© 2024 M&T Bank and its affiliates and subsidiaries. All rights reserved.
Wilmington Trust is a registered service mark used in connection with various fiduciary and non-fiduciary services offered by certain subsidiaries of M&T Bank Corporation including, but not limited to, Manufacturers & Traders Trust Company (M&T Bank), Wilmington Trust Company (WTC) operating in Delaware only, Wilmington Trust, N.A. (WTNA), Wilmington Trust Investment Advisors, Inc. (WTIA), Wilmington Funds Management Corporation (WFMC), Wilmington Trust Asset Management, LLC (WTAM), and Wilmington Trust Investment Management, LLC (WTIM). Such services include trustee, custodial, agency, investment management, and other services. International corporate and institutional services are offered through M&T Bank Corporation’s international subsidiaries. Loans, credit cards, retail and business deposits, and other business and personal banking services and products are offered by M&T Bank. Member, FDIC. 
M&T Bank Corporation’s European subsidiaries (Wilmington Trust (UK) Limited, Wilmington Trust (London) Limited, Wilmington Trust SP Services (London) Limited, Wilmington Trust SP Services (Dublin) Limited, Wilmington Trust SP Services (Frankfurt) GmbH and Wilmington Trust SAS) provide international corporate and institutional services.
WTIA, WFMC, WTAM, and WTIM are investment advisors registered with the U.S. Securities and Exchange Commission (SEC). Registration with the SEC does not imply any level of skill or training. Additional Information about WTIA, WFMC, WTAM, and WTIM is also available on the SEC's website at adviserinfo.sec.gov. 
Private Banking is the marketing name for an offering of M&T Bank deposit and loan products and services.
M&T Bank  Equal Housing Lender. Bank NMLS #381076. Member FDIC. 
Investment and Insurance Products   • Are NOT Deposits  • Are NOT FDIC Insured  • Are NOT Insured By Any Federal Government Agency  • Have NO Bank Guarantee  • May Go Down In Value  
Investing involves risks and you may incur a profit or a loss. Past performance cannot guarantee future results. This material is provided for informational purposes only and is not intended as an offer or solicitation for the sale of any security or service. It is not designed or intended to provide financial, tax, legal, accounting, or other professional advice since such advice always requires consideration of individual circumstances. There is no assurance that any investment, financial or estate planning strategy will be successful.

Today a family is not what it used to be; stepparents, stepchildren, half-siblings, even stepsiblings on alternating weekends is hardly uncommon. All the more reason to set financial and legal obligations of a new couple on paper long before anyone says, “I do.”

Prenups can help couples eliminate much of the financial uncertainty associated with setting up a household together. The wealthier spouse may feel confident that his or her assets are secure, while the less wealthy spouse is assured of some property and/or alimony arrangement regardless of the success of the marriage.

 Prenups typically cover three types of provisions: 

  • Divorce or separation: Division of assets owned prior to marriage
  • Divorce or separation: Division of assets acquired during marriage
  • Death: Division of assets among the surviving spouse and other heirs

The Uniform Premarital Agreement Act, which many states have adopted in some form, typically includes guidelines for dealing with issues in a prenuptial agreement related to disposition of property after separation, divorce, or death; alimony; wills; and life insurance beneficiaries.

Legal aspects

While individual states have different laws pertaining to the details of prenups, they basically follow the same general form. An agreement is signed by both parties and witnessed by a notary. These agreements needn’t be filed with a court and can be drawn up by the two prospective spouses without assistance. However, it’s recommended that each spouse obtain expert counsel to ensure that their interests are protected and that the agreement follows the letter of that individual state’s law.

Each spouse should prepare a detailed financial statement when drawing up a prenuptial agreement, including all assets and liabilities, annual gross income, interests in family trusts, and even potential inheritances. Full disclosure ensures that each spouse understands what he or she is getting and giving up, and failure to do so can result in a prenuptial agreement being set aside.

Other reasons why these agreements may not hold up in court include fraud, an unfair agreement, lack of representation or poor representation by counsel, or “ink on the wedding dress” – pressure to sign an agreement within 48 hours of the wedding.

