Getting Married? Why a Premarital Agreement is Important
Celebrities and the very rich may enter into premarital agreements. Justin Timberlake and Jessica Biel, Keith Urban and Nicole Kidman, Kim Kardashian and Kanye West, Michael Douglas and Catherine Zeta Jones all signed premarital agreements. Wealthy and high-profile people such as Mark Zuckerberg, Jessica Simpson, Tom Cruise, Tony Romo, Britney Spears, Barry Bonds, and even Beyoncé, all negotiated agreements prior to getting married.
Certainly, premarital agreements are not only for the ‘rich and famous’. Anyone with personal assets, liabilities, property - or children from a previous relationship - should consider entering a premarital agreement. Even if you didn’t enter a premarital agreement before the marriage, you can enter a post-marital agreement after you have married.
Premarital agreements can accomplish the following:
- Clarification of financial rights and responsibilities of each party during the marriage and after – whether as a result of divorce or death. If these matters are dealt with in advance of the marriage, unreasonable expectations can be reduced or eliminated.
- Identifying separate property which will, with (or even without) a premarital agreement, remain separate property. This can include inheritances or family heirlooms that should not be commingled.
- Protection from the debts of the other spouse which can include student loan debt, taxes and credit card debt.
- Control of spousal maintenance. This is one area of family law that is somewhat unpredictable – this is your opportunity to control that uncertainty. And this can be done in a number of ways – by providing a specific amount to be paid for a specific term, by providing a sliding scale, or by eliminating spousal maintenance entirely.
- Reduce conflict as well as the expense and aggravation of family law litigation in the event of a divorce.
- Premarital agreements are particularly valuable in cases where the parties have children from previous relationships and want to ensure a particular division of assets upon death or divorce.
There are disadvantages to entering a premarital agreement:
- The topic of a premarital agreement is not particularly romantic and may cause a lot of stress between a couple.
- The premarital agreement cannot cover future parenting time and legal decision-making or child support. Child related matters will be determined by the best interest of the child and not some agreement executed years previously.
Under Arizona law, separate property will remain the separate property of the parties in the absence of commingling or gift. But there are areas of complication – such as payments after marriage made to a mortgage or the value of a business increasing during marriage. These are complicated and difficult issues which may result in lengthy and expensive litigation – why not discuss and come to a reasonable resolution – and enter an agreement evidencing that agreement?
And if this is a forever marriage – there was no disadvantage to either party to enter into the premarital agreement. In the event of a divorce, they will have an agreement which will reduce the aggravation, heartache, and expense.
PREVIOUSLY PUBLISHED BY ABC15 Sonoran Living