Friday, November 7, 2014

Another reason you need a prenuptial agreement or postnuptial agreement

Many people have called to express their willingness to enter into a prenuptial agreement but assume all they need to mention in their agreement is ownership of  the personal assets they have prior to marriage. However, what they fail to realize is that State family law gives rights to personal property of the other spouse just by virtue of the fact that they have walked down the aisle unless the surviving spouse expressly waive them in an agreement. 

What are these rights?

One of these rights is the right to an interest in the deceased spouse’s homestead property. A surviving spouse is entitled either to the right to live in the deceased spouse’s homestead for his or her life  or to an undivided one half (1/2) interest in the deceased spouse’s homestead, even if the surviving spouse does not own an interest in the homestead property. 
In addition, by law, the surviving spouse can elect to receive thirty percent (30%) of all of the deceased spouse’s assets, including real estate, cash, securities, revocable trust assets, some irrevocable trust assets, life insurance policies, pension and retirement plans. The elective share is in addition to the surviving spouse’s right to the deceased spouse’s homestead property. 

With these being said, prenuptial or postnuptial agreement is on one hand to protect a spouse’s property right at time of divorce, and on the other hand to protect children and other family members’ right to estate property. If the surviving spouse waives his or her right to homestead property and elective share in such an agreement, the deceased spouse may legally devise his or her assets to whomever he or she chooses without limitation.