By: Olivia Smith
A misconception exists surrounding prenuptial agreements-that only rich or famous people need or should get them. You don’t have to be rich or famous to need a prenuptial agreement, you just need to have a current interest or future interest (such as inheritance or business appreciation) you want to protect.
Here are some reasons individuals contemplating marriage should consider a prenuptial agreement:
- Default Ohio law states all marital property – which means anything accrued during the marriage with marital funds – is divided 50/50. It doesn’t matter whose name it is in or whose job the money came from, it is a 50/50 division. For example, “Saver Spouse” could put a lot away for retirement, whereas “Spender Spouse” could be a shopper and spend all of his money on himself (and saves nothing). In a divorce, Saver Spouse would have to pay Spender Spouse half of the retirement balance.
- For marriages later in life, a prenuptial agreement can protect the spouse’s separate property interest. While Ohio law states property owned prior to the marriage is a separate asset, meaning that it is not divided 50/50 in divorce, the person asserting a separate interest has the burden of proof. If the parties have been married for years or decades, this burden of proof can be challenging. For example, obtaining prior bank statements may be difficult if not impossible. If you cannot prove an interest is separate, the asset may be divided in a divorce. By signing a prenuptial agreement which lists the property you own before the marriage, you have evidence of your separate property interests.
- Blended families often involve parties who have children from other relationships. Entering into a prenuptial agreement allows parties to agree to alter their rights relating to their estate which would allow the parties to leave some or all separate property to their children and not their spouse.
A prenuptial agreement allows you to alter your marital contract from default Ohio law. Think of it as an estate plan for your marriage.