So you’ve decided to get a prenup — congratulations!
Establishing a prenuptial agreement with your spouse-to-be is a critical step towards empowering your marriage with responsible financial planning and conversations.
Creating a prenup may feel daunting, but it’s worth the hard work. It helps to view it broken down into three key parts:
- Start the Conversations About Money
- Create your prenup “wishlist”
- Talk to a prenup attorney
In this guide, I outline the significant topics to consider and provide a starter prenuptial agreement checklist to kick off your marital journey on the right foot.
Let’s get started.
Step 1: Start the Conversations About Money
Initiating a conversation about a prenuptial agreement before the wedding date can be delicate, but it’s a crucial first step. Most people don’t realize marriage is a legal and financial commitment, so it’s vital to begin with open, honest, and respectful discussions about your financial expectations and concerns in the marriage.
Use the Talking Money Conversation Guide to better understand each other’s relationship to money, how finances play a role in your lives together, and how each of you defines value.
This is a learning opportunity. Ask each other how you were raised to view money from a cultural, familial, and even religious perspective.
Did you grow up saving or spending frivolously?
What big purchases have you made in the past, and why did you make them?
Approach these money talks leading up to your prenuptial agreement as a collaborative task, where you and your partner give each other sufficient space to voice your concerns or opinions about managing finances in your marriage.
A prenup shouldn’t be an adversarial process — both partners should walk away feeling respected and stronger in their relationship. In fact, to hold up in court, the prenup must be signed in good faith by both parties — free of coercion or trickery.
Step 2: Create Your Prenup “Wishlist”
Next, you’ll get into the nitty gritty of which clauses to include in your prenup.
Remember that this is your prenuptial agreement, so customize it to your relationship’s specific wants and needs.
Having said that — here are the main topics to take into consideration:
Premarital Assets & Debts
Premarital assets and debts are anything owned (or owed) by you or your partner pre-marriage are generally “separate property”.
In many states, like California, once you legally marry, almost everything you purchase during marriage is considered marital property (or community property) shared jointly with your spouse – meaning, your property is subject to a 50/50 split with your spouse in the event of a divorce. In addition, in some circumstances, the community can even gain an interest in your separate property during marriage. The best way to ensure that your separate property remains separate is to define it as such in your prenup.
List out all of the current assets and debts that each partner owns. These may include houses, apartments, properties, cars, boats, money in individual accounts, student loans, and credit card debt.
Honesty is paramount here. Don’t hide, lie, or misrepresent assets or debts to angle for an advantage. The truth will come out eventually, and your prenup could be deemed invalid when it does.
Essentially, list anything solely belonging to you (objects, money, debts, or otherwise) to provide a bird’s eye view of your current financial position.
Once you have shared your existing finances with each other, you can decide how these assets and debts will be impacted post-marriage.
Will you retain sole ownership of your apartment in the city?
Are you willing to commingle debts and pay them off jointly?
In sum, clearly define how premarital assets and debts will either remain separate property, become community property, or possibly a hybrid of both.
BEFORE getting married, what conversations about MONEY should you have with your partner?
Use this guide to discuss budgets, assets, debts, goals, joints bank accounts and more.Get the guide
Future Property, Income, & Debts
Similarly, consider how you’ll handle future property and assets (e.g., business interests, large purchases, and intellectual property) acquired during your marriage.
Will you buy a home together and define it as joint property? Or will it only be owned by the person buying it? What funds do you expect to use to purchase the property?
If you plan to start a business during marriage, will it be a joint asset or your separate property? Will you share the profits with your spouse in a joint account or keep them to yourself?
Or perhaps you’ve been writing a book for years, and hope to publish it during marriage. Will your spouse be entitled to a portion of the income from your book sales? Will the intellectual property tied to the book be your separate property, or will it be community property?
Conversely, how will debts from a potential business venture be divided? Is your spouse willing to take on some of these debts, or would you prefer to keep them separate?
Detail your anticipated property, income, and debts acquired and/or established during marriage in your prenup to clarify expectations around dividing projected income, assets and liabilities.
Beyond planning for your current and anticipated income, you’ll want to discuss the how of financial responsibilities.
For example, is one of you better at balancing the books than the other?
What are the expectations around daily, weekly, and monthly spending?
Will you keep separate bank accounts?
If one person wants to make a purchase from a joint bank account, how much can either of you spend without having to talk to your partner first?
It’s advantageous to have these conversations and nail these points down in a prenup wherever possible so there aren’t any surprises when it comes to spending and saving.
It’s important to clarify expectations around spousal support, especially if one partner is going into the marriage with significantly less income or professional opportunity than the other.
It’s not uncommon for one spouse to be financially disadvantaged during a divorce.
Thus, it’s advisable to discuss a plan for how much the higher-earning spouse will support the lower-earning spouse during and after a divorce.
Having kids may not be top of mind when you’re engrossed in wedding planning, but you’ll thank yourself for having the conversation with your partner.
In particular, you should consider if one partner will take time off from work to care for potential children, and if so, will they be given an allowance to supplement their lost income?
Discussing children clarifies your respective standings on family planning expectations while ensuring the stay-at-home spouse can maintain a level of financial independence.
One thing to note is that a prenup cannot cover child custody nor support.
Family Gifts & Inheritance
Talk to your partner about whether you expect to receive a monetary gift from a family member (like a down payment on a house) or if you’re in line for a family inheritance. Your prenup can include specific clauses defining how such gifts or inheritances may or may not be split with your spouse.
Death & Disability
Talking about death before you’re even married isn’t exactly sexy, but it’s a valuable discussion. Having a plan in place for both partners, should something unthinkable happen, alleviates stress and heartache.
Here are questions to ask:
Do you have an estate plan in place?
Are there specific beneficiaries that should receive certain assets?
How will financial management change if one partner becomes disabled?
Your prenup can act as a jumping-off point for asset distribution and planning and point to estate plans and trusts, giving extra assurance that your property is distributed to your wishes.
Additional considerations include deciding who gets the pets in the event of a divorce, guardrails on what you can share on social media, higher education plans, and tax filing status.
Step 3: Talk to a Prenup Attorney
Once you’ve talked through the key points of your prenup, it’s time to engage with a qualified attorney, specializing in prenups. Don’t retain your estate or business attorney thinking they’ll write a solid prenup. They may not know the ins and outs, putting your prenuptial agreement at risk when you may need it. You also may not want to hire a divorce attorney – they’ll treat your prenup like a divorce before you’re even married.
Even the smallest mistake can render a prenup void in a court of law.
Prenup Checklist at a Glance
Here’s a list of topics and discussions to consider when planning out your prenup:
- Premarital assets & debts
- Property & Businesses acquired during marriage
- Income & debt acquired during marriage
- Income & asset management
- Spousal support
- Family planning
- Family gifts & inheritance
- Retirement goals
- Death & disability
- Pet ownership
- Social media guidelines
- Higher education
- Filing taxes
For a detailed guide on prenuptial agreements, check out my Prenuptial Agreement Planner. This comprehensive workbook walks you through the most important questions to consider for your prenup.
You can also find further resources on the blog or by booking a consultation appointment. I’m an experienced family law attorney passionate about walking couples through prenups to set them up for long-term marital success.