“Who gets the dog?” is one (important) consideration. But the “Prenup” can have profound implications for the rest of your life, too.
The so-called “prenup” has become infamous in celebrity circles, giving rise to a number of very high-profile disputes and cases. In the real world, the Prenuptial Agreement does exist and can be a useful, practical tool to protect a spouse’s interests in the event of divorce. Careful attention needs to be given to understand how it functions and where its limitations lie. So how does the law work?
In the State of Indiana, all property owned by the parties will be divided upon divorce. This includes property owned by one or both spouses, whether it was acquired before or during the marriage. It is important to realize that, in this context, “property” also includes any inheritances and debts. The property division will start at 50/50, but this even split can be rebutted (challenged) by referring to a number of factors. However, the bottom line is, there is no guarantee that property owned prior to the marriage – or any inheritances received during the marriage – will not be awarded to the other spouse upon divorce.
A Prenuptial Agreement (also referred to as a Premarital or Antenuptial Agreement) is a formal contract that couples sign before marriage, clearly stating in a legally binding form “who will get what” if they end up in divorce. A common misperception is that Prenuptial Agreements are only used when one spouse has significantly more assets than the other. In reality, Prenuptial Agreements are useful tools for a variety of financial situations.
For instance, a couple can agree to each pay their own student loans upon divorce; keep their own 401(k) accounts; or, indeed, decide who will get the dog. The language can be stated in general terms or it can be very specific. Each Prenuptial Agreement is unique to the couple and will likely be upheld in court. So, giving an Agreement plenty of careful thought and considering its terms and implications ahead of signing up is crucially important.
Couples also need to be aware that “all bets are off” when it comes to any Prenuptial Agreements addressing child support and child custody issues. These will not be upheld in Indiana. Parties cannot agree to “no support” down the road or say that Mom will always have custody. Upon divorce, the court will look at the current circumstances of the parties and their children. It will then decide what is in the children’s best interests with regards to child support and child custody. It will not be bound by any terms in a Prenuptial Agreement with regards to child-related issues.
Roman-Lagunas & Wheeler can help explain the working of the Prenuptial Agreement, explore whether it is useful and appropriate in individual circumstances, and equip you to deal with any challenges to it in the event of divorce.