Tag Archives: prenuptial agreement

IL divorce lawyerWhile many couples think they know just about everything regarding the other party before they get married, there are often some big surprises that get revealed after a bride and groom say their vows. Everyone has bizarre, and typically harmless, habits that they either keep under wrap early in a relationship or unconsciously avoid doing around others. However, some individuals have more damaging habits, addictions, and ways of living than is good for them, or their spouse. One of these is compulsive spending. Compulsive spending and the financial strain that it causes on a relationship can ruin a marriage. A family law attorney may provide an option for you before it comes to this, however.

What Is Compulsive Buying?

It is reported that six percent of the U.S. population has compulsive buying behavior, which is not a diagnosable disorder but certainly derives from a serious behavioral issue. Compulsive buying or spending is more common in women — 80 percent of people with compulsive buying are women — though with online shopping it is expected to increase in the male population as well. Compulsive buying is characterized by an obsession that compels the individual to continue a repetition of behavior (buying unnecessary things) even though there are obvious adverse consequences, such as not being able to afford necessities, credit card debt, going into bankruptcy, and getting divorced.

How a Postnuptial Can Help

According to a number of surveys, financial fighting between spouses is the leading or secondary contributor factor in divorce, with 41 percent of Generation X spouses reporting that they got divorced because of disagreements about money. Nearly half of married and cohabiting couples argue about money, with the majority of the arguments involving a spouse saying that the other spends too much, or a spouse that says that the other is too stingy. Other fights are common, such as whose responsibility it is to pay the bills or what the couple’s financial goals are. A postnuptial agreement can help resolve these conflicts by cutting money disagreements out of the marriage altogether.

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IL divorce lawyerPrenuptial agreements can be used for a variety of marital reasons, and one of those reasons is for debt protection. The average American has more than $38,000 of debt, and this does not even take into account home mortgages. Millions of Americans are so deep underwater on their mortgages and other loan payments that they are will likely end up being in debt until the day that they die.

Surprisingly, Americans are taking on more debt each and every year, despite knowing the consequences. Credit card debt is now tied with home mortgage debt, followed by student loans and car loans. The later comes as little surprise when the average new car price tag comes in at more than $37,000. The last thing that you want to do when you marry the love of your life is to begin worrying about your spouse’s high debt and financial troubles. After all, financial turmoil is one of the most common stress points in marriage.

Will a Prenuptial Agreement Protect Me from My Spouse’s Debt?

Debt acquired before marriage is not the legal burden of the other spouse. If your soon-to-be-spouse has a $40,000 in student loans, you will not suddenly be responsible for that debt when you marry. Similarly, if your spouse fails to make timely payments on that debt, your credit score will not suffer as a result. However, if you are a co-signer with your spouse onto a credit card or other type of loan, you will be held financially responsible for that debt, even if you end up not doing any of the spending.

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IL divorce lawyerPrenuptial agreements have been around for a long time. They are used to separate each party’s finances so that not everything gets lumped into marital assets during the duration of the marriage. For example, a prenuptial agreement could have a clause that all of the high earning spouse’s salary during the marriage be considered non-marital assets. Prenuptial agreements are also used to protect one spouse from the other’s horrible debt, as well as many other financial reasons. Lifestyle clauses within pre- and postnuptial agreements are entirely different.

What Is a Lifestyle Clause?

A lifestyle clause is a pre or postnuptial agreement between spouses about the behavior of one or both during the marriage, typically relating to in-laws, religion, and other joint decisions such as child raising. Some spouses are putting in lifestyle clauses within their pre- and postnuptials that limits the other spouse’s weight, limits time spent with in-laws, or limits the number of days that in-laws can stay in the couple’s home. Other lifestyle clauses are used to deter infidelity, set up rules regarding a child’s religious upbringing or education, or who gets the family pet if it comes to divorce. None of these lifestyle clauses discuss money, aside from the financial penalties that breaking the rules may incur.

Financial Penalties Are Commonly Used to Hold Both Spouses Accountable

The predominant way that lifestyle clauses are used to hold each spouse accountable, at least for wealthy married couples, is with the use of financial penalties. For example, if a husband gained 10 pounds, the prenuptial agreement may require him to pay his wife $1,000 for each pound gained, coming to $10,000. Infidelity could be fined at $500,000, as some reported clauses mandate.

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IL divorce lawyerThere is a common misconception that prenuptial agreements only benefit the wealthy. News stories of high profile divorce cases openly discussing existing prenuptial agreements only serve to perpetuate and reinforce this error. While affluent Americans do experience substantial benefits, having the protection of a prenuptial agreement is arguably more valuable to the working class citizens.

Although it is not the most romantic idea, if you have an upcoming marriage, you will want to consider creating a prenuptial agreement, and here is why:

Marriage Is a Legal Agreement

Although the thought of marriage being a legal agreement is a sobering realization, those who understand and appreciate this reality fare better in the unfortunate event of divorce. Before the wedding begins, everyone is confident love that will never end; yet, the United States has a notorious divorce rate of nearly half of all unions. In Illinois, once you are married, everything is owned jointly, from the money you make in your business to the house you buy and everything in between. During a divorce, everything is subject to an equitable marriage division, or as close to 50/50 as possible, unless you have a prenuptial agreement stating otherwise. For some, losing half of their assets is financially devastating.

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IL divorce lawyerPlanning a wedding is an intensely exciting time, during which every little detail brings you one step closer to saying “I do.” However, somewhere between the color scheme and the wedding march, it is important to remember that a marriage is the joining of two lives in their entirety. Not only will you be sharing a family and a home, but you will also be sharing in each others’ financial status, for better or for worse.

Although as we discussed in another blog that the divorce rate is dramatically decreasing, it is still the sobering reality of a significant portion of the population. Therefore, it is vital to protect yourself, and your dependents, from any financial fallout that may occur after a divorce. If the wedding has not happened, you still have time to complete a prenuptial agreement. If, however, you are already solidly into the marriage and the honeymoon phase is long-past, do not fret; a postnuptial agreement is available.

The Basics

Both a prenuptial agreement and postnuptial agreements are legal documents that specify what happens, should the marriage come to an end. The sole difference between the two is, the prenuptial is signed before the wedding begins, while postnuptial begins after entering into the union. The primary focus of either agreement is the financial outcome, such as the division of property and debt, but since the spouses create these arrangements with the assistance of a skilled attorney, they can include or exclude anything a party wishes to be made clear. Some spouses even go so far as to explain the outcome, should there be infidelity during the marriage. Most couples include information regarding:

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