If you’re planning to get married, you may be wondering whether you need a prenuptial agreement (or “prenup” for short). Before you make that decision, you should understand what a prenup is, what it can and can’t do, the most common reasons couples choose to sign these agreements, and what makes a valid prenup.

• What Is a Prenup?
• Who Needs a Prenup?
• If You Don’t Make a Prenup
• Making a Valid Prenup
• How to Draft Your Own Prenup

What Is a Prenup?

A prenuptial agreement is a written contract created by two people before they’re married. Typically, a prenup lists all of the property each person owns and debts they owe, and it spells out each person’s property rights during the marriage and in the event that they later get divorced..

Who Needs a Prenup?

Contrary to popular opinion, prenups are not just for the rich. While premarital agreements are often used to protect a wealthy spouse’s assets, couples of more modest means are increasingly turning to them for their own purposes. There are many reasons some people want a prenup, including:

• Pass separate property to children from prior marriages. A couple with children from prior marriages may use a prenup to spell out what will happen to their property when they die, so that they can pass on separate property to their children and still provide for each other, if necessary. Without a prenup, a surviving spouse might have the right to claim a large portion of the other spouse’s property, leaving much less for the kids.
• Clarify financial rights. Couples with or without children, wealthy or not, may simply want to clarify their financial rights and responsibilities during their marriage. For instance, they may spell out how they’ll manage joint bank accounts, credit cards, household bills, and savings. Or they may want to spell out their respective obligations when one spouse plans to put the other through college or a professional degree program.
• Avoid arguments in case of divorce. No one wants to think about divorce when they’re about to get married, but many couples recognize that it’s a possibility. So they might want to avoid potential arguments in a future divorce by specifying in advance how they’ll divide their property, and whether or not either spouse will receive alimony. However, it’s important to know that a few states won’t allow a spouse to give up the right to alimony. And in most other states, judges will look closely at a waiver of alimony and won’t enforce it if the spouse who agreed to give up alimony didn’t have a lawyer.
• Get protection from debts. Couples may want to use a prenup to protect themselves from each other’s debts, especially school loans and medical debt.

If You Don’t Make a Prenup

If you don’t make a prenuptial agreement, your state’s laws determine who owns what property during your marriage, as well as what happens to separate and marital property in divorce or when one spouse dies.

Under the law, marriage is considered to be a contract between the marrying couple. With that contract comes certain automatic property rights for each spouse. For example, depending on the state laws, a spouse usually has the right to:

• share ownership of most property acquired during the marriage, with the expectation that the property will be divided between the spouses if they divorce
• share responsibility for either spouse’s debts incurred during the marriage, and
• share in the management and control of marital property (or community property in states that follow community property rules), sometimes including the right to sell or give away the property.

If your state’s laws on marital or community property aren’t to your liking, it’s time to think about a prenup. In most cases, a prenup will allow you to decide for yourselves how you’ll deal with your property.

Making a Valid Prenup

As prenuptial agreements become more common, the law is becoming friendlier toward them. Traditionally, judges scrutinized prenups with a suspicious eye, because they almost always involved a waiver of legal and financial benefits by a less wealthy spouse.

As divorce and remarriage have become more prevalent, and with more equality between the sexes, courts and legislatures are increasingly willing to uphold premarital agreements. Today, every state permits them. But judges will still set aside agreements that are unfair or otherwise don’t meet state requirements for prenuptial agreements.

Because judges look carefully at prenups, it’s important that you negotiate and write up your agreement in a way that’s clear, understandable, and legally sound. If you draft your own agreement, both you and your spouse should have separate lawyers review it and at least briefly advise you about it. In fact, some states require this independent legal review. And even if it’s not a requirement, judges are more likely to question the validity of a prenup if each spouse didn’t have independent legal advice before they signed the agreement.