You Are Engaged to Be Married – Have You Considered A Prenuptial Agreement?
A Prenuptial Agreement is an agreement between prospective spouses made in contemplation of marriage and to be effective upon marriage. It is a planning document that can be used for a number of reasons. Some of most common reasons to consider having a prenuptial agreement include:
- Protecting assets accumulated prior to the marriage;
- Maintaining separate accounts and other assets;
- Protecting anticipated wealth to be accumulated throughout the marriage;
- Protecting a family business;
- Limiting or prohibiting payment of financial support to the spouse;
- Assuring that children of one spouse from a prior relationship remain beneficiaries of an estate.
In considering whether to have a prenuptial agreement, it is important to understand the potential rights and obligations in the event of a divorce. In Pennsylvania, the division of assets and debts during a divorce is called "equitable distribution". Assets accumulated and debts incurred during the marriage are subject to equitable distribution. Increases in value of assets acquired before marriage are also subject to equitable distribution. There a number of factors that will be considered in order to determine the percentage of assets and debts to be allocated between the two spouses. There is no presumption of an equal division of assets and debts.
Furthermore , one spouse may be obligated to pay temporary support (in the form of spousal support or alimony pendente lite) and/or post-divorce alimony in the event of divorce. The Pennsylvania Guidelines apply in determining whether temporary support should be paid. Post-divorce alimony is awarded based on a number of factors set forth in the Divorce Code.
A benefit to having a prenuptial agreement is to allow the parties to determine in advance of their marriage the way in which assets and debts will be divided in the event of a divorce. The parties can also address the issue of temporary support and post-divorce alimony in a prenuptial agreement.
It is highly advisable that both parties seek the legal advice of a family law attorney in determining whether the prenuptial agreement reasonably serves their respective interests. In many situations, the party who initiates the prenuptial agreement is the party in the better financial condition. It is important to note that a prenuptial agreement is presumed to be valid and may be found to be invalid by a court under very limited circumstances.
The information provided is intended to be a broad overview of prenuptial agreements in Pennsylvania. If you are interested in discussing your situation with a knowledgeable attorney who has years of experience drafting prenuptial agreements and other family law matters, please feel free to contact me at 610-323-7464.