Written by: Second marriages, significant inheritances, and pressure from adult children can all lead you to wonder if you should have a prenuptial agreement (before marriage), or perhaps a postnuptial agreement (after marriage). In both of these agreements, you disclose your current assets and decide what happens to property you bring into the marriage and acquire during the marriage. You also state how you dispose of assets/property either at your death or in the event of a divorce.
A prenuptial agreement, or “prenup”, can be a useful tool to make sure that children from a previous marriage are provided for when a parent dies. Setting forth your wishes in your will or trust may not be sufficient. While you can disinherit your children, you cannot do the same to your spouse without their consent. The law affords spouses a significant portion of your estate regardless of what your will states.
A prenup should be drafted by a qualified attorney, and each spouse should use a separate attorney. You must make full disclosure of your financial status, and your future spouse must not feel pressured or coerced to sign the paperwork under duress. A prenup doesn’t have to be the final word. If the marriage is going well and circumstances change, you can write a postnuptial agreement with different terms. Either agreement can allow you to hold some assets jointly so that they automatically pass to your spouse.
Trusts are helpful in controlling the disposition of assets upon the death of a surviving spouse, but they are best used in conjunction with an agreement. Be warned also, that even with a pre- or postnuptial agreement, you may be held responsible for your spouse’s medical care. It is advisable for both partners to purchase long-term care insurance and to make sure that their future spouse will be covered by medical insurance prior to marriage.
Regardless of whether you and your spouse decide to use marital agreements, it is essential that you review your estate plans before or soon after you remarry. Don’t forget to update beneficiaries on life insurance policies and retirement accounts. I am available for consultation on these and other family issues pertaining to your estate plans.