A prenuptial agreement, or prenup, is a private agreement between you and your partner that sets forth a fair plan for property division, alimony payments, debt obligations and other estate planning concerns should you end up separating.
If you are preparing for your wedding day, considering the possibility of divorce is likely the furthest thing from your mind. However, creating a prenuptial agreement may help both you and your spouse to gain greater peace of mind for both the present and the future.
1. Ensuring financial transparency
Financial disagreements are among the most common reasons for divorce. Unfortunately, dishonesty about financial facts is all too common among couples, both before and during marriage.
During the prenup process, both you and your spouse will fully disclose both assets and debts. This gives you both an opportunity to get a clear financial picture and hopefully minimize the possibility of future conflicts over money matters.
2. Laying a foundation for clear communication
Sometimes it is important to have the hard conversations when things are going well, rather than after communication has broken down. By facing the difficult details while you and your future spouse are on good terms, you may find it easier to continue having those conversations after the wedding, too.
3. Providing a plan for a worst-case scenario
Too often couples experiencing marriage problems stay in the relationship out of anxiety over life post-divorce. A prenup acts as an insurance policy should the worst happen.
Without a prenuptial agreement, you may face a potentially devastating, drawn-out divorce with an uncertain outcome. A well-crafted prenuptial agreement may help to reduce uncertainty by providing a clear plan for separation that leaves you both financially secure while minimizing emotional conflict.