Prenuptial Agreements: The Important Document You Never Think You’ll Need

family law attorneysMost of us do not enter into a marriage preparing for the possibility that it will not work out. Although we have all heard roughly half of marriages end in divorce, no one ever thinks their marriage will be one of them. For this reason, nine out of ten couples do not sign a premarital agreement before they get married.

California Community Property Law

California is one of eight states with a community property law, meaning all income and assets accumulated during the marriage will be split 50-50, including 401k and pension plans. Community property law also requires debt accumulated during the marriage be split evenly.

Anything acquired before the marriage or after the separation, as well as personal gifts and inheritance, is considered separate property. However, it can be difficult to keep separate property, well, separate. Placing inheritance funds into a joint bank account, or renting out or moving into a separately-owned house, is called commingling. When separate property is commingled with shared marital property, it is tough to untangle them.

Premarital Agreements in California

To you and your spouse, marriage is a promise to love, honor, and cherish each other forever. To the government, marriage (and divorce) is a business deal. Once only for celebrities and the ultra-rich, prenuptial agreements are now a tool used by many couples to protect their individual interests. Much like an insurance policy, you hope you never need it, but when something bad happens, you are glad it is there.

A prenuptial agreement allows you and your spouse to exercise some control over your financial situation, rather than leaving it to the mercy of the courts. It also helps you and your partner set marital expectations through honest discourse and full disclosure.

What Can and Cannot Be Included in a Prenuptial Agreement

Premarital agreements often include guidelines for:

  • division of assets
  • spousal support
  • assumption of debt
  • estate plans
  • management of joint business ventures
  • responsibilities during marriage
  • dispute settlement

Despite some interesting rumors about celebrity prenups, premarital agreements are financial contracts, not personal ones. Personal preferences included in a prenuptial agreement may be unenforceable. Some examples of what cannot be decided in a premarital agreement include:

  • child custody and support: a judge will decide this based on what is in the best interest of the child
  • unconscionable provisions: anything considered “unreasonably unfair,” like completely withholding spousal support, may not hold up in court.
  • financial incentives believed to encourage divorce; and
  • anything illegal.

Post-Nuptial Agreements in California

Sometimes a couple decides to clarify their separate and marital property after they are already married. Other times, a couple will choose to modify an existing prenuptial agreement years later, due to changing circumstances. In these cases, a post-nuptial agreement can be drafted to help couples sort out financial issues during their marriage.

Orange County CA family law attorneys

If you decide to sign a prenuptial agreement, be sure to have it reviewed by an experienced attorney. To learn more about prenuptial agreements and if creating one is the right step for you and your fiancé, contact our Orange County family law attorneys at R&S Law Group, LLP.