If you have smartly decided to get a prenuptial agreement, also called a prenup, before you marry, there are many areas prenups should cover. You can cover as few or as many of the items as you want. Some of the items may not be relevant to your situation. Be sure that if you follow the list, you will cover most of the key issues.
Prenups should cover
1. Decide how all of your debts will be handled. This includes those debts incurred before you are married and those incurred after you are married.
2. Make sure you disclose all of your assets, liabilities, sources of income, and any other potential future assets, such as gifts or inheritances.
3. Should you divorce or die, decide who will get your primary residence or any vacation homes.
4. Determine what will happen to any assets or property you bring to your marriage. Normally, this will be separate property. But you need to agree with your soon-to-be, what will happen to any post-marriage appreciation, earnings, or proceeds of that property.
5. Figure out what will happen, if you divorce or die, to any assets or property you acquire after you get married.
6. Clearly state what will happen to each specific type of property, either community or separate. For example, real estate, antiques, jewelry, stock options, and accident settlements.
7. Determine the status of any gifts or bequests you receive, either before or after marriage. These should be separate property, but questions may arise when a gift is given to a couple after marriage. A good example is a gift by one spouse’s parents of a down payment on a house. Is that a gift to the couple or just to their child.
8. Although any provision for child support won’t be binding later, you can provide for spousal support (alimony) in your prenup.Understand what is reasonable for both the payor and the receiving spouse.
9. Set forth the beneficiary of all retirement plans (e.g. 401(k)s, pensions, IRAs) in the event of your death. Also, clarify how the plans will be divided upon divorce.
10. Clarify who will provide health insurance for your children and how the costs will be shared.
11. Clearly state what state’s laws will apply and how a move to another state will affect the prenup.
12. Make sure your attorneys are identified. Have them explain each provision in the prenuptial agreement and try your best to understand what it all means. Don’t be afraid to ask questions.
13. Agree upon what happens to your pets in the event of your divorce. Who gets custody and will there be visitation rights?
14. Include a clause that requires the one who challenges the validity of the prenup to pay all of the other spouse’s fees, regardless of the outcome. You can also make the challenger give up something of value they might be getting under the prenup.