Did you know that a prenuptial agreement is a premarital contract setting forth an agreement regarding the distribution of wealth? When most people think of a prenuptial agreement, they may think of protecting assets in the event of a divorce. Let us take a look at three reasons why a prenuptial agreement can also be an important estate planning tool.
1. Prenuptial agreements can be more powerful than a will. If you only have a will, and not a prenuptial agreement, your spouse may have the ability to inherit more than you choose to leave him or her in your will based on protections provided to the spouse under state law. Indeed, many states provide a spouse with the right to “elect” against the will and inherit a designated portion of the deceased spouse’s estate, regardless of what the will says. A surviving spouse does not have this option to disregard a validly executed prenuptial agreement addressing the distribution of assets in the event of one spouse’s death.
2. Prenuptial agreements can ensure your premarital wealth is distributed in the manner you wish. Assets that you have accumulated before your marriage will likely become part of your estate subject to distribution to your heirs at the time of your death. Without a prenuptial agreement, those assets may pass according to your state’s laws, which, as discussed above, include certain protections for the surviving spouse. You can use a prenuptial agreement, along with your will, to help ensure your premarital assets are distributed to the individuals, and in the manner you envision.
3. Prenuptial agreements can protect your children from a prior marriage. If you have children from a prior marriage, a prenuptial agreement can help ensure that your children are given the portion of your estate that you desire in the event of your death. Many states give surviving spouses the right to disregard the will and inherit a certain portion of the estate; you can help ensure that your children from your prior marriage inherit the specific portion that you want them to inherit through a prenuptial agreement.
If you are engaged or about to marry, work with our office to find out whether and how a prenuptial agreement can fit in with your overall estate planning goals. Please contact us to set up an appointment.