Why to Consider Drafting a Prenuptial Agreement
In the days leading up to engagement and marriage, thinking about the negative possibility of divorce is not a topic most couples want to contemplate. Visions of growing old and all the things they hope to accomplish together usually overtake any concerns about the relationship not lasting.
While expecting a marriage to last a lifetime is the reasonable way to approach a new relationship, no one knows the future. Hammering out how to handle property division and payment of support in the event of divorce through the use of a prenuptial agreement may not be romantic or optimistic, but sometimes pragmatism is more important in the long-term. These conversations are especially important if a couple is older and/or is bringing a lot of assets and other financial resources into the marriage.
Figuring out these issues before divorce is on the table will make the process of dissolving the marriage easier by reducing the likelihood of disputes and the time needed to negotiate a settlement. The terms of these agreements must be memorialized in writing and executed prior to marriage. Further, Illinois regulates the formation and types of provisions these agreements can legally contain.
How to Create a Binding Prenuptial Agreement
As mentioned above, prenuptial agreements must be formed before and in contemplation of marriage, meaning the couple must be planning to marry when an agreement is drafted. In addition to being written, the agreement must be signed by both parties, and becomes valid once the marriage takes place. Modifying or revoking these agreements after marriage is allowed as long as the same formalities used to create them (i.e., written/signed) are followed.
What a a Binding Prenuptial Agreement Can Contain
The law limits the content of prenuptial agreements to certain prescribed areas, including the property rights a spouse holds upon divorce. The property referenced in a prenuptial agreement is not restricted to the property each party brings into the marriage, but may include property acquired in the future, reflecting the fact that knowing what may/may not be owned at end of the relationship is impossible.
Further, the types of property subject to prenuptial agreements are not constrained to real property, but may take into account personal property, unvested property interests and income/earnings. Illinois law allows couples to include terms in prenuptial agreements that address the following matters:
- The rights and obligations of each party over any property owned by either;
- The right to manage and control property via the purchase, sale, lease, transfer or assignment of rights, among others;
- How property will be treated in the event of divorce, separation or other designated occurrence;
- The ability to modify or eliminate spousal support;
- Whether a will, trust or other estate plan options must be executed to carry out the provisions of the prenuptial agreement; and
- The ownership rights in the death benefits of a life insurance policy.
Note that prenuptial agreements are specifically prohibited from including terms related to a parent's obligation to pay child support.
Given the rights a spouse may give up under the terms of a prenuptial agreement, the law wants to ensure the agreement was entered into fairly and voluntarily. Thus, an agreement could be invalidated if evidence of following is shown:
- A party's consent was not voluntary;
- The agreement was unfair when entered because one party did not receive full financial disclosure from the other, did not waive this disclosure, and had no way of knowing what the other party's true financial obligations were; or
- The provisions on spousal support would cause financial hardship if enforced, which was not foreseeable at the time the agreement was executed. In this situation, a Court is empowered to order support to the extent necessary to avoid hardship.
Contact a Family Law Attorney
Prenuptial agreements are not just for the rich and famous. Anyone entering marriage with children, or someone who has the potential for earning high amounts and/or obtaining sizable property holdings are just a few examples of the kind of individuals that would benefit from prenuptial agreements. Skilled Palatine family law attorney Nicholas W. Richardson helps couples in northwest Chicagoland tackle this difficult discussion, and can help you protect your best interests. Contact the office for a free consultation.