In the absence of a prenup, upon the dissolution of a marriage, community property states will generally divide in half the couple’s assets acquired during the marriage, while other states may make subjective assignments of assets based on years of marriage, status of children, lifestyle considerations, and any number of other factors.  In the case of death, in the absence of a will, assets often transfer to the surviving spouse and/or to the children of the decedent.  However, a prenuptial agreement can allow for the specific assignment of assets to particular individuals—such as the decedent’s children from a prior marriage.

Financial aspects

Prenups may be drawn up to direct various types of arrangements. For example, “maintenance” constitutes the amount of alimony a divorced spouse may receive from his or her wealthier counterpart. 

Another financial arrangement may include the preservation of a business, family assets, or family fortune held prior to the marriage, to ensure that those assets stay with the original owner should the marriage end in divorce. In many cases, a wealthy family will want to ensure that assets gifted to an adult child do not become the property of the non-blood-related spouse in the event of divorce. 

However, it’s important to recognize that no state will automatically adhere to an agreement concerning custody, visitation, or child support arrangements included in a prenuptial agreement. These matters will always be revisited during divorce proceedings, and such arrangements may be set aside at the discretion of the court if determined not to be in the children’s best interests.

Prenuptial agreements can be instrumental in helping to provide an orderly process if the marriage ends. From this legal and financial foundation, marital bliss may ensue.

This article is for informational purposes only and is not intended as an offer or solicitation for the sale of any financial product or service. It is not designed or intended to provide financial, tax, legal, investment, accounting, or other professional advice since such advice always requires consideration of individual circumstances. If professional advice is needed, the services of a professional advisor should be sought.

Disclosures:

    • © 2024 M&T Bank and its affiliates and subsidiaries. All rights reserved.
    • Wilmington Trust is a registered service mark used in connection with various fiduciary and non-fiduciary services offered by certain subsidiaries of M&T Bank Corporation including, but not limited to, Manufacturers & Traders Trust Company (M&T Bank), Wilmington Trust Company (WTC) operating in Delaware only, Wilmington Trust, N.A. (WTNA), Wilmington Trust Investment Advisors, Inc. (WTIA), Wilmington Funds Management Corporation (WFMC), Wilmington Trust Asset Management, LLC (WTAM), and Wilmington Trust Investment Management, LLC (WTIM). Such services include trustee, custodial, agency, investment management, and other services. International corporate and institutional services are offered through M&T Bank Corporation’s international subsidiaries. Loans, credit cards, retail and business deposits, and other business and personal banking services and products are offered by M&T Bank. Member, FDIC. 
    • M&T Bank Corporation’s European subsidiaries (Wilmington Trust (UK) Limited, Wilmington Trust (London) Limited, Wilmington Trust SP Services (London) Limited, Wilmington Trust SP Services (Dublin) Limited, Wilmington Trust SP Services (Frankfurt) GmbH and Wilmington Trust SAS) provide international corporate and institutional services.
    • WTIA, WFMC, WTAM, and WTIM are investment advisors registered with the U.S. Securities and Exchange Commission (SEC). Registration with the SEC does not imply any level of skill or training. Additional Information about WTIA, WFMC, WTAM, and WTIM is also available on the SEC's website at adviserinfo.sec.gov. 
    • Private Banking is the marketing name for an offering of M&T Bank deposit and loan products and services.
    • M&T Bank  Equal Housing Lender. Bank NMLS #381076. Member FDIC. 
    • Investment and Insurance Products   • Are NOT Deposits  • Are NOT FDIC Insured  • Are NOT Insured By Any Federal Government Agency  • Have NO Bank Guarantee  • May Go Down In Value  
    • Investing involves risks and you may incur a profit or a loss. Past performance cannot guarantee future results. This material is provided for informational purposes only and is not intended as an offer or solicitation for the sale of any security or service. It is not designed or intended to provide financial, tax, legal, accounting, or other professional advice since such advice always requires consideration of individual circumstances. There is no assurance that any investment, financial or estate planning strategy will be successful.

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