Prenuptial agreements are contracts entered into by a couple before marriage to address financial matters that may arise during the marriage, and in the event of divorce or death. While most of us may think of “prenuptials” as relating to divorce, they are actually a great estate planning tool as well.
Prenuptials can help couples start off with a feeling of security and the added benefit of having an open approach to their finances. Wisconsin is a community property state, and in Wisconsin, these agreements are also called “premarital agreements” or “marital property agreements.”
The predominant reason why we as attorneys raise the subject of prenuptial agreements with our clients are second marriages. Client in their 40s or 50s typically have assets that they are bringing into a marriage, or children from a prior marriage.
Without a prenuptial agreement, should an individual die, it's quite possible that their children could be excluded from their parent’s assets. Also, one party may have continuing financial obligations to children or a former spouse under a prior divorce decree. One of the key ways to protect those children and a current spouse is a prenuptial agreement.
The possibility of divorce is, of course, a prominent reason for a prenuptial agreement. Some of the other circumstances where parties need a prenuptial agreement are:
There are limitations to prenuptial agreements. Prenuptial agreements cannot deal with custody and placement of children (this includes things such as in what religion to raise the children, their schooling, etc.) and child support.
Also, a divorce court is permitted to invalidate provisions of an agreement that are unjust at the time of divorce. This could occur in long term marriages if there is a great disparity between spouses’ incomes and no or little maintenance (alimony) being paid, or if a provision for division of property leaves a dependent spouse with nothing. It is important that an agreement be fair at the time of divorce as well as at the time of marriage.
Because a prenuptial agreement will almost certainly alter a spouse’s rights under the law, in order for an agreement to be enforceable:
A prenuptial agreements is a type of insurance for both parties when contemplating marriage. The process sometimes involves awkward communications between an engaged couple, but those conversations may prevent the financial misunderstandings that lead to divorce.
Our attorneys have many years of experience in laws regarding prenuptials in Wisconsin. Planning weddings and a lifetime together is stressful enough, so we approach each case in a thoughtful and sensitive manner. If you or a family member are considering marriage, take the time to speak with us. We are here to help start your marriage on solid financial footing.