Prenuptial Agreements
By: Attorneys Jennifer Brown and Evan Mayer – Weld Riley, S.C.
What’s mine is yours and what’s yours is mine, right? Not quite —you may want to consider a prenuptial agreement.
A prenuptial agreement is a tool to determine how property is divided in the event of divorce or legal separation and can be a helpful tool setting intentions at death.
Although prenuptial agreements may seem like a necessity only for the wealthy, Wisconsin’s marital property laws may make such an agreement necessary in varying situations. In Wisconsin, all property and debt a couple acquire during a marriage as well as all property and debt brought into the marriage is presumed to be shared 50/50. House, retirement accounts, vehicles, credit cards, mortgages…the list goes on with a few exceptions (which are covered in Property Division at Divorce). One issue a prenuptial agreement can include is how this acquired property will be managed and controlled, as well as each spouse’s rights and obligations to property gained or acquired prior to marriage.
For example, if Sam bought a house prior to the marriage and built $50,000 worth of equity, Sam may want protection from her new spouse, Tim, who is coming in and trying to claim $25,000 of that equity from the moment he says, “I do.” In the same way, if Tim attempts to offload his $200,000 bank loan for his failed business onto Sam during divorce proceedings, a prenuptial agreement could be used to ensure that debt is assigned to Tim with no negative impact on Sam.
Another issue that can be addressed is maintenance (formerly known as “alimony.”) At its core, maintenance is payments from a paying spouse to a receiving spouse following a divorce to help the receiving spouse maintain the standard of living enjoyed during the marriage. Maintenance is commonly a hotly contested issue during a divorce that can prolong divorce proceedings. Prenuptial agreements can set limits on maintenance as to length and amount that is paid.
If the marriage does ultimately end in the death of one spouse, a prenuptial agreement is still beneficial as it can state how property must pass. This is especially important if there are children from previous relationships, preventing family disputes that may arise. Another example would be if Jerry has been running the fourth-generation family farm for 10 years before he marries Barb, he may wish to include a provision that if he dies, the farm goes to his eldest son.
Simply drafting a document and signing it does not mean a court will enforce a prenuptial agreement. Wisconsin has rules to ensure an unfair prenuptial agreement is not enforced. This includes both parties being required to make a full disclosure of their assets and debts as well as getting the opportunity to consult with their own attorney. In other words, going up to your bride and demanding she signs the document moments before she walks down the aisle is not sufficient. Therefore, it is important to begin communicating with your partner and your attorneys well before your wedding day.
In conclusion, although contemplating the marriage’s end before the beginning is not the most romantic, it provides an opportunity to work together to craft a plan for the future. By setting forth terms about how property will be divided, both parties can be protected and go confidently into their marriage together.
There are countless ways that a prenuptial agreement can be drafted to benefit you and your future spouse. The team at Weld Riley, S.C. has experience drafting and reviewing prenuptial agreements, so if your wedding day is approaching, please contact the family law team with any questions.