Prenuptial Agreements, What You Need To Know!

---

While a prenuptial agreement may seem unromantic, it can be a proactive step in building a strong partnership—both in love and in life. A well-drafted agreement helps you and your partner understand each other better and can prevent potential conflicts, ultimately reducing stress in your future together. It’s crucial for each party to retain their own attorney to protect individual interests and ensure a fair agreement.

Assessing Your Assets and Liabilities

The first step in creating a prenuptial agreement is to assess both partners’ assets, liabilities, and incomes. In New Jersey, for example, full disclosure is essential; you must provide a detailed account of all your assets and attach it to the agreement. Failure to disclose certain assets can render the agreement invalid in court.

Disclosure vs. Documentation

While you don’t have to provide copies of documents like deeds or mortgages before marriage, you do need to disclose your assets. For example, when listing a car, include details like the make, model, year, and condition without needing to show the title. 

Key Considerations for Your Prenuptial Agreement

1. Property Ownership
       Discuss how you view pre-marital assets. Generally, property owned before marriage remains separate, but any increase in its value during the marriage could be part of the marital estate. It’s wise to specify that pre-marital property will remain separate.
2. Financial Management
       Decide how to handle finances: joint accounts, separate accounts, or a combination. Be cautious with commingling funds, as it may jeopardize the separate property status.
3. Real Estate Ownership
       In New Jersey, real property purchased by a married couple typically falls under "tenants by the entirety," meaning both parties share equal ownership. Consider including provisions in your prenup regarding future property purchases and rights in the event of divorce or death.
4. Spousal Support (Alimony)
       Outline expectations for alimony. You may waive it entirely or specify a payment structure based on certain conditions, such as cohabitation or remarriage.
5. Debt Management
       Clarify how each partner’s debts will be handled—whether they remain individual or become joint responsibilities.
6. Provisions for Disability or      Incapacity
       Address what happens if one spouse becomes disabled, including income loss and medical expenses.
7. Separation Issues
       New Jersey lacks a legal separation status, so consider how to handle support and living arrangements if you separate.
8. Differences Between Divorce and      Death
       Understand how assets are treated in divorce versus death. Without a prenuptial agreement, separate property could pass to your spouse upon your death.
9. Other Issues to Consider
   • Pets: Address custody of pets in the event of separation.
   • Student Loans: Decide how these debts will be allocated.
   • Retirement Accounts: Specify the division of pre-marriage and marital retirement contributions.
   • Sunset Clauses: Include provisions to revisit the agreement after a set time.

Preparing the Agreement

Once you understand your rights, have an open discussion with your future spouse about your financial situations. Retain attorneys to draft the agreement, allowing for a back-and-forth process until both parties reach a consensus.

Signing the Agreement

It’s best to have all parties together when signing the agreement, but remote execution via video conference is possible. Ensure the agreement is witnessed and notarized to increase its validity.