Advantages And Disadvantages Of Prenuptial Agreements.docx

BENEFITS of prenuptial agreements 1.

Partners who do not have any wealth can be protected by a prenup as well especially when the wealthy spouse has a lot of debt. 2. Reasons for prenuptial agreements are to fully disclose and assign assets in specific ways. 3. Pre nuptial can help to alleviate disputes over property when divorce becomes necessary. 4. Premarital agreements have the potential for many benefits not afforded by the default laws. 5. When a divorce does occur, a premarital agreement can prevent many of the stresses, costs, and time delays associated with a divorce. 6. Premarital agreements could even result in fairer outcomes at divorce because couples are usually able to bargain more cooperatively when they are contemplating their marriage rather than ending it.4 7. Perhaps more importantly, premarital agreements may actually prevent divorce by prompting a couple to better define and communicate their expectations at the outset of the marriage. 8. Perhaps more importantly, premarital agreements may actually prevent divorce by prompting a couple to better define and communicate their expectation at the outset of the marriage 9. When both spouses participate fully in financial decisions their own wellbeing, and that of their children, is positively impacted. 10. Contrary to popular opinion, prenuptial agreements are not just to protect the assets of a partner with significantly more assets. Couples of more modest means often use prenuptial agreements to clarify their financial rights and responsibilities during the marriage, or to protect the interests of children from a previous marriage in the case of a subsequent marriage. 11. It is often said that the better you know someone before marriage, the greater the likelihood of marital satisfaction.3

12. Ideally, a prenuptial agreement reflects a couple’s roadmap for their financial future in addition to each partner’s individual desires. 13. One of the most compelling reasons to consider a prenuptial agreement is the existence of a closely held family business or other legacy asset that has helped to define a family. 14. The prenuptial agreement safeguards these bloodline assets from leaving the family due to divorce or death. Examples range from shares in a family business to family heirlooms. 15. To protect the financial interests of older persons with substantial wealth who may be entering into a second or subsequent marriage. 16. To protect the inheritance rights of children and grandchildren from a previous marriage. 17. To protect an inheritance or special asset from going outside the bloodline. 18. To protect a business or professional practice from division, which might require a sale upon divorce. 19. To protect one spouse from taking on debts of another spouse, as when one spouse has significantly more debt than the other (e.g., college loans or excessive credit card debt). 20. To protect one spouse in situations where that person will rely on the other spouse for income (e.g., when one spouse plans to give up a career after the marriage).

DISADVANTAGES OF PRENUPTIAL AGREEMENTS: 1. The process of developing the prenuptial agreement may inadvertently raise concerns regarding trust in the relationship or comfort with the broader family. 2. The agreement may require one spouse to give up the right to inherit from his or her spouse’s estate when the spouse dies. 3. A low- or non-wage-earning spouse may not be able to sustain the lifestyle to which he or she has become accustomed during the marriage if the agreement substantially limits the amount of spousal support to which the spouse is entitled after divorce. It’s fairly typical that life circumstances change over time and they may not be adequately addressed by a prenuptial agreement. 4. It can be difficult to project into the future how potential issues should be handled (e.g., what may seem like an inconsequential compromise between the couple during the romantic premarital period may seem more burdensome or have greater financial consequences over time). 5. The most common criticism of premarital agreements is that they are one sided, unfair, and serve primarily to protect the economically superior spouse (typically the man) to the detriment of the economically inferior spouse (typically the woman) 6. Many, if not most, criticisms of premarital agreements stem from an underlying assumption that women are categorically in a weaker bargaining position in both wanting to marry and in negotiating a premarital agreement. 7.

Can be a trap. Prenuptial agreements can be a trap for some people. In certain cases they can be as a tool to control the partner that is coming into the relationship with less assets.

8.

May be unnecessary. State laws sometimes cover a lot of the issues that are addressed in a prenuptial agreement. Most states also don’t allow certain issues to be resolved through a prenuptial agreement. For example, child support matters have to be resolved through court mechanisms.

9.

Can create burdens. Sometimes circumstances change and people cannot predict what will occur in their lives and marriage. It can be difficult to predict how potential issues should be handled in the future, and what may seem like a compromise at first can seem more burdensome later on.( https://armourlawfirm.com/pros-cons-prenuptial-agreements/)

10. It can be unbalanced.

It’s easy to have tunnel vision when you are first in a

relationship. Many parties sign a prenuptial agreement thinking “I’ll never get a divorce, so what does it matter?” It matters because if you sign a prenup that favors your spouse, you may walk away from the divorce with less than

what you deserve. The key to making sure that your prenup favors each of you equally is for both of you to hire independent attorneys to draft and review the document before you sign it.( https://www.nolo.com/legalencyclopedia/prenuptial-agreement-benefits-drawbacks-29909.html

Prenup around the world link: http://www.internationalprenuptials.com/prenuptial-agreements-around-theworld.html

PRENUP AGREEMENTS IN INDIA India has no law on prenuptial or post nuptial agreements. Such agreements are not common in India and are contrary to Indian customs and views about marriage. Nevertheless, the global publicity about celebrity prenuptial agreements is encouraging more affluent people to consider the idea in India. There appears to be no significant case law in India on the topic of prenups or postnups. Critically, the Supreme Court of India - which is vested with extremely broad power to do justice between the parties and which has been quite active in matters concerning the grounds for divorce -- has taken no stand on the matter of prenuptial agreements. It is therefore essential to understand that while prenuptial agreements might be a valuable way for parties in India to express their intention concerning the nature of their financial relationship, it is not possible to assure - or even to expect -- that such agreed terms will be upheld in an Indian court. International clients should also anticipate that prenuptial and post nuptial agreements entered into while they reside outside India will likely not be enforced if either of them should initiate a divorce case in an Indian court.

Unlike most countries where a valid prenup is legal and binding when a couple separates, the Indian legal system does not recognize this pre-marital agreement. In fact, the concept has gained wide social acceptance over the past five years but till date, it is not a legally valid pact as per the laws of our country. Unlike popular belief, a prenup pact is not meant for the rich and the famous alone. Though divorce is quite common in India now, it is still not considered a possibility before the marriage and hence there is no thought of a pre-nuptial agreement. There is no talk of a pre-nuptial agreement at all as a way of a by-plan as far as the legislation is concerned. There may be a few people talking about the pre-nuptial agreement, but India is far from including it

in its law and legislation plans. Even though we still have a long way to go before pre-nuptial agreements are implemented in India it is a way by which couples can protect their assets in case of a divorce A pre-nuptial agreement helps resolve and simplify a lot of financial and property issues. Since the division of assets are already done before the marriage, implementing what has been decided before the marriage makes life simpler .It just comes down to dividing the assets as mutually decided by the couple and will save nasty arguments later. But a person could get a pre-nuptial agreement drafted abroad, marry in India according to Indian tradition but the agreement will be valid in that particular country only. PRENUPTIAL AGREEMETS AROUND THE WORLD