Prenups are often misunderstood. Most people think of a premarital agreement, aka prenup, as a roadmap for divorce. Instead, a prenup should be viewed as an agreement, entered into in advance of any conflict, that clarifies how the married couple will deal with their finances while they are married. It also can provide for security in the unfortunate event of the marriage ending in divorce or death.
The preparation of a prenup gives the couple an opportunity to discuss their finances. They can address their financial situation and clear up any misunderstandings. A prenup can head off many conflicts that could arise during the marriage if they communicate honestly before the marriage about their assets, their individual spending habits, and how to handle finances during their marriage.
A prenup is important for several other reasons:
- For those who bring separate property into the marriage, a prenup spells out exactly what property is owned before the date of marriage so that later it can be clearly identified if needed.
- Whether the property is real estate, bank accounts, or investment accounts, it is likely to increase in value during the marriage and the amount of the increase would be community property. A prenuptial agreement can provide that this increase in value remains the separate property of the owning spouse.
- For people who have children from a previous marriage or relationship, a prenup can clarify the financial obligations for those children so that the future-spouse can be sure that their children are provided for even after they get married.
The Collaborative Process and Prenups
Preparing prenups can be an adversarial process. The party with the most assets generally initiates the discussion about a prenup, which often sets off alarm bells for their intended spouse. However, discussing, negotiating and drafting a premarital agreement is a perfect situation for a collaborative approach.
In the collaborative process, both parties have the same goal. They sit down together with their attorneys, a financial professional and other members of the team who will help them draft a premarital agreement that works for their unique situation. If handled in this manner, the prenup can benefit them both so they can enjoy being married and not worry about those things that they would otherwise have to concern themselves with in the future.
For More Information About Preparing a Prenup, Contact an Experienced Dallas Family Law Attorney.
To schedule a free initial consultation with a Dallas Family Law Attorney, contact Paula Lock Smyth Law Offices at 214-420-1800.
Paula Lock Smyth has practiced law in Texas since 1985, focusing on Family Law, Probate, Mediation, and Collaborative Divorce. She is a trained mediator, seasoned litigator, and one of the early adopters of Collaborative Divorce in Texas. Paula is a member of the State Bar of Texas, the College of the State Bar and the Texas Bar Foundation and has served as Past President of Dallas Lawyers Concerned for Lawyers. She was a Master in the Annette Stewart Inn of Court and is a Charter Member of the Collaborative Law Institute of Texas. Her legal knowledge and decades of experience make her a trusted voice on matters that impact families across Dallas and surrounding counties.