Prenuptial Agreements And Estate Planning, Part 1
Prenuptial agreements are contracts entered into by spouses prior to marriage to manage their property rights and spousal support obligations. Such premarital contracts are formed because of a singular or communal desire to establish each person’s economic rights and obligations in the situations where one spouse predeceases the other or the marriage simply ends. Parties primarily hope to provide clarity and avoid conflict over any division of marital assets should the marriage dissolve. Entering a marriage with a prenuptial agreement may make dividing your estate less complicated and ensure that it will be distributed in accordance with your wishes.
In most states, including Florida, a spouse is automatically entitled to an elective share of his or her spouse’s estate, which in Florida is 30% of the other spouse’s assets. There are times when one spouse wishes to provide for the other spouse in other ways and limit his or her share of the estate.
A prenuptial agreement that incorporates estate planning is a method of limiting a spouse’s share of an estate. Because most spouses utilize prenuptial agreements to retain property and assets accumulated before the most recent marriage, a great majority of prenuptial agreements address the preservation and protection of separate property. Other common issues covered in prenups are “property division” and “inheritance rights.” A prenup may protect these assets from becoming commingled with the assets and property accumulated during the marriage that would be divided as part of a decedent spouse’s marital estate.
Without a prenuptial agreement or trust, a surviving spouse in Florida has the right to claim an elective share of an amount equal to 30% of the elective estate. (Fla.Stat. §732.2065) A prenuptial contract waives any claim to this amount of the spouse’s estate, usually in exchange for other considerations which may name the surviving spouse as a beneficiary to a life-insurance policy or trust. In the second part of this article, we’ll examine some of the important considerations in using a prenuptial agreement as an estate planning tool.
The Men’s Divorce Law Firm can offer assistance in drafting a prenuptial agreement that meets all of your needs, while offering financial protection. Call 321-DIVORCE today to schedule a consultation and follow our Twitter page for more insights about divorce and family law.