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If you earn a large income or own valuable assets, you will want to make sure you are financially protected if you or your spouse choose to pursue a divorce. In many cases, the best way to protect yourself from financial losses in a high net worth divorce is to make decisions ahead of time about how certain issues will be handled. A prenuptial agreement, which you and your partner can sign before getting married, will allow you to specify how you will handle the division of community property if your marriage ends, as well as other matters related to your finances.

To be valid and enforceable, a prenuptial agreement (also known as a “prenup”) must be in writing, and it must be signed before you get married. Both spouses must also provide each other with a fair and reasonable disclosure of their finances, including the property they own, the income they earn, and the debts they owe. A spouse can waive their right to receive a financial disclosure from the other party, but this waiver must be completed before the prenup is signed.

What Decisions Can a Prenuptial Agreement Make?

In Texas, a prenuptial agreement is also known as a “marital property agreement,” and it can include decisions related to the ownership or disposition of the couple’s property, including community property or separate property owned by either spouse. A prenup can define each party’s rights and obligations toward their property during their marriage, including the right to buy, sell, lease, transfer, or use physical property, real estate, financial instruments, or anything else owned by either or both spouses.

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TX high asset lawyerPrenuptial agreements are a common legal tool used to avoid protracted litigation, particularly in the event of a high-asset divorce. Of course, when a divorce proceeding actually begins, it is not unusual for one spouse to challenge the validity of the prenuptial agreement. This is why it is essential to follow certain procedures when drafting the agreement initially.

Houston Court Rejects Wife's Challenge to Prenuptial Agreement

A recent decision from a Texas appeals court illustrates how to successfully defend a prenuptial agreement from such a challenge.

This case involves a couple that initially met through a dating website. The future husband lived in Houston, while the future wife lived in Vietnam. Even before the two met in person, the husband said he "wanted his future wife to sign a prenuptial agreement to protect his assets," according to court records.

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TX divorce lawyerAlthough prenuptial agreements are not something that business owners typically think about when they become romantically involved with another person, the reality is that making these types of considerations is extremely important for those who are considering marriage. Entering into this type of contract before a marriage takes place can give both parties peace of mind, while also ensuring that a company’s assets are protected in the event of divorce. For help drafting or enforcing your own prenuptial agreement, please contact an experienced high asset divorce attorney who can assist you.

Owning a Business Prior to Marriage

If a person owns a business going into a marriage, then those assets will most likely fall under the category of separate property in the event of divorce. However, any growth in value and earnings stemming from the business can and probably will be considered community property, which means that if a couple decides to divorce, the original business owner would need to split those earnings down the middle. Furthermore, if the spouse who didn’t originally own the business ended up substantially contributing to it during the marriage, then that business interest could be considered commingled with the couple’s community property and so converted into marital property for the purpose of division upon divorce.

A couple can forestall all of these complications by entering into a prenuptial agreement before getting married. For instance, the agreement could include provisions explaining that any increase in value or earnings from the business during the course of the marriage will still remain the original owner’s separate property in the event of divorce.

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Texas divorce lawyerMany couples choose to avoid entering into prenuptial agreements because they think it represents a lack of faith in the couple’s future. This failure to create a premarital agreement can have serious consequences if the marriage later dissolves. Fortunately, even after a couple is married, the parties can still enter into an agreement, in which they decide how certain assets will be divided in the event of a divorce. This type of document is known as a postmarital agreement and is an important tool for couples who have diverse or significant assets. However, there are certain requirements that must be met for postmarital agreements to be considered valid, so if you are thinking about drafting your own postmarital agreement, it is critical to retain and consult with an experienced high asset divorce attorney.

The Benefits of Postmarital Agreements

Drafting a postmarital agreement gives the parties involved the opportunity to assess their separate and marital property, including unique assets like antiques and jewelry, as well as debt, expenses, and spending habits. These agreements, like premarital agreements, allow the parties to not only identify assets but also to convert those assets from marital property to separate property or vice versa. Couples are also permitted to address the following topics:

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Texas divorce lawyerMany couples who enter into a marriage with significant assets of their own choosing to create a premarital agreement, which ensures that property acquired prior to the marriage will not be divided upon divorce. However, prenuptial agreements are only enforceable in court if they are created in accordance with specific standards, so if you or your future spouse have significant assets, it is critical to speak with an experienced high asset divorce attorney who can ensure that your agreement is valid and will not later be thrown out by the court.

Defenses to Enforcement

There are only a few ways that a person can defeat a premarital agreement, including by proving that:

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