Prenuptial agreements aren’t just for the ultra-rich. They can also help everyday people protect their assets and enter into a marriage with a clear understanding of shared finances. CNBC explains what goes into a legally binding, enforceable prenup that protects the interests of both spouses.
All prenups must contain certain elements. Assets owned by either party should be explicitly explained. Separate property is not subject to asset division should a couple get a divorce. Assets that aren’t mentioned will be included, so it’s best to disclose everything you own while creating the agreement. You should also devise a plan for how shared property will be divided. If you’re a business owner, you’ll need to lay out rights and responsibilities regarding earnings made by your business during your marriage. You should also keep in mind some commonly included provisions that aren’t actually enforceable.
This includes any language regarding child custody or visitation. Courts are tasked with maintaining the best interest of the child at the center of the dispute. As a result, a prenup can’t dictate who gets sole custody or how often the non-custodial parent will get to see the child. Other types of provisions, such as who does what housework, are also not enforceable as the court can’t make a meaningful determination on these matters.
When you sign your agreement is another important factor. Some states, including Massachusetts, don’t have a set time period during which a prenup must be signed, which means the agreement could conceivably be signed the night before a wedding and still be considered valid. However, when you sign too close to your wedding day, your spouse can make the argument that he or she felt pressured to agree to unfavorable terms. The best course of action is to sign the agreement immediately after your official engagement. That way, both parties have enough time to negotiate terms.