Clear communication is one ingredient to a successful and happy relationship.
A prenuptial agreement is an excellent opportunity to frankly discuss issues in advance in your marriage such as expectations for employment, allocation of responsibilities for finances and retention of assets and debts throughout the relationship and if the relationship ends. These types of open discussions will assist in clarifying expectations throughout the relationship and may assist in allowing each of you to feel as protected and secure as the law permits.
No one expects to divorce but it is infinitely easier to express your expectations and agree on what is fair in the early days when things are going smoothly. Without a prenuptial agreement, you may be in the position of having to hash things out with your former partner at a time when bitterness, anger and sadness may be getting the better of you both. If your relationship does not work out, a “prenup” may also assist you in obtaining a happy divorce.
What is prenuptial agreement?
A prenuptial agreement is a legally binding contract created by two people before they get married. This type of legal agreement allows couples to settle upon terms as to how they wish to deal with assets, debts, and support obligations should they divorce in the future.
A prenuptial agreement is not just for wealthy people. Everyone deserves the protection that a good prenup provides. What’s more, these kinds of contracts are not just for legally married people.
Unmarried couples in BC who live together for more than two years become common law spouses and are subject to the same family laws, rights, and obligations as legally married spouses.
Consequently, if you are moving in with your partner, it is a good idea to ensure your income stream and assets are legally protected by signing a cohabitation agreement. A cohabitation agreement can address the same issues as a prenuptial agreement.
What does a prenuptial agreement cover?
Essentially, a “prenup” agreement or “cohab” agreement provides a way to protect your financial interests and set out obligations. These agreements are commonly used to keep your assets and debt separate and determine whether either of you should provide support to the other if you divorce. Keep in mind that the content of these kinds of agreements can vary widely depending on your assets and debts. Clauses can be customized according to your unique needs and goals.
A prenup agreement or cohab agreement can cover:
Property and asset division. o What assets and/or debts are each of you bringing into the relationship? What are the balances and values of these assets or debts? o The default rule in BC is that family property is everything you or your spouse own separately or together on the date you separate. When spouses separate, all family property will be divided 50/50 unless you have an agreement that divides things differently or a judge orders otherwise. BC courts can order unequal division of property or debt in certain cases. o Do you want the default rule to apply if you separate? If not, how will you divide real estate,bank accounts, registered accounts, Tax Free Savings accounts, pensions, and/or business assets? Will these assets be kept separate? You can include within the body of the agreement a process for determining how the assets will be valued and a formula for determining how each asset will be divided.
Inheritance and estate planning. o Will either of you have an estate claim against the other? o How will you treat any inheritances receivedduring the relationship?
Alimony (spousalsupport). o Will either of you be entitled to claim spousal support if the relationship ends?
Debt responsibility. o Will you keep your bank accounts separate or open joint bank accounts or a combination of both? o Will you have joint credit cards or lines of credit? Or will you keep your debts and liabilities separate?
Living expenses. o How will you and your partners are living expenses such as rent/mortgage payments, utilities and other household bills?
Care of children. o Who will be responsible for the care of children which either or both of you brought into the relationship? Will a non-biological parent be financially responsible for stepchildren if the relationship ends?
One important point to note in relation to children is that prenups and cohabs can not be used to prospectively decide questions of child guardianship, parenting time, and decision-making responsibility should your relationship end. Those types of decisions must be made at separation based on the best interests of the child.
How important is a prenuptial agreement in a divorce?
Prenuptial agreements and cohabitation agreements play a vital role. A properly drafted written agreement typically helps to minimize or eliminate conflicts that may arise throughout the relationship and which may arise in a separation or divorce. The bonus is that having a written agreement will usually greatlyassist in reducing expense and controversy at the time of separation.
With financial matters already resolved, the process of separation and divorce is much smoother. You and your partner have already decided what is fair and just in terms of property and debt division and spousal support so there should be next to nothing to argue about. If you and your spouse had
children, issues of parenting time, decision-making, and child support will be the only matters to be dealt with on separation. Child-centered issues tend to be resolved with much less animosity when there are no other conflicts or issues to address with your ex- spouse.
Looking for legal advice from a prenuptial agreement lawyer?
Safeguard your finances and possessions before taking the next step in your relationship. Valerie M. Little can help you by drafting a fair and comprehensive Prenuptial Agreement or Cohabitation Agreement. Valerie can advise you on how best to structure the agreement to protect your income and assets. Contact her family law firm today for a private consultation.
Her office is located in New Westminster, and she also serves clients from Vancouver, North Vancouver, West Vancouver, Burnaby, Port Moody, Coquitlam, Port Coquitlam, Maple Ridge, Pitt Meadows, Aldergrove, Abbotsford, Langley, Surrey, Chilliwack, White Rock, Richmond, Delta, Ladner and Whistler. Call Valerie M. Little Law Corporation today at 604-526-3333 for experienced, trustworthy and legal advice customized to your unique situation and needs.