There is a large misconception that prenuptial agreements are only for the rich. However, this is not true. Prenuptial agreements can be drafted for multiple reasons and purposes. With the divorce rate hovering around 60% today, a prenuptial agreement is a good tool to protect a spouse in case “I do” turns into “I don’t.”
Prenuptial agreements can be drafted to be broad and cover many issues or situations, or be narrowly tailored to address one or only a few issues. Some reasons to enter into a prenuptial agreement are:
To protect a substantial inheritance or an interest in a trust;
To protect an interest in a business;
To provide for children from a previous relationship;
To protect against a large disparity in assets or income between the two parties;
To protect or segregate a specific asset;
Your family is prone to divorces, and you would like the agreement “just in case”;
To address whether your future spouse will inherit from your estate;
To decide how to split assets obtained before the marriage;
To determine whether there will be alimony in the event of a divorce; and
To determine who will be responsible for debts incurred by each party prior to the marriage.
These are only a few examples of why parties enter into prenuptial agreements. There are many reasons, in addition to what is outlined above, and typically depend on each parties’ specific circumstances.
Regardless of the reasons for a prenuptial agreement, the agreement must meet certain standards under Massachusetts Law in order to be enforceable. The Massachusetts Supreme Judicial Court case DeMatteo v. DeMatteo outlines what is required for a Massachusetts prenuptial agreement to be legal. First, the agreement must be fair and reasonable at the time of execution. Secondly, the agreement must be fair and reasonable at the time of entry of the judgment of divorce nisi.
Massachusetts law also requires that a couple to a prenuptial agreement make a full and truthful disclosure of their respective assets and liabilities. This ensures that there are no secrets or surprises at the time the couple is married, and later if and when they divorce.
If, after a couple marries, they feel they need to protect themselves, and they do not have a prenuptial agreement, they can consider entering into a postnuptial agreement. Postnuptial agreements are similar to prenuptial agreements, but have slightly different standards.