Premarital agreements (often referred to as prenuptial agreements) are voluntary legal contracts made between prospective spouses, to become effective upon marriage. These written agreements address the rights related to and disposition of present and future property during marriage and in the event of termination of marriage, whether by death of a spouse or divorce. Additionally, premarital agreements can address future alimony payments, including the amount and duration of alimony or a waiver of alimony.
Do I need a premarital agreement?
While a premarital agreement may reduce the conflict associated with divorce, it can also help to define each spouse’s financial rights and responsibilities during the marriage. Additionally, a premarital agreement may explain how individual and joint assets are to be allocated in the event of the death of a spouse.
In general, premarital agreements address how property – which includes assets, income, debt, and personal property – is to be controlled and allocated during marriage and/or upon termination of the marriage or the death of a spouse. The premarital agreement can include property held by each spouse prior to entering the marriage as well as property gained, whether jointly or individually, during the marriage.
A premarital agreement is especially recommended if one or both of the engaged couple has children from a prior relationship, owns or has a stake in a business, gives up a career to be with his/her intended spouse, or has significant assets or debts incurred before the marriage.
I do not plan to divorce, so why do I need a premarital agreement?
While no one goes into a marriage expecting it to end, statistics show that approximately half of all marriages result in divorce. Divorce proceedings can be painful, expensive, and time-consuming and the process of separating property can make it even more so. Because the premarital agreement is developed at a point in the relationship when an engaged couple generally has the best interests of one another in mind, each person is more apt to be fair, logical, and transparent.
In the absence of a well-executed will, the premarital agreement may also be used to distribute property of a deceased spouse as he/she intended. This may be especially important if there are children from a prior union, involvement in a business, or other financial relationships or endeavors with third parties.
Do I need to hire an attorney to create a premarital agreement?
In North Carolina, premarital agreements follow a standard known as the Uniform Premarital Agreement Act. This statute defines the rules for executing and enforcing premarital agreements. However, each premarital agreement must specifically address the current and future situation and needs of the couple to whom it applies. Engaging legal counsel to develop a premarital agreement is highly recommended; family law attorneys are well-versed in both procedural requirements and legal considerations which, if not properly followed, could invalidate the agreement.
Can an existing premarital agreement be changed?
A premarital agreement can be revoked or amended by a written agreement signed by both parties.