A prenuptial agreement is a form of marital agreement created before a couple gets married. Today, it’s much more common for couples to have prenuptial or postnuptial agreements, which allow them to determine financial rights, protect properties, and make other important decisions in case of divorce. In order to get the benefits from a marital agreement, it needs to adhere to contract law and be legally enforceable. A Bloomington prenuptial agreement attorney can help you make a strong marital agreement.
Although some individuals still believe that marital agreements indicate a marriage destined to fail, this is rarely the case. For most marriages, there are many benefits to creating and discussing a marital agreement.
What Marriages Can Benefit From a Marital Agreement?
There are many relationships that may benefit from a prenuptial or postnuptial agreement. Marital agreements can benefit couples who:
- Own a business or shares in a business
- Own high-value inheritances, real estate, or other assets
- Have a significant gap in income or wealth
- Have children together
- Have children from prior relationships
- Were previously married
- Have large amounts of debt
- Want to avoid divorce litigation
- Plan on one spouse not working for a certain amount of time for educational, vocational, or caretaking reasons
There are many other reasons why a marital agreement may benefit your relationships.
The Benefits of Prenuptial and Postnuptial Agreements
A marital agreement can have several benefits. These include:
- Determine Spousal Rights to Assets and Debts
A marital agreement can determine each spouse’s rights and responsibilities to property and dictate what assets and debts are considered marital or separate property. This can help spouses protect individual assets and also protect spouses from being responsible for debt. This is often useful if one party enters the marriage with significantly more assets or debts than their spouse.
- Address the Division of Assets
Partners can use a prenuptial or postnuptial agreement to outline how property will be divided if they get divorced. This can make the process of divorce much quicker and less stressful. When a married couple divorces without a marital agreement, they can make these decisions in mediation.
If they can’t mediate an agreement, these decisions are made by the court, which divides assets according to certain guidelines. A marital agreement can ensure assets are divided how you want and provide the financial security each spouse needs.
- Protect a Business
When one spouse owns a business, a divorce can severely threaten their ability to continue operating that business. The spouse who does not own the business may still have the right to some of its assets. The spouse may also be saddled with some of its debts. The creation of a marital agreement can address these worries and determine how the business will be managed, split, or otherwise dealt with in case of a divorce.
- Determine Inheritance Rights
If one or both spouses have children from a prior relationship, a marital agreement can determine the rights of those children to certain separate or marital properties. In case of a divorce, this can protect those assets for children.
- Decide Spousal Maintenance
A marital agreement can determine how spouses want to handle spousal maintenance or support that is different from the state’s formula. Spouses may also be able to waive their right to spousal support in a marital agreement. If these provisions are unconscionable and unfair, the court may overturn them.
- Understand Financial Matters Before Marriage
In negotiating and outlining a marital agreement, spouses can tackle important financial discussions. This could open important communication, prevent potential conflict about finances during their marriage, and provide each spouse with financial stability if they were to divorce. All of this can make partners more secure in their marriage and end up making divorce less likely.
Q: Are Prenups Effective in Illinois?
A: Prenuptial agreements, if they follow contract law and are legally valid, are effective in Illinois. However, there are several reasons why a prenuptial agreement may be unenforceable.
Any contract, including a marital agreement, is unenforceable if force, coercion, or duress is used. Both parties must agree in writing to the terms, and both parties must have the mental capacity to understand what they are signing.
If the court reviews the terms of a prenuptial or postnuptial agreement and determines it to be unconscionable or very unfair to one party, it may decide not to enforce the unfair provisions or any part of the agreement.
Q: What Does a Prenup Cover in Illinois?
A: Typically, a prenuptial agreement in Illinois can cover:
- Both spouse’s rights and responsibilities to marital and separate property
- Each spouse’s rights to property if the other spouse dies
- A decision or waiver regarding spousal support
- How and if the terms of the prenuptial agreement will be addressed in estate plans
- The situations that allow for modification of the agreement
Prenuptial agreements cannot address child custody or child support, as those decisions must be made in the child’s interests at the time of divorce.
Q: What Are the Disadvantages of a Prenuptial Agreement?
A: One of the main disadvantages of a prenuptial agreement is that spouses can waste time and money on it if the court decides it is unenforceable. If partners do not obtain legal counsel when creating the agreement, this is more likely. The court will not enforce portions of agreements or entire agreements if the terms are illegal or unfair to either party or if the agreement doesn’t meet basic contract law. Then, the couple will have to go through the divorce process from the beginning.
In some cases, terms will favor one spouse over the other, and the court will not strike it down. In that situation, one spouse may suffer significant financial hardship.
Q: What Is a Positive Effect of a Prenuptial Agreement?
A: There are several benefits to creating a prenuptial agreement, including helping partners have important discussions about finances as they begin their life together. A prenuptial agreement can determine each person’s rights and responsibilities to marital and separate assets and debts during and after their marriage, as well as create an effective foundation for communication that is vital in a marriage.
A prenuptial agreement can also provide spouses with a sense of financial stability. The agreement can determine how spouses will be cared for financially if they divorce. This certainty can make spouses feel more certain about the future of their marriage.
Create an Effective Marital Agreement
The counsel and review of an attorney can help protect your interests while you create a marital agreement. Contact Stange Law Firm today.