A prenuptial agreement most commonly arises out of upcoming marriages where there is a great disparity of wealth between the parties who are about to be married, or when it is a second marriage and the parties both have children from their first marriages. The former situation can cause a lot of strife in the relationship if great care is not taken to include provisions whereby the less wealthy participant does not feel neglected or demeaned. Great skill is required to fashion an agreement by which both parties feel as if they are being treated fairly.
In the latter case, where both parties are trying to ensure that their own wealth passes down to their own children, there is much less likelihood for domestic strife between the parties. However, significant consideration must be given for the quality of life of the surviving spouse, for example the right to utilize the marital residence for a reasonable period of time, after the death of the first of the two parties. Given the multitude of issues that can exist with a prenuptial agreement, it is incumbent for a client to choose the right lawyer who knows how to ask all of the important questions, so that the agreement is set up to cover almost any situation that might arise.
Many practical-minded couples entertain the idea of creating premarital agreements as part of careful preparation for marriage. A Premarital agreement or “prenup” can be valuable tools for clarifying expectations and avoiding costly litigation in case of marital strife down the road.
People marrying for the second or third time, people with complex asset portfolios, and people with children from prior relationships are often interested in prenuptial or a premarital agreement.