Protecting financial interests before marriage is not a luxury reserved only for the wealthy, but is a smart choice for all Colorado couples. If you are getting married, you would be wise to consider the benefits of a premarital agreement, also known as a prenuptial agreement. Taking this step is not planning for divorce in the future, but is an effort to provide peace of mind and protection in case of extenuating circumstances.
Premarital agreements typically outline instructions for the division of marital property in the event of a divorce, but you can also custom tailor these agreements to address other important concerns.
Factors to consider when drafting your prenuptial agreement
Property division disputes are one of the leading causes of contention in divorce, but a premarital agreement can eliminate unnecessary and costly litigation. Not only do these agreements outline a fair way to divide any property or assets accumulated over the course of the marriage, they can include other considerations. There are important questions to ask while drafting an agreement, such as:
- Are assets and debts accumulated before the marriage separate property?
- If both parties contributed payment toward debts accumulated by one spouse before marriage, who will continue to pay the balances after divorce?
- If one spouse accumulated student loans during the marriage and both spouses contributed toward payments, who is responsible after divorce?
- Will marital debts and assets be split 50-50 or by another arrangement?
- Who will get the house and other real estate holdings?
- Is a family-run or jointly-owned business in question?
The answers to these important questions will lay the groundwork for a strong prenuptial agreement that benefits both parties and meets your specific objectives.
Discussing important issues before marriage
Drafting a prenuptial agreement before getting married may not seem like a romantic endeavor, but it can initiate important conversations between you and your future spouse. Having a complete understanding of the other person's approach to finances, paying off debt, saving for the future, income and other money-related issues may even help you avoid conflicts and misunderstandings in the years ahead.
Prenuptial agreements are quite common for second marriages in which one or both spouses already have children or assets that require protection. Whether it is your first marriage or you have been married before, you can start your married life with peace of mind knowing your interests are protected.