Tuesday, June 17, 2014

Do I Need Prenup?

Prenup is not a foreign word to a lot of people. It is a common questions to newly wed, especially those with relatively big difference in age or those who are not married for the first time. 

A prenuptial agreement ("prenup" for short) is a written contract created by two people before they are married. A prenup typically lists all of the property each person owns (as well as any debts) and specifies what each person's property rights will be after the marriage.

Do I need a Prenup? 
The best way to answer this question is to ask yourself, what is going to happen if I don’t have a Prenup? 

If you don't make a prenuptial agreement, your state's laws determine who owns the property that you acquire during your marriage, as well as what happens to that property at divorce or death.  State law may even have a say in what happens to some of the property you owned before you were married.
Under the law, marriage is considered to be a contract between the marrying couple, and with that contract comes certain automatic property rights for each spouse. For example, in the absence of a prenup stating otherwise, a spouse usually has the right to:

  1. Share ownership of property acquired during marriage; 
  2. Incur debts during marriage of the other spouse, and
  3. share in the management and control of any marital or community property, sometimes including the right to sell it or give it away.

Therefore, the answer to the initial question is, if these laws aren't to your liking, it's time to think about a prenup, which in most cases lets you decide for yourselves how your property should be handled.

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