If we were making a list of the subjects nobody likes talking about, prenuptial agreements and estate planning would likely be near the top. However, a prenuptial agreement can be a vital part of an overall estate plan, and is in fact a valuable tool that is underused in planning for life transitions. Even though a prenup might be the last thing on your mind as you plan to get married, understanding the impact of a prenuptial agreement on estate planning can help you to ensure that your loved ones are prepared for the future.
Why Consider A Prenuptial Agreement?
Although many couples are reluctant to talk about prenuptial agreements, they can clarify both parties’ wishes and provide reassurance that even if the unexpected happens, each person’s wishes will be respected and carried out. Prenuptial agreements aren’t just for divorce — they can provide important, legally enforceable direction in the event of the death or incapacity of a partner.
Before entering into a prenuptial agreement, both partners must fully disclose all assets and debts unless they specifically waive this requirement, meaning that a prenup can provide important clarity regarding each partner’s financial situation before marriage. A prenup also provides legally binding direction regarding which assets are to be considered separate and which are marital property, and can preserve assets for children from previous relationships or other family members in the event of divorce or death.
In addition to providing for distribution of assets, a prenup can also