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How do prenuptial agreements work?

If you own property, have a lot of assets, or are a business owner, having a prenuptial agreement in place is a must. These agreements answer serious questions about the financial aspect of a marriage before the marriage even takes place, which makes them beneficial to people with large amounts of wealth. Forbes explains how prenups work so you can decide whether one is right for you.

Prenups offer specific protections

Spousal support can be afforded in some divorces. However, terms within a prenup can state that any instance of infidelity makes receiving spousal support impossible. A prenup also details who owns what properties, and how shared properties should be divided. In some situations, both parties can receive protection from a prenup, especially if both enter into the marriage with numerous assets.

Some things can't be covered

During a divorce, certain decisions are made by the state. For instance, if you seek spousal or child support, or want primary custody, it's up to the court in your jurisdiction to make those determinations. Adding language into a prenup stating these wishes is usually a waste of time, as the court's decision will override it. Also, if you own a piece of property or have assets in your name and don't disclose them when the prenup is being created, they won't be protected.

Negotiations are often tough

Even when they're in your best interest, bringing up the topic with your bride or groom-to-be is often difficult. When doing so, it's important that both parties are honest and upfront about their beliefs. It's better to have challenging financial discussions before the marriage takes place, as irreconcilable differences are sure to lead to divorce. Also, many people look at prenups as a guarantee that a marriage will end in divorce, or that the other party doesn't take the union seriously. No matter the objections, open communication about financial issues related to marriage can actually serve to fortify a couple's strengths.

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