Prenuptial agreements are not just for the wealthy of the world. Even though there is lots of buzz around the upcoming royal wedding and even Hugh Hefner’s big day in June, engagements and the topic of prenuptial agreements are being utilized more by the average American.
The beauty of a prenup is that it puts the terms of the marriage in the hands of the two individuals, not the court system or the state. It is a couples’ unique moment to know what each expects of the other in advance so they have a clear understanding of what will happen with debts, assets and property.
For many partners who are remarrying or getting married at an older age, it is important to know that you do not have to take on debts, child support, or any other financial obligations the other partner has. This can be vital should a divorce occur in the future, as you could be held liable for these debts unless they are clearly defined in the prenup.
Also, if one individual owns a family business, the prenup will spell out who gets control of it should death or divorce occur. Some people will want to create a buy-sell agreement so that other blood relatives would have the ability to buy out the divorcing spouse and any of their heirs.
In the new book “Spousonomics: Using Economics to Master Love, Marriage, and Dirty Dishes”, the authors show how common economic theories can “minimize conflict and maximize returns on life’s biggest investment – your marriage.” A prenup brings financial conversations out in the open early on and will actually solidify what each expects of the marriage and their plan for success.
The authors of the book also write about the pitfalls of being overconfident. “Overconfidence is what causes CEOs of major corporations – think Merrill Lynch and Lehman Brothers – to blow up their firms,” the two authors say. “They didn’t plan for the worst because they thought they were too smart to drive their banks into the ground. Similarly, overconfidence drives couples to assume they will be together forever and then fail to take into account how much strain certain events might put on their relationship.”
So while a couple might not think they need a prenup, the bottom line is that it can save couples pain, money, and perhaps even the understanding of their new future together. Prenups should involve legal counsel, and each partner should have a separate prenuptial attorney to give each person peace of mind that their interests and rights are upheld. In Colorado, hiring an attorney will ensure that the prenup includes important state statutes and will be valid in court.
The Thode Law Firm, P.C. has represented hundreds of clients in the Denver metropolitan area since 1997. As the lead Colorado prenuptial attorney, Bill Thode counsels fiancés on their wishes and unique circumstances to create a thorough, enforceable prenuptial agreement. He also is experienced in postnuptial agreements and family law matters.