California is a community property state, which means that by law, once you are married half of all earnings, property accumulated from earnings as well as appreciation of assets, belongs to your spouse in the event of separation or death. A Prenuptial Agreement will protect you from the legal ramifications that will otherwise be decided by the court in the event of a dissolution of your marriage. Crafted and specified to meet your specific needs, the terms of your agreement can predetermine what assets you want to remain separate and those you would like to be shared. Prenuptial agreements are an excellent way to help couples avoid a lengthy battle over property if the relationship ends in divorce.
The following are key features most commonly used in Prenuptial Agreements:
Identify and define what is separate and community property
Separate property includes the assets you own before your marriage and also includes gifts or inheritances. Community property is defined as assets purchased or acquired by a couple during their marriage that are owned equally by both of them.
Identify and define what is separate and community debt
Your agreement will identify separate and community liabilities and how you will determine what debt is separate and what debt is part of the community. Prenuptial agreements are helpful if one spouse brings a significant amount of debt to the relationship. This feature will allow you to ensure that you won’t be responsible for your partner’s debts going into the future.
Establishing terms of Spousal Support (alimony)
Including a waiver of spousal support in your prenuptial agreement will allow you to decide upon the terms of separation as they relate to spousal support payments, also known as alimony. Otherwise these decisions are made by the court and the outcomes are uncertain.
Other common benefits of a Prenuptial Agreement:
- Supporting your estate plan and avoiding court involvement to decide property distribution.
- Protections for your family’s property.
- Documenting and detailing any special arrangements between you and your spouse.
- Avoid extended court proceedings, which results in the time of expensive divorce attorneys.
- Reducing conflicts during a divorce.
- Establishing procedures and rules for issues that may arise in the future.
- Provisions providing for children from previous relationships.
- Including a sunset provision that designates a certain point in time when the prenup will no longer be in effect.