Do You Need a Pre-Nuptial Agreement?
The law in Michigan is usually adequate to fairly divide married person’s assets and debts in the event of a divorce. In Michigan, any property owned by a person before the marriage or inherited by a person is almost always that person’s property separate from the marital property that gets divided in the divorce.
In Michigan, the real value in a pre-nuptial agreement is in defining how income, assets, and debts will be managed by the parties during their marriage. This is important where one party earns most of the income or has wealth prior to the marriage. It’s simply a mechanism for the future spouses to have a crystal clear understanding about how their wealth will be treated during the marriage and in the event of a divorce.
We often meet with clients who are seeking a pre-nuptial agreement at the insistence of their adult children, who are insecure about losing their inheritance to mom or dad’s new spouse. The drafting of a pre-nuptial agreement can sometimes quiet those persons who believe they have an interest in mom or dad’s estate.
We also often meet with clients who are seeking a pre-nuptial agreement where there is a great disparity in income between the future spouses. Consider the surgeon who has spent considerable time, effort, and expense to build up her practice and has become a highly successful practitioner. This surgeon may have a business to protect and an annual income in excess of $500,000. What if she wants to marry a college student who hasn’t garnered this success for himself? What if the future wife is much older than the future husband? Under these circumstances, a pre-nuptial agreement may help the parties plan their economic future together without the pitfalls of extensive arguing over who brings more economic value into the marriage.
What if your spouse moves to California, or Las Vegas, or England, and then sues you for divorce? Under these circumstances, a pre-nuptial agreement may have huge consequences because there are jurisdictions, unlike Michigan, where a spouse gains an interest in pre-marital property.
If a pre-nuptial agreement is a concern for you, discuss the subject early in your engagement, and contact us for a free consultation. We’ll be happy to help you and your future spouse draft a pre-nuptial agreement that is well-understood and meaningful.