Getting Married? You Should Think About Prenuptial or Marital Agreements.
In the right circumstances, a Marital Agreement, as Prenuptial Agreements are called in Colorado, can be the difference between an agonizing, expensive divorce, and a smoother, less fraught divorce.
As the average age at which people marry continues to increase, their finances at the time they marry often also become more complex. Marrying after you’ve already been in the professional world for a time means that you’re more likely to own large assets like a house, or houses, maybe a ski condo, or have large sources of debt. These assets and liabilities, which may grow in value (or become a greater debt) during the course of the marriage make it more important than ever to determine before marrying how you might wish to handle a division of assets, in the unfortunate event that you end up filing for divorce.
It’s important to remember that prenuptial agreements are customizable. They do not have to govern all assets possessed or earned by the couple. If you’re concerned about a particular source of debt of your spouse that seems to be growing, or if you’re the owner of a large asset (such as a house, a business, or a particularly robust financial account) and would like to remain the only one entitled to the appreciation in value on that asset, you can exclude those items from becoming marital property. You can also outline how the marital property would be divided in a manner that more accurately reflects the greater contribution of the spouse who earns more. It’s valuable knowing the difference between marital and separate property, and how that characterization may impact a divorce, with, or without, a marital agreement.
Marital Agreements may also impact what happens at one of the spouse’s deaths. Intestate succession is interrupted by a well-crafted Marital Agreement. Homestead exemptions, elective shares, family allowances, and related probate issues can be addressed in a Marital Agreement giving the entire extended-family some future resolution as a planning tool for death.
Investing in a prenuptial agreement could result in saving money down the road on additional legal expenses, when, in the midst of a divorce, tempers and emotions are high. Timing, they say is everything. This certainly applies to marital agreements. Knowing, with some legal certainty, how assets will be divided in ten or fifteen years, at the later divorce, is invaluable.
What is a Prenuptial, Post Nuptial, or Marital Agreement
A marital agreement, whether signed prior to marriage, or signed during the marriage, allows parties to control the future of their existing and future assets, and existing and future debts, should divorce occur down the road. The Agreement allows one spouse to understand what rights they waive during the marriage or at death, and the other party to know what happens to their assets and debts if divorce later occurs, or at death.
Colorado is very progressive as it relates to Marital Agreements. Colorado classifies a prenuptial agreement and a post-nuptial agreement in the same manner—marital agreements. Colorado has codified the Uniform Premarital and Marital Agreements Act, the “UPMAA”, one of only a few states that has done so. This has brought more certainty to the result of a contest of a marital agreement. See 14-2-302 et seq.
A marital agreement may include language about children, like parenting time, or custody issues, but these remain subject to the court’s jurisdiction. The court may consider the agreement’s terms, but is not bound to adopt them, whatever they are.
Requirements for Marital (Prenuptial) Agreements under Colorado Law
There may be ways that the Marital Agreement would not be found valid under Colorado State law, such as if the agreement lacks voluntary consent or was the result of duress; there was no access to independent legal representation; there was no waiver or explanation of what rights are being waived; and, lastly, inadequate financial disclosures.
Maintenance (alimony) and attorney fees are subject to review by the court, depending upon the circumstances at the time of the divorce. Maintenance and fees are subject to what is essentially an “unconscionability” standard at the time of divorce.
Whether you should do a marital agreement, When to do a marital agreement, What to expect if it’s challenged at the later divorce, Understanding the law—that all takes knowledge and experience.
An experienced family law attorney would be able to describe all the requirements the agreement must meet to be found valid. If you would like professional guidance in designing a marital agreement that would leave both parties feeling secure in the event of a divorce, contact an experienced family law attorney to assist you. For a consultation on your marital or prenuptial agreement in and around the Denver area, call the Centennial, Colorado Law Offices of Kenneth Brock at 720-493-8808.