Wisconsin Prenuptial Agreement Attorneys

Things you should consider when making a Prenuptial Agreement

There are many things to consider when creating a prenuptial agreement. Not everyone needs a prenuptial agreement, especially if the engaged, pre-marriage couple owns relatively similar assets of equal values with typical careers, incomes, and respective family structures. Instead, prenuptial agreements are for pre-married people who are especially attached to their property for various reasons, such as its high monetary value, emotional attachment, family inheritance status, or other unique nature. Due to the importance of the person retaining ownership over such property, he or she may want to create a prenuptial agreement to protect what will happen to the property in the event of an unexpected future divorce or death. Without a prenuptial agreement, the person risks losing his or her important property, or at least a significant portion of it, possibly with other serious connected repercussions, to the divorcing spouse. Prenuptial agreements can also be combined with good estate planning, to control where important property is distributed upon death, so that it does not wind up being given to undesirable people, such as estranged family members or unfavorable in-law relatives of a spouse’s family.

1. Classify Individual vs. Marital Property 

   A Prenuptial Agreement’s primary purpose is to determine what property and assets you will classify as your “individual” property upon an unfortunate and unplanned future divorce. Property classified as your “individual” property will be awarded to you in a divorce, rather than your spouse. All other property will likely be classified as “community marital property” under Wisconsin law, and therefore will be split equally (50/50) between you and your divorcing spouse. While no one wants to think about the possibility of a divorce, if you own property that is especially important to you, or that you worked very hard for personally, such as a family inheritance, retirement or savings account, or a successful business – it is wise to make sure such property always remains yours. It must therefore be classified as your “individual” property to keep it beyond the divorce process. 

2. Two (2) Independent Attorneys 

   Due to the fact that prenuptial or premarital agreements are commonly challenged in divorces, by spouses who later change their minds about their promises, confusion or misunderstanding of the prenuptial document’s wording, or just intense, scorned emotions, it is extremely important to have your prenuptial agreement drafted and reviewed by two (2) separate attorneys. Each fiancé should have his or her own independent attorney draft, review, and explain the document to them. The attorney who drafts the prenuptial agreement will likely have the higher fee, and the other attorney who reviews said draft and perhaps provides counter comments will likely have a lower fee. Each attorney should advocate for their client’s best interests, goals, and desires to create a document that is fair to everyone under the circumstances. Failure to secure two (2) independent attorneys to represent the couple’s respective interests in the creation process is a classic and easy way for the prenuptial agreement to be challenged and nullified later by a skilled opposing lawyer in a future divorce court. The prenuptial agreement, like any contract, can be declared invalid if it was signed by people who did not fully understand it or were confused or duped and unfairly pressured into signing it. By each fiancé retaining his or her own attorney, the risk of a party later claiming they were misled or confused when signing it is significantly reduced. 

3. Financial Disclosure Statements 

   Another requirement to strengthen a prenuptial agreement so that it survives any future challenge in divorce court is for each fiancé to create accurate and transparent financial disclosure statements. These statements get attached to the final signed prenuptial agreement and disclose each fiance’s assets and liabilities to the other. This is important so that you and your future spouse are aware of each other’s financial circumstances and dynamics when entering marriage, ultimately so that you both understand the agreement you are signing and the promises it contains. Couples should be honest and open when filling out financial disclosure statements, as lying about or inaccurately identifying property values and debts can cause the prenuptial agreement to be held invalid or struck down by a divorce judge someday. 

4. Prepare Professionally 

   Do not try to create your own prenuptial agreement at home, such as by purchasing a generic version online or attempting to draft it amateurly. Some of what gives a premarital agreement legal strength is its formalities in execution, such as by each spouse having their own attorney review it and attaching accurate financial disclosure statements. This simply cannot be accomplished on your own under nearly all circumstances.  While other contracts, such as a vehicle purchase agreement or residential lease, can often be safely executed without involving lawyers, prenuptial agreements are completely different. The law tends to lean towards and favor itself, meaning that courts and judges are more comfortable with the default 50/50 divorce distribution rule of a couple’s entire community marital property portfolio and strict adherence to intestate inheritance rules after a death. Because of this bias towards the default rules, prenuptial agreements have a history of being successfully overturned and challenged by good divorce attorneys, especially if the agreement is not created properly. Trying to draft the document yourself is an easy target for your opposing, divorcing spouse’s lawyer to exploit someday, making the agreement entirely or partially unenforceable.  

5. Don’t Co-Mingle Individual Property 

   Do not co-mingle any property that you intend to keep as your individual property in a divorce, both before and after you sign a prenuptial agreement. Co-mingling property, such as by combining bank accounts, real estate interests, or business assets with your new spouse, can open your prenuptial agreement up to legal challenges. It is important to keep your individual property titled only in your name, in addition to merely signing a prenuptial agreement. If other property is intended to be community marital property, then it is okay to have your spouse’s name on such assets or engage joint actions concerning it – as it will be divided equally (50/50) upon divorce anyway. You should consult your attorney to discuss how to title unique assets or deal with special circumstances. Co-mingling property creates an argument that the couple later changed their intentions over their original prenuptial agreement, opening up questions as to intent or waiver of either party’s original rights.  The length of time in which property is co-mingled can also be relevant, as courts and judges can be hesitant to pull back property ownership or use from spouses in a divorce if they have been married for a very long time. While a prenuptial agreement can help, it is important not to go down the road of co-mingling individual property and opening yourself up to a potential argument. 

6. Payment Consideration 

   If one of the fiance’s is significantly wealthier than the other, it can sometimes be advised that the wealthier party makes a cash payment to the poorer party when signing the prenuptial agreement. This creates an additional basis to strengthen the document and protect it from challenges in divorce court, by showing that real financial value was paid as “consideration” for the contract. Consideration is the real, bargained-for exchange of promises and property, and is a core requirement for any contract to be legally valid and enforceable. The promise to get married itself is generally seen as a weak basis for contractual consideration in the modern world. By making a real cash payment to the less wealthy spouse upon signing the prenuptial agreement, this problem can be somewhat avoided by bringing in cash or other property to be exchanged – which is respected more for contractual consideration. A more significant payment raises the chances of the prenuptial agreement being honored in the future as well. The parties could also agree to a significant distribution upon the future divorce, but it is still wise to consider making a current payment, especially if the spouses have vastly different financial statuses. 

7. Talk It Over Before Hiring Attorneys

   Having an honest and positive conversation with your fiancé about your goals in creating a prenuptial agreement before contacting lawyers is wise. Prenuptial agreements can be uncomfortable to talk about, and pulling lawyers into the discussion too early may create unnecessary tension and mistrust between you and your fiancé. This could cause you to wind up never creating a prenuptial agreement at all, or worse, harm your relationship. Therefore, come to a verbal understanding at home with your fiancé about the most important aspects of your goals and desires for the prenuptial agreement. Only afterwards should you contact independent attorneys to explain your verbal agreement from home to them. By engaging the prenuptial agreement creation process privately in this order, you will raise the chance that your fiancé actually signs the document with less emotional effects on your relationship. You don’t want your fiancé to be surprised or shocked by the prenuptial agreement, and an unfamiliar lawyer can make this experience even more intense, potentially causing a failure of the venture.