DADvocacy now offers comprehensive services in premarital financial counseling and drafting of premarital agreements. Premarital agreements, more commonly known as prenuptial agreements, have become increasingly more popular. Call it romance, but as a society, Americans believe in the permanency of marriage, regardless of how unlikely the odds say it will be. Family law attorneys tend to be more pragmatic, and favor premarital agreements. Family law attorneys also consider a prenuptial agreement to be a near necessity in certain marriages, as outlined below.
- Older or elderly couples with grown children from prior marriage may benefit from a premarital agreement. It can help protect funds that either spouse may have saved for their children’s or grandchildren’s college education, or their own retirement, prior to the marriage. These couples will are more likely to have significant assets and debts, and will more likely have been unhappy with the consequences of their prior dissolution of marriage.
- Business owners, with closely held corporations, will also benefit from the advice of a family law attorney. I had the privilege of representing a very young man, who had a start up company with a few college friends. Each of the investors had started the business with a cash advance on their credit cards. My client was a 33% partner. The level to which the company was able to grow in a short span of time was staggering. Soon larger companies were courting them for a buyout or a merger. My client married at just that time, and four months later, he was in the midst of a divorce. The wife named the company and each partner as parties in her pleadings. The wife’s attorney wanted to value the entire company and depose each principal to determine the post-marital growth of the husband’s shares because the wife was entitled to half the growth as a marital asset. After several months of stress, and thousands of dollars, the wife accepted a lump sum and waived her right to value the business. A premarital agreement that delineated a limited scope of discovery in exchange for a cash sum award to the wife could have saved the business owners stress and attorney’s fees.
- Dual income professional couples planning to have children will also benefit greatly from prenuptial agreements. Early in my career, another attorney asked that I draft a prenuptial agreement for her. She and her intended were planning to have children as soon as nature would allow, and she was considering becoming a stay-at-home mom. My client had been in practice eleven years. She had built a fine reputation among colleagues and judges. She feared taking a “break” to raise young children and ending up at the bottom of the ladder career-wise, and in a financial mess, if the marriage collapsed. Her fiancée was also a lawyer. He had his own concerns about the potential for alimony and a staggering child support award if his marriage to a stay at home mom ended (he was previously divorced with a young son). However, he wanted his future children to have the same opportunity to be cared for by a stay-at-home parent as his son had. I drafted a prenuptial agreement to meet the couples’ needs. It provided for a fixed period of limited alimony, calculated in accordance with the years the intended wife would be out of the workforce, in order to allow this couple to make child-rearing choices with their children, rather than financial fear, in mind.
Decades of case law allow couples to use prenuptial agreements to essentially customize their potential divorce. Decisions once made by judges can now be almost predetermined by a premarital agreement. For many engaged couples, deciding their own financial fate is more attractive than allowing a stranger, either a judge or an arbitrator, to decide it for them.