One aspect of drafting a prenuptial agreement is planning for unforeseen circumstances in which the marriage would end. But these days many engaged couples approach their premarital agreement not so much with the possibility of divorce on their minds; rather, working together on a prenup is a good way for soon-to-be spouses to clarify their financial future together.
In other words, Florida couples can think of prenuptial agreements less as planning for the possible dissolution of the marriage, and more as another tool in their estate plan.
This way of thinking is increasingly popular among older Americans who are getting married relatively late in life or remarrying. By this time, each party to a marriage may have accumulated significant assets, and maybe one or both spouses have children from a prior marriage. A prenuptial agreement can address whether or not certain assets should be kept out of the marital property category and preserved for separate distribution.
For example, maybe one party to an upcoming marriage has created a business with his or her adult child. If the marriage ends or the business owner passes away, should those business assets go to the other spouse or to the adult child? In a prenuptial agreement, the business owner can clarify these matters, as well as name other assets that should go to the other spouse in place of the business assets.
It is also important to keep in mind that items such as premarital agreements, retirement accounts and life insurance policies can override the instructions laid out in a will. With that in mind, soon-to-be married couples will want to ensure that all of their legally binding documents are updated to match the current family situation.
Source: The Wall Street Journal, “Prenups and Estate Planning,” Liz Moyer, Nov. 15, 2013