Divorce is something that affects many people in Denver and throughout Colorado. While most married couples don't expect to go through a divorce, in some cases it can be smart to be prepared just in case. Prenuptial agreements can be a good way for some couples to create a plan in the event of a divorce down the road. In a recent article in Daily Finance, experts offer some advice for soon-to-be-wed couples.
Although prenups can seem impersonal and unromantic, they are often a good thing for couples to consider before saying "I do." Some suggest that a quick review of each other's financial situation can be a good way to tell if a prenuptial agreement is something you should be thinking about.
Experts say to go over both what you have and what you don't have. Focus on property, inheritance or a stake in a company as well as debts you still owe, such as student loans. If neither of you owns nor owes a lot, a prenuptial agreement may not be necessary. If both or one of you does, however, a premarital contract might be something worth thinking about.
If you and your partner decide that a premarital agreement is the right thing for you, the Daily Finance article gives a few suggestions for approaching it. First, it's important to have a talk about money even though it can be uncomfortable. You want to be on the same page from the beginning. Second, have the agreement written up long before your wedding. Six months to a year before getting married should provide enough time for both you and your partner to review the contract.
Next, make sure your agreement is reasonable. There are a few ways to do this. First, the article suggests having an objective party review the contract. It can be easy to let your emotions get in the way during this process, and an outside individual can provide some realistic feedback. It is also suggested that couples not include any fault clauses in the contract that, for example, include an amount of payment owed if one person cheats. Lastly, familiarizing yourself with California's marriage property laws can be helpful.
While prenuptial agreements may not be for everyone, they can be a helpful tool for some couples as they approach married life.
Source: Daily Finance: "Five Tips on Planning a Prenuptial Agreement Before You Say 'I Do,'" Catherine New, 5 April 2011