Prenuptial Agreements: Potential Benefits for Couples Who Stay Married

It is made between spouses before they marry or enter into a civil partnership which establishes how they wish their assets to be divided if they should divorce or have their civil partnership dissolved.

Promotes Honest Communication about the Couple’s Finances

Act of creating a prenuptial agreement lead the couple to honest and complete communication about what they own and what they owe. With that knowledge, the spouses can work together to create a financial strategy that is beneficial to them as a married couple. Useful Estate Planning Tool
A prenuptial agreement can be a useful part of a couple’s estate plan. For example, a pre-nuptial agreement can be used by a spouse to sign away his or her rights to be the beneficiary of an insurance policy or retirement plan. This is particularly important if the spouse is required by law to be a beneficiary of such a policy absent an agreement otherwise. A prenuptial contract can also be used by a spouse to sign away his or her rights to the statutory spousal share of the other spouse’s property when the spouse passes away.

Include Rules
It includes all the rules governing the ownership and use of assets during the marriage and the settlement of said assets in the event that the marriage is dissolved.

Protection from Accrued Debts

Not everyone getting married has large assets. In fact, many people choose to get married despite the fact one party in the relationship has an unreliable finance history. In this situation prenuptial agreements can protect the other party in the relationship from previously accrued debts.

Benefits
• It also protects the disputes and apprehension between the parties about the division of assets.
• It is also used to preserve inherited family wealth.
• It is very useful for the couples to enter into pre nuptial agreement before the marriage.
• It will keep the cordial relation between the spouses.
• It also minimizes the injustice between spouses.
• Each couple must describe in great the detail his assets in the pre nuptial agreement.
• This will help the parties to ascertain which party owns what before the marriage.
• Mostly, the disputes between the spouses occurred on the financial assets. It also strengthens the family relationship and provides the more pleasure to the matrimonial life.
• It is an important document because it determines the ownership of the assets.
• Couples can freely earn or buy anything without the fear that their asset will be divided equally.
• This agreement stops the operation of rule of division of assets on equal basis.

Governing law

Ireland do not have legislation on pre-nuptial agreements.

Contents
• Strength family relations
• Determine ownership of assets
• Protect from debts
• Useful estate planning tool

Reason to buy from Net Lawman
The prenuptial agreement from Net Lawman provides you a comprehensive range of agreements that save your time and can be amended accordingly as and when required.

Importance of Pre nup agreement

Prenuptial agreements: Unromantic, but important
The prenup seems so utterly unromantic — or just plain wrong — but it’s also become so right for so many these days: those keenly aware that a marriage may end up in a legal separation, divorce or death. Most prenups tackle financial issues such as real estate, division of bank accounts and potential spousal support in the case of divorce or separation.

Who does it apply to?
A BFA can be made between couples who intend to marry, are married, or have been married. Same sex couples and defactos have always been able to have a contract between them.

It needs to be signed by both parties, and a certificate of legal advice must be provided that the party concerned has obtained independent legal advice. The Binding Financial Agreement is not legally enforceable until a lawyer explains the BFA.

What does a BFA deal with?
A BFA can deal with any or all property and financial arrangements.

It can include
• spousal maintenance,
• superannuation,
• and incidental or ancillary matters.

Why are they important?
BFAs result in greater certainty in property settlements. They allow couples who do have a relationship breakdown to take control of their financial affairs.

The agreement allows practical financial matters to be dealt with in a tax effective way. For example joint ownership of shares, real estate, or valuable personal commodities.

This results in greater certainty and avoids conflict over financial matters in the event of a relationship breakdown.

A BFA may be particularly relevant in the scenario where one party is bringing considerable family wealth into a relationship, for the protection of prior assets, or for farming properties and family businesses.
Second marriages should particularly consider a BFA.

Tax Planning
One can provide a tax effective mechanism for the division of property if there is a break down.

Who Needs Them?
• Anyone about to enter a marriage who is concerned about the inadequacies of the laws in the face of today’s social realities;
• Anyone who is remarrying;
• Anyone concerned about protecting the assets of children from a prior marriage;
• Anyone who has a financially dependent parent;
• Business owners, particularly of professional practices and particularly those with business partners, because a spouse effectively becomes a silent partner in the business;
• Anyone with significant separate property in states where a spouse is entitled to a share of income from separate property.
• Anyone whose intended spouse has significant premarital responsibilities, such as alimony, child support, or tax obligations.
• Anyone cautious enough to prefer a written record of the ownership of assets to avoid confusion in the future from creditors or other family members.

