Perhaps few aspects of marriage preparation or family law are more misunderstood than prenuptial agreements. Many think of one wealthy spouse using a prenuptial agreement to prevent the other spouse from getting any of his or her money. This is rarely the case, and more often, a prenup can provide certain protections for a lower-earning spouse.
With a prenup, a couple can decide from the very beginning how they will handle their finances, not only in case of divorce but also throughout their marriage. Unfortunately, without a prenup, those couples may miss their chance to pre-empt many common financial disputes throughout their marriages, and then they still must face the trauma of dividing their assets during a divorce. While many couples may benefit from a prenup, certain circumstances may more readily justify seeking such an agreement, including:
- Previous marriages, especially when those marriages ended in an unfair or painful division of assets
- Children from previous relationships, especially since New Jersey inheritance laws may favor the new spouse over those children
- A significant difference between the spouse’s wealth or income, not only to protect the wealth but also to provide for the other spouse
- Disparity of debt, which may otherwise place marital property at risk
- The ownership of a business that may otherwise be on the table during property division
A prenup can be a very flexible arrangement, including such items as privacy clauses or financial security for a stay-at-home parent. Each partner should have individual legal counsel for his or her own protection. It is also important to learn and understand the factors that may nullify the terms of one’s prenuptial agreement over the years.