Money problems are one of the biggest causes of ending a marriage. A prenuptial agreement may be one method to prevent divorce by setting forth a financial plan and expectations. If there is ever a divorce, this contract can govern property division and other legal matters instead of a court.
A prenuptial agreement may be especially important in California because it is a community property state. Any new property or assets obtained after marriage belong to both spouses and may be divided equally at divorce.
A prenuptial agreement can also protect the higher earning spouse because community property states generally favor the lower wage earner. That spouse may still receive half of the couple’s assets even though they made a comparatively smaller financial contribution to the marriage.
A California prenuptial agreement may address, in addition to property division, the rights and duties of each spouse. It often covers spousal support by assuring that a lower earning spouse is entitled to alimony or, that spouse can also waive that support.
A prenuptial agreement must be in writing and signed by both parties. Each person should provide full financial disclosure about real estate and personal property, the fair market value of their property, and assets, debts and credit liabilities, among other things.
They must enter the agreement voluntarily. Undue influence or coercion upon either party may invalidate the agreement. An independent lawyer should represent each party unless they sign a waiver containing notice that they were informed of this right and surrendered it voluntarily.
The parties must agree that California law will govern any disputes or legal issues or that the divorce will be filed in this state. One spouse must also live in the state for at least six months.
A prenuptial agreement may not govern child support or custody. California courts decide custody and children’s rights according to the best interests of the child standard.
A prenuptial agreement may cover more than a divorce. It can be helpful for asset planning and govern the disposition of property, real estate, money, and life insurance when a spouse dies. It has been used to help protect inheritance rights for children from an earlier marriage.
An attorney can represent parties and help draft a fair and reasonable agreement. They may also assist with making any changes to the agreement after marriage.