Sunday, August 19, 2012

Prenuptial Agreements? Postnuptial agreements?

With people getting married later in life, they come to the table with more assets. Luckily, California is a community property state, which means that anything that you acquired before marriage or during the marriage if by gift or inheritance is considered separate property that your spouse could not access upon divorce as long as you do not commingle your assets with the marital (community assets). Anything else acquired during marriage (with some exceptions) is considered community property, in which each spouse would be entitled to 50% of the property value upon divorce.

Even if you are okay with the law as written, you still may opt to have a prenup or postnup if you would like to agree in advance how the property will be divided. For instance if you want the house you can write that into the agreement in exchange for other property or you buying out your ex at time of dissolution.
Prenuptial agreements (prenups) are agreements between the parties, written before marriage that agree to how you would split your assets upon divorce or agree to keep all income and assets acquired during marriage separate property. Postnuptial agreements (postnups) are similar, but the agreement is formed after you are married.

Due to the high divorce rate in this country, I always suggest that my clients get a prenup or postnup. In my experience it is always better to agree while you still like each other then try to get both sides to agree to how to split up property during a divorce where one or both sides hate the other person. When it comes to these agreements, it is best for you to hire an attorney to handle them for you to make sure that the agreement will be enforced. Essentially the court will review the agreement to determine if it was fair, entered into voluntarily, all assets were fully disclosed, and that both parties had access to an attorney to review and negotiate the document. Additionally, the court will review your circumstance not only at the time of signing, but also at the time of divorce to ensure that the agreement is not inherently unfair. Where one party would be left on government assistance the agreement will likely be altered. Also, things get particularly tricky when discussing retirement accounts, child support, child custody, and spousal support. Due to this, it is essential that both parties talk to an attorney.

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