In pop culture, prenuptial agreements are relegated to the super-rich. Television and film portray wealthy people using prenups to protect their wealth first and foremost.
There is an element of truth to this stereotype. Marital contracts are primarily used for financial purposes, but those benefits go far beyond making sure that the wealthier spouse keeps all their money. Many of these financial stipulations can help regular families of normal means. Furthermore, there are several ways to use a prenup that have nothing to do with money.
Here are some reasons to consider a marital agreement, regardless of your income.
Types of Marital Contracts
Before going forward, let’s clarify the language regarding these agreements. First, you may have noticed our using several terms to talk about the same thing.
Marital agreements can go by many names. Furthermore, there are different types of agreements. A prenuptial agreement is drafted before the marriage. A postnuptial agreement is drafted after the wedding. As a result, you can swap many of the words around, creating many different names for these agreements.
Here are several different terms for marital agreements:
- Marital Contract/Agreement
- Prenuptial Contract/Agreement
- Premarital Contract/Agreement
- Postnuptial Contract/Agreement
Marital Contract Benefits for the Kids
A marital agreement can control the finances in limitless ways. For instance, you can use these contracts to designate money for the children. This money can be set aside and allowed to grow. Within the contract, you can stipulate that neither parent can access this money. Its sole use is to fund college, give it to the kids when they turn 18, or any other purpose you think is appropriate.
Using Marital Agreements to Designate Property
Generally, any property that was purchased during a marriage is considered marital property. If the marriage should end, the court must decide how to divide this property between spouses.
In New York, courts divide property equitably, or by fairness. In theory, this system makes sure that you will keep the property that is “yours.” For instance, let’s say you have a closer bond with the family dog than anyone else in the home. According to the equitable system, you should be able to keep that animal. Courts, however, are not flawless, and people can get petty during a divorce. Spouses can go after one another’s property simply out of spite.
With a marital contract, you can officially name which property will always belong to which spouse. Imagine you have a huge comic book collection that you’ve added to since childhood. Technically, your spouse could lay claim to any comics you bought while you were married. Through a marital contract, you can make certain that any piece you add to your collection will always belong to just you.
Marital Contracts for Division of Labor
Property and money are usually someone’s top concerns in a marital contract. Many are surprised to discover that you can also use them to manage the marriage as well.
Instead of making up the rules as you go along, you can put them into a legally binding document, never worrying about them again. One spouse can manage the money while the other manages the home. Maybe that upkeep itself should be part of the contract. One spouse takes care of the laundry, the other does the floors.
You can also designate roles for child-rearing. Maybe one parent takes care of educational concerns, and the other manages healthcare. One adult may be a better fit as the disciplinarian, and the other is a better teacher.
Legally designating job roles within a marriage may sound strange and clinical to some, but doing so can save you a lot of strife. If the floors need cleaning, for instance, everyone knows whose job that is, and there’s no need to argue or negotiate. When a teacher requests a face-to-face visit with a parent, you already know which parent that will be, and it’s up to that person to coordinate the meeting. If you’re the type of couple who wants to know what to do in advance and never worry about it again, a prenup may be for you.
Marital Agreements Controlling Daily Finances
When we think of marital contracts, we often imagine chunks of money. We want to protect our savings, the kids’ college funds, etc. We may not always be aware that martial contracts can also control daily spending.
It’s no secret that when couples argue, money is one most common topics of conflict. Too often, couples have no plan and try to figure out their finances as they go along. This can be a great source of distress, confusion, and frustration.
You can bypass this future argument by deciding how you will spend your money and putting it in a contract. Some couples may simply split all expenses 50/50 and equally share whatever is left over. Some use a percentage system. They take the total family income and calculate who brings in what percentage. That person then pays that percentage of expenses, so if they bring in 40% of the overall money, they pay 40% of the bills.
We could go on and on about different ways couples can divide their expenses. The point is this: You can put whichever method works for you in a leally-binding contract. Then you can avoid conflicts and worries about money and focus on what’s important, the relationship.
Planning for Dissolution
You probably don’t want to think about divorce, especially when your marriage is just beginning. The reality is, however, that about 50% of U.S. marriages will end.
With a marital agreement, you can plan for what will happen should the marriage unfortunately end. For instance, you can choose how you will divide property and assets. You can decide now whether to take the divorce to court or to mediation. You have almost limitless options for how you wish to handle this situation, and you can save yourself many potential woes by putting them in a contract now.
Contact our firm today for help with marital contracts. We can work with both spouses, helping ensure a fair agreement for all parties involved. For a free consultation, call us today at (516) 514-3868 or reach out online.