Why Should I Consider a Prenuptial Agreement?

Many residents of the greater Denver area may think of a prenuptial agreement, which can also be called a premarital agreement, as very unromantic. Others may see these types of contracts as a way for someone who is wealthy and prominent to take advantage of a significant other with less leverage, perhaps in order to make sure that in the event of a divorce, the wealthy person comes out on top.

However, the reality is that any number of Coloradans may benefit from a prenuptial agreement, no matter their financial circumstances. For one, premarital agreements are not exclusively used to protect people from the financial fallout of a divorce or legal separation. Many times, those with children from a prior relationship will want a prenuptial agreement for the simple reason that they can use the agreement to protect those children's inheritances.

Speaking more generally, prenuptial agreements are also good as a supplemental estate planning device, as they can serve to reinforce each party's existing estate plan. Prenuptial agreements are also good for people who own a business or a share in a business like a closely-held corporation, an LLC or a partnership.

A premarital agreement can ensure that a person's spouse, while he or she may be entitled to compensation, must sell the other party's shares of a business back to the business rather than try to assume ownership over an enterprise about which he or she knows little. For this reason, business partners may expect one another to have prenuptial agreements in place.

There are many good reasons why a Colorado resident would want to consider preparing or signing a prenuptial agreement. However, it is important to speak with an experienced family law attorney before doing so.

Tags: Divorce