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Prenuptial agreements and what they should cover

A prenuptial agreement (pre-nup) that sets forth the division of assets, debts and lifestyle agreements may eliminate many family law problems following a California divorce. It can help protect a spouse's assets and eliminate a dispute, if the relationship ends.

A pre-nup allows a couple to agree on finances and family matters, instead of a court imposing its ruling during divorce. Prenuptial planning should start as a general discussion of finances, and then evolve into specific topics, such as division of wealth, spousal support and debt. It may also serve as a means for a couple to engage in meaningful financial planning and disclose their assets and liabilities.

Debt is also extremely important. Normally, the property that each spouse brings into their marriage is considered as their individual assets. However, both spouses may be responsible for debt, like college loans, which accumulated during marriage if this issue is not addressed in the prenuptial agreement.

These agreements may also address lifestyle issues. Spouses can agree on custody of the family pet. Other, more intense issues, may include lump sum payments for marriage infidelity.

Couples, under some circumstances, may consider a gag order clause. This may be advantageous where a spouse wants to protect an established brand, reputation or business from disparaging comments. Likewise, a couple may agree to a goodwill clause, which prohibits the spouses from publicly criticizing or insulting each other.

Social media clauses are becoming more prevalent. These usually forbid spouses from sharing humiliating photographs and information or making critical comments on social media. One reported agreement imposed a fine up to $50,000 for violating this term.

Lifestyle clauses, however, must be drafted carefully. A judge may invalidate a clause that violates California law, is legally unenforceable or which is considered trivial.

Couples may also consider entering a post-nuptial agreement after marriage. These can be updated to deal with lifestyle changes during marriage, such as the sale and purchase of property, moving outside California or having children.

A spouse entering marriage and considering a prenuptial agreement should have their own attorney. A lawyer can assist with protecting their property and rights and forging a reasonable and fair agreement.

Source: Money Magazine, "Why you should get a prenup even if you're young and broke," Erin Lowry, June 2, 2017

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