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Prenups - Not Just for the Rich and Famous any more!

And every detail is being attended to.  But beginning a new life together is more than the perfect dress, reception or vows.  It's thinking about two separate people coming together in all aspects of their lives.  Anyone who has been married or involved in a long-term relationship knows that no relationship is totally harmonious.  One of the biggest stressors on a relationship is different values about spending and savings.  Jimmy Vaught talks about what a prenup can do besides prepare and protect you in the event of a divorce.  And our guest article is from Brad Wiewel, Board Certified in Estate Planning and Probate Law.  Brad talks about what a new couple needs to consider, besides thank you notes and honeymoon packing.  And most of these tips apply to those of you who are already married, too.

Jimmy Vaught

You don't have to be a celebrity or a movie star to consider a prenuptial agreement or "prenup". There are numerous reasons for a couple to consider a prenup.  Young adults can use a preup to shield themselves from a partner's debt accumulated before the marriage, such as credit cards, car loans and student loans.  They also can insure that family money stays in the family and can be passed down to the next generation.  A preup also encourages young adults to have an open and honest discussion of their finances which, quite frankly, receive less thought and conversation than the honeymoon destination.  More significantly, it encourages the couple to discuss their individual beliefs and values of money and debt.  Couples who marry or remarry in their later years or who have children should definitely consider a prenup.  A prenup can insure that children from a prior marriage or other family members receive an inheritance or family business instead of the entire estate going to the new spouse. It can also protect pensions and retirement benefits if the marriage does not last.  According to Brad Wiewel, a preup can be used as a financial planning tool, and a well drafted one can make the administration of an estate substantially easier and less expensive.  The role of prenups in a marriage later in life cannot be overstated.  His article appears below.

I have written in more detail regarding prenups in my blog, as well as other topics of interest.

Vaught Law Firm Blog

Brad Wiewel

Many people are under the impression that estate planning is just for people who are planning to die.  That's not the case at all.  Young couples who marry should prepare a will, a durable power of attorney, a medical power of attorney, and a medical directive at the very least.  These instruments will allow for either spouse to have the necessary tools in case the worst should occur.  In addition to these, each spouse should maintain an appropriate amount of life insurance for the other spouse.  Life insurance is usually very inexpensive at younger ages, and there are a variety of instruments that can also become part of a financial plan for the couple.   As children come along it's important to revisit the financial and estate plan on a regular basis.  It's never too early to think about financial goals and how to achieve them, as well as how to protect what's already have accumulated.  Since more and more couples are delaying marriage until after they have started their professional careers, there may be separate property or debt that has already accumulated prior to the marriage.  For second marriages there are even more reasons to have a financial and estate plan in place.  With blended families,there may be concerns that if something should happen to the biological parent of some of the children, those children would be financially secure, and not have a "Cinderella" situation.  When couples with adult children from prior marriages marry, there can be a certain amount of resentment towards the new spouse because they feel they may be cut out of their inheritance.  A prenup can pave the way for them to open up their hearts and minds to their parent's new spouse because their inheritance is protected. 

Brad Wiewel is a Board Certified in Estate Planning and Probate Law by the Texas Board of Legal Specialization.  He currently teaches in the University of Texas CFP^® training program, and has taught continuing education classes to CPAs at St. Edward's University. He also conducts education programs for financial service and insurance professionals.

His contact information is: 

The Wiewel Law Firm

1601 Rio Grande, Suite 550

Austin, Texas 78701

512-480-8828

www.texastrustlaw.com 

Vaught Law Firm, P.C.

3200 Steck Avenue, Suite 300

Austin, Texas 78757

512-342-9980

www.austindivorcelawyer.com