both your spouse and your children in the event of your death. Through a prenuptial agreement, you can determine exactly what share of your assets your spouse will receive. As an estate planning tool, a prenuptial agreement can provide clarity to your heirs and minimize probate challenges made by your spouse.
Pennsylvania has an “Elective Share” statute pursuant to 20 Pa. C.S. 2203(a). This law provides that if a couple is still married (with no divorce pending) at the time of one spouse’s death, the surviving spouse can elect to receive 1/3 of the deceased spouse’s estate. This law supersedes the deceased spouse’s Last Will and Testament – even if it disinherits or leaves the surviving spouse a smaller amount than what is stipulated under the Elective Share statute.
However, you can use a prenuptial or postnuptial agreement to waive the rights to any Elective Share amount. Thus, a valid prenuptial agreement allows you to truly control how your estate is distributed.
You Need a Well-Drafted Prenuptial Agreement
Through a well-drafted prenuptial agreement, you can protect the assets you bring into the marriage and assets you acquire in the future. This will minimize litigation over your assets and your income and save you or your heirs the uncertainty of the outcome and the potential of substantial legal fees.
Discussing a prenuptial agreement with your future spouse may not be easy; however, neither will going through a messy divorce or a probate challenge. A prenuptial agreement can manage both parties’ expectations and hopefully mitigate animosity should the marriage end, allowing both parties to move forward with the next chapter of your lives.
We do not recommend that you use a business or estate attorney to draft your prenuptial agreement because they are unfamiliar with family law and the consequences of a divorce. Having dealt with many high asset divorce cases, our family law attorneys have seen the effects that the lack of a prenup, or an inadequately crafted prenup, has on our clients. If you want a prenup that offers you financial certainty and covers all potentially unpleasant events, we are here to help you.