One of the biggest mistakes people make regarding prenuptial agreements is deciding they don’t need one. They might not have a robust investment portfolio or significant assets to protect.
Before you make this same mistake if you are planning to get married, it can be helpful to understand the many ways a prenup can protect people.
SETTING RULES FOR DISPUTES
When people divorce, they are often not on good terms with each other. Some hate each other; others have lost all trust in their spouses. Typically, this can cloud people’s judgment and make it difficult to make pragmatic decisions.
Under these circumstances, parties can wind up battling in court.
Instead, people can agree to pursue alternatives to litigation in a prenup. When parties are preparing to marry, partners want what is best for each other. And making decisions out of a place of peace and compassion can provide valuable guidance when parties are in a not-so-amicable place.
Generally, parties do not use a prenuptial agreement to address child support or child custody matters. However, if you have a pet, you could make arrangements for them in a prenup, also called a “pup nup.”
In these agreements, pet owners can determine who will keep a pet, what custody will look like and whether one or both owners will cover the cost of pet care. Resolving pet-related issues in advance can help prevent conflicts when owners divorce, which can otherwise arise and complicate an already complex process.
PROMOTING OPENNESS AND COMMUNICATION
Whether you are entering a marriage with modest assets and individual debts or substantial individual property or businesses to protect, financial openness and honesty are crucial. In some marriages, people wind up learning unfortunate truths or uncovering bad financial habits when it is too late to protect themselves.
Discussing financial matters as part of a prenup requires full disclosure. While it can be uncomfortable, having this conversation can ensure parties are on the same page before committing to each other.
DON’T DISMISS YOUR OPTIONS PREMATURELY
Negotiating a prenuptial agreement can protect a range of interests for people from every background. Before you dismiss the prospect of creating one, it can be wise to consider your specific situation and whether a prenup can help you protect what is most important.