For a happy couple contemplating marriage and planning for the big day, a discussion related to divorce and death is usually not a top priority on the to-do list. However, consideration of a prenuptial agreement which can protect important property and financial interests requires that talk. Therefore, knowing what is a prenup and understanding its benefits are important to your financial future. A prenuptial or premarital agreement, also known as a prenup, is simply a written contract between two people planning to be married outlining use or disposition of property and distribution of debts in the event of divorce, the death of a spouse or other event.
Premarital agreements trace their origins back thousands of years when they were commonly used by royal families to protect their riches. A present-day misconception is that prenups are only necessary for the wealthy. In reality, prenups can be vital and provide benefits for people of moderate means.
Prenups are valid in all 50 states. More than half the states have adopted the Uniform Premarital Agreement Act drafted in 1983. States which have not adopted the act in whole have enacted statutes which mirror many of the law’s provisions. Continue reading