Guidelines for creating the agreement
A prenuptial agreement is valid only if it is created under two conditions:

1) There must be “full disclosure” between the two parties, in order that there will not be a finding of fraud, misrepresentation, or duress. Both must thoroughly disclose financial details: income, assets, and liabilities, in the document.

2) Each spouse must individually be represented by separate attorneys prior to signing the prenuptial agreement, again to reduce the risk of drafting and agreeing to an unfair agreement

Once each of the two conditions above are met, and the contents of the prenuptial agreement are satisfactory to both parties, you and your spouse each need to sign the prenuptial agreement, and the prenuptial agreement must be notarized.

Governing Law
Prenuptial agreements are recognised in Australia by the Family Law Act 1975

Contents
• Importance of finance agreement
• Who need them
• Governing law
• Assets distribution
• Full disclosure of assets
• Guideline for the agreement
• Tax planing

Reason to buy from Net Lawman
The pre-nuptial agreement from Net Lawman provides you a comprehensive range of agreements that save your time and can be amended accordingly as and when required.

 

Validity of prenuptial agreement

It is an agreement between two people who are anticipating marriage. In the document, the parties set out how they would like their debts and assets distributed in the event of death or divorce.

Requirements of validity
That each party was of sound mind when it was drafted,

Each had a thorough knowledge of the finances and assets of the other.

The document must also be voluntary for both partners; under pressure is not valid.

 Validity of Prenuptial when challenged

The courts typically uphold prenuptial agreements unless one person shows:
1.    It is likely to promote divorce
2.    It was written and signed with the intention of divorcing
3.    One party was forced into signing
4.    It was created unfairly

Issues that are typically addressed by a court if the agreement is challenged:
a. Was the agreement entered into voluntarily?
b. Did the parties have the opportunity to have it reviewed by counsel of his/her own choosing?
c. Was there full disclosure of all assets, liabilities and income?

Additional requirements for valid Prenuptial include:
•    Both parties must voluntarily execute the agreement.
•    Both parties must engage in full disclosure of their respective situations at the time the document is executed.
•    Both parties must sign the document in the presence of a notary public.

What makes it Valid?
A.    It must be in writing and signed by both parties. It is enforceable without consideration.
B.    It becomes effective on marriage of the parties.

Essential requirements that must be satisfied in order for a premarital agreement to be upheld:

a. There must be full and fair disclosure of the earnings, property, and financial obligations of the parties. A complete and comprehensive financial statement must be attached to the agreement that sets forth the parties’ earnings, property, and financial obligations.
b. Both parties should be represented by attorneys. A prenuptial agreement will likely not be enforceable if the other party did not consult with an attorney, or did not waive the right to do so in writing.
c. The agreement must not be unconscionable. An unconscionable premarital agreement is defined as an agreement that would leave a spouse as a public charge or close to it.

The agreement is not enforceable if the person against whom enforcement is sought proves either of the following:
•    The person did not execute the agreement voluntarily
•    Person was not provided a fair and reasonable disclosure of the property or financial obligations of the other party.
•    That person could not have had an adequate knowledge of the property or financial obligations of the other party.

UK Law
Pre-nups are not strictly enforceable or legally binding in the UK (England and Wales). Unlike a commercial contract one cannot sue on a pre-nup and there is always the possibility that if the marriage breaks down the court will not uphold the terms of the pre-nup.

Contents
•    Definition
•    Validity
•    When validity is challenged
•    Important element to make an agreement valid
•    Issues addressed by court

Why make a Pre nuptial Agreement

Pre nuptial Agreement
It is an agreement between two people that deals with the financial consequences of their marriage ending.

Why customized

It is known as divorce law. However, a lot of people are unhappy with the way divorce law works, and prefer to take control of their lives, rather than leave it in the hands of the government. In these cases, it makes a lot of sense to get a customized prenup.Why getting a prenuptial agreement 

Getting a prenuptial agreement is particularly important in following circumstances

• One is much wealthier than partner
It can ensure that a partner is marrying you for who you are, and not for money.

• One earn much more than partner
It can be used in many states to limit the amount of alimony that is payable.

• Remarrying.
It can ensure that when one passes away, the assets are distributed according to one’s wishes, and that neither ones’ first family, nor new family are cut off.

• A partner has a high debt load.
It can help ensure that a spouse wont share his/her partner’s debts

• One own part of a business.
It can ensure that a spouse does not become an unwanted partner in one’s business.

• To prevent spouse from overturning One’s estate plan.

A pre-nuptial agreement can ensure that one’s estate plan works, and, for instance, ensure that a specific heirloom remains in one’s family.

• One is much poorer t han his/her partner
It can also be used to ensure that the partner who is weaker financially is protected.

• If one plan to quit job to raise children.
A prenuptial agreement can ensure that the financial burden of raising the children is shared fairly by both partners.

• Divorce is Easier
Divorce proceedings are easier when a prenuptial agreement has been signed. A pre-marital agreement often specifies how possessions will be divided. This makes it less likely that one will have to go through a long, messy divorce to hash out those details. This is a benefit because a divorce may be an emotionally taxing time. If the divorce is fast, it can also save money on lawyer fees. In this way, a prenuptial agreement can benefit anyone who signs one.

• Reduce Misunderstandings
Arranging a prenuptial contract can encourage an honest discussion about how money will be shared within the marriage. This will reduce potential arguments that may arise after the marriage ceremony. Also, once the agreement is signed, it can eliminate any worries that money or possessions are the true motivator of one or both parties

UK law
Prenuptial agreements have been recognised as enforceable under British divorce law for the first time, in a supreme court ruling today. By ruling that such contracts are legally binding, the Supreme Court has altered the landscape of divorce settlements.

Contents
• Definition
• Why important
• Circumstances when important
• Divorce is easy
• Reduce misunderstanding

Prenuptial Agreement Protect Premarital Assets

Why agreement is required

When a couple take the step of living together, whether this is with a view to marriage or long term cohabitation, it is important that steps are taken to protect assets which are being brought into the relationship and to define what will happen to those assets in the unfortunate event that the relationship subsequently breaks down.

Exclude liabilities
Pre nuptial agreement will protect all current and future assets. It excludes the liabilities of the parties towards each other and the asset of the parties earned before or after the marriage will remain the sole property of the individual party. If the parties do not prefer to enter into pre nuptial agreement, the assets will be divided on the equal basis.

Implication for Ireland
When determining what awards to make in relation to the division of assets on a judicial separation or a divorce the Irish Courts are bound by the requirement that they make “proper provision for both spouses” out of the assets of the couple. This requirement arises out of the special protection afforded to the institution of marriage by the Irish constition.

Inventory of assets
Under the proposed agreement, a couple would complete an inventory of assets each person held before the marriage and agree that in the event of a divorce, each would be entitled to keep those original assets.

However, any new assets acquired during the course of the marriage, such as improvements or additions to the farm, would be divided between the couple.

Protects Inheritances
Prenups can ensure that any inherited money, property or assets will stay within the family. Protecting an inheritance is the primary reason middle-aged people with children are likely to enter into a prenuptial agreement. prenup can give peace of mind to children or other family members who worry about being effectively disinherited in the event of divorce.

Protects from Spouse’s Debt

When divorcing, marital assets are not the only thing that must be divided: marital debt is divided as well. If one spouse incurred substantial debts before or during the marriage–while starting a new business, for example–in some circumstances, it may be unfair to hold the other spouse partially responsible for the repayment of the debt upon divorce. A prenup can determine who shall be responsible for debts incurred before or during the marriage.

Substantial protection and benefits of filing joint marital tax
Although it provides substantial protection for the Prospective Husband and the Prospective Wife’s separate property, it also allows the couple to avail themselves of the benefits of filing joint marital tax returns during the course of the marriage without creating the presumption that income from the respective parties has become marital/community property.

Contents
• Exclude liabilities
• Protection of assets and benefits of tax returns
• Protection from spouse debts
• Protect inheritance
• Inventory of assets

Reason to buy from Net Lawman
The premarital agreement from Net Lawman provides you a comprehensive range of agreements that save your time and can be amended accordingly as and when required.