By Jedidiah McKeehan
A fairly common legal term that you may have heard of is a, “pre-nuptial agreement,” or the shortened version of that term, “pre-nup.” But what actually is a pre-nuptial agreement and what is contained in that agreement?
First, let’s break down the term, “nuptials.” It is not an often used phrase, but nuptial, means, “a wedding.” Therefore, a pre-nuptial agreement, is an agreement entered in to by individuals prior to a wedding.
For what purpose would individuals enter in to such an agreement?
So, when the normal individual thinks about marriage, they think about two individuals in a relationship where their plan is to share everything that they have, and that they will have, for the rest of their lives. Whether it’s a house, a car, a boat, or even a stamp collection, we think about those items that the two people have as belonging to both of them, and those items being considered, “marital property.”
And the law states, that when individuals get divorced, the “marital property,” is to be equitably divided. Now equitably does not necessarily mean equal, but an equal division of marital property during a divorce is often what happens.
To go back to our original question though, a pre-nuptial agreement is designed to control the division of property between a married couple should a divorce occur in the future, instead of leaving that division in the hands of a judge.
Say a couple is considering getting married and the woman has $500,000.00 in the bank in an account with just her name on it. Also, the man has three rental properties that are deeded in just his name. Even though these two love each other, they may decide that they want these items to be considered their separate property, and not subject to a division by the court, should they later get divorced.
Now it may be possible for them to keep these items as separate property simply by never placing that money in a joint account, or deeding those properties to each other jointly, however, the safest way to have assets not even a consideration in a division of marital property is for a pre-nuptial agreement to be drawn up and signed by the parties prior to the wedding, that lists out all of their separate assets and the parties intent to keep those assets as separate property, and not marital property.
For most marriages, a pre-nuptial agreement is not even a consideration, but when the couple considering marriage, has significant assets, or they have been married multiple times previously, a pre-nup may be something they are considering, or should consider.
Jedidiah McKeehan is an attorney practicing in Knox County and surrounding counties. He works in many areas, including criminal, personal injury, landlord-tenant, probate, and estate planning. Visit attorney-knoxville.com for more information about this legal issue and other legal issues.