We’ve all heard the Kanye West lyric “If you ain’t no punk, holla we want prenup!” But what was he talking about and why was it important to the song? Prenuptial (also known as premarital) agreements are contracts that are entered into by future spouses before they are wed. The reasons a couple may to enter into a prenup vary, but they are usually used to define how property will be divided in the event of a divorce.
Texas is one of nine community property states. This means that anything earned, bought, or comingled during a marriage is the community property of that marriage. Community property in Texas is usually split between the soon to be ex-spouses in a manner that is considered to be just and right. This usually takes the form of a half and half split. There are exceptions to these rules, but I will discuss those in a future article. A prenup can prevent its listed assets from being divided and split with your ex-spouse. For example, say you have a $5 million stock portfolio, you would obviously prefer that it and its growth during the marriage stay 100% your property after a divorce. What you would need to do is disclose this asset to your would-be spouse and insert a clause in the prenup stating that in the event of a divorce, your portfolio and any growth it gains during the marriage shall be consider your separate property.
Many people don’t like the idea of a prenuptial agreement as they believe it is planning for a failed marriage or only done for selfish reasons, but that is not the case. Nobody plans on getting in a car wreck, but it’s important to have car insurance if it happens. You can also protect your spouse in a prenup just as easily as you can protect yourself. Just like assets and income, debt accumulated during the marriage is also considered community property. With a prenup, you may also include provisions to shield your spouse from any debts you may accumulate through the marriage.
Additionally, you can simply include provisions as to how you want certain things done in your marriage. Of course, whether some provisions will be enforceable by the court is another question entirely. While you may insert a clause that states how many children you will have and how they will be educated, you aren’t likely to get away with a clause that says you will have all boys by a date certain or the marriage is void.