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Prenuptial Agreements: A Comprehensive Guide for All Couples

Learn everything you need to know about prenuptial agreements, how they protect your assets, and why they're valuable for couples with children, young couples, blended families, and those with significant assets.

Introduction

A prenuptial agreement (commonly called a 'prenup') is a legal contract created by two people before they marry that typically outlines how assets and debts will be divided in the event of divorce or death. While often associated with wealthy individuals protecting their fortunes, prenups serve many practical purposes for couples across various life situations. This document can help clarify financial rights and responsibilities, protect family businesses, shield one spouse from the other's debts, and establish clear guidelines for property division. Whether you're entering marriage with children from previous relationships, significant assets, or simply want clarity about your financial future together, understanding prenuptial agreements is an important step in building a secure foundation for your marriage.

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Key Things to Know

  1. 1

    Prenuptial agreements must be executed well before the wedding (at least 30 days is recommended) to avoid claims of coercion or duress.

  2. 2

    Both parties must provide complete and honest financial disclosure for the agreement to be valid.

  3. 3

    Each person should have their own independent legal counsel review the agreement before signing.

  4. 4

    Prenups cannot determine child custody or child support amounts, as these must be decided based on the best interests of the child at the time of divorce.

  5. 5

    The agreement should be reviewed and potentially updated after major life events such as the birth of children, significant inheritance, or substantial changes in financial circumstances.

  6. 6

    State laws vary regarding prenuptial agreements, so it's essential to work with an attorney familiar with the laws in your jurisdiction.

  7. 7

    A well-crafted prenup promotes financial transparency and communication, which can strengthen your relationship rather than undermine it.

  8. 8

    For blended families, a prenuptial agreement should work in conjunction with your estate plan to ensure children from previous relationships are protected.

Key decisions before you file

Before you file a Prenuptial Agreement in Delaware, a few decisions shape the document: which option to choose and what each one means. The Prenuptial Agreement guide walks through them.

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Delaware Requirements for Prenuptial Agreement

  • Disclosure of Assets and Liabilities (13 Del. C. § 326)

    Full and fair disclosure of all assets, liabilities, and income of both parties is required. Failure to disclose may render the agreement unenforceable under Delaware law.

  • Voluntary Execution (13 Del. C. § 326)

    The agreement must be entered into voluntarily, without duress, fraud, or undue influence. Both parties must have reasonable time to review the agreement before signing.

  • Independent Legal Counsel (13 Del. C. § 326)

    Each party should have the opportunity to consult with independent legal counsel before signing the agreement. While not strictly required in Delaware, this significantly strengthens enforceability.

  • Unconscionability Provision (13 Del. C. § 326)

    The agreement must not be unconscionable when executed or when enforcement is sought. Delaware courts may refuse to enforce provisions deemed grossly unfair.

  • Alimony and Support Waiver Limitations (13 Del. C. § 326)

    While parties may waive or modify spousal support rights, such provisions may be unenforceable if they would cause a party to become eligible for public assistance at the time of divorce.

  • Child Support Restrictions (13 Del. C. § 501)

    Provisions attempting to waive or restrict child support obligations are unenforceable under Delaware law, as child support is the right of the child, not the parents.

  • Child Custody Limitations (13 Del. C. § 722)

    Provisions regarding child custody and visitation in prenuptial agreements are generally not binding on Delaware courts, which will make determinations based on the best interests of the child at the time of divorce.

  • Separate Property Designation (13 Del. C. § 1513)

    Clear identification of property that will remain separate during marriage and in the event of divorce, including assets acquired before marriage and those received by gift or inheritance.

  • Marital Property Division (13 Del. C. § 1513)

    Specification of how property acquired during marriage will be classified and divided upon divorce, potentially deviating from Delaware's equitable distribution principles.

  • Debt Allocation (13 Del. C. § 1513)

    Provisions for allocation of debts and liabilities in the event of divorce, including pre-marital debts and those incurred during marriage.

  • Estate Rights Waiver (12 Del. C. § 901)

    Waiver of rights to elective share, intestate succession, and other statutory rights that would otherwise apply upon death of a spouse under Delaware law.

  • Sunset Provision Compliance (6 Del. C. § 2-101)

    If including a sunset clause (where the agreement expires after a certain period), ensure it complies with Delaware contract law principles and clearly states the terms of expiration.

  • Choice of Law Provision (6 Del. C. § 2708)

    Specification of which state's laws will govern the agreement, particularly important if the couple may relocate from Delaware in the future.

  • Amendment and Revocation Requirements (6 Del. C. § 2-209)

    Clear procedures for how the agreement may be modified or revoked, requiring written consent of both parties in accordance with Delaware contract law.

  • Federal Tax Considerations (26 U.S.C. § 1041)

    Acknowledgment of federal tax implications of property transfers pursuant to the agreement, including potential gift tax consequences and basis adjustments.

  • ERISA Compliance for Retirement Assets (29 U.S.C. § 1055)

    Special provisions for waiver of rights to retirement benefits governed by ERISA, requiring specific language and potentially a post-marriage spousal consent for qualified plans.

  • Uniform Premarital Agreement Act Compliance (13 Del. C. § 321-328)

    While Delaware has not adopted the UPAA, awareness of its principles can strengthen the agreement, especially if the couple may relocate to a UPAA state.

  • Financial Support During Marriage (13 Del. C. § 502)

    Provisions regarding financial responsibilities and support obligations during the marriage, which must not violate Delaware's public policy on spousal duties.

  • Execution Formalities (13 Del. C. § 326)

    The agreement must be in writing and signed by both parties. While notarization is not explicitly required by Delaware law, it is strongly recommended for evidentiary purposes.

  • Severability Clause (6 Del. C. § 2-302)

    Provision stating that if any portion of the agreement is found unenforceable, the remainder of the agreement will still be valid and binding under Delaware contract principles.

Frequently Asked Questions

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