Choosing a prenuptial agreement is similar to buying a life insurance policy—you hope to never use it, but having it in place offers peace of mind. But what if the worst happens, and a marriage you entered into with hopeful expectations ends in divorce? Exactly what happens when divorcing spouses have a prenup?
A prenuptial agreement in Colorado is a signed legal document created by partners who intend to marry. It typically delineates each spouse’s separate assets and sets parameters for the way spouses will divide and disperse their anticipated marital assets should the marriage end in divorce or the death of one spouse. It may also allocate specific financial responsibilities and expectations for each party during the marriage. A valid prenuptial agreement goes into effect once the marriage occurs.
A prenuptial agreement is only beneficial during a divorce if it’s well-executed, valid, and enforceable in court. This requires the agreement to be in the correct written format and signed voluntarily by both parties without duress. The terms must abide by state law and be fair and reasonable to both parties. Finally, a prenuptial agreement is only valid if both parties made full financial disclosures and did not hide assets. A family lawyer can help you draft a prenuptial agreement before marriage at Ciancio Ciancio Brown, P.C.
Colorado requires divorcing spouses to divide their marital assets in a way that’s fair and equitable. A valid, enforceable prenuptial agreement predetermines how this division occurs. Because it’s created while the partners are at their most loving and generous best, it typically extends generous terms and substantial protection for each spouse’s separate assets.
Prenuptial agreements are most common when one or both spouses have significant separate assets before they enter into the marriage. If one spouse owns a business, has inherited family property or heirlooms, or has amassed a substantial retirement account, a prenuptial agreement can retain those assets as belonging to one spouse, separate from the marital assets. This protects them from division during a divorce.
A prenuptial agreement also protects one spouse from the other spouse’s preexisting debt, for example, student loans, business loans, or gambling debts.
A fair and reasonable prenuptial agreement outlines the division and disbursement of marital assets during a potential future divorce. It also puts a structure in place for the division of bank accounts, retirement accounts, real estate property, vehicles, valuables, and household goods. Depending on the wishes of the parties entering the prenuptial agreement, these assets may be divided 50/50 or they could include specific exchanges such as a vacation home and luxury vehicle traded for the marital home. Often, the prenup also includes terms for dividing marital debts as well as assets.
A well-executed prenuptial agreement commonly addresses spousal support should the marriage end in divorce. Depending on the individual circumstances and wishes of the couple, the agreement could waive alimony completely or include generous alimony paid from a higher-earning spouse to a lower-earning spouse for a predetermined period or until the other spouse remarries.
A prenuptial agreement cannot include terms for child custody in Denver, CO. Instead, the court decides this issue based on the best interests of the child at the time of the divorce either when reviewing a custody agreement developed by the spouses in their parenting plan or by a judge in court. Once a parenting schedule is in place, the state’s formula for calculating child support goes into effect for the divorcing spouses’ child support obligation.
When a prenuptial agreement doesn’t meet the state’s requirements for a valid, enforceable contract, it creates more problems for divorcing spouses than it resolves and can extend the length and contention of the divorce. Call Ciancio Ciancio Brown, P.C. for experienced representation and a well-crafted, enforceable prenuptial agreement offering fair and reasonable protection for both spouses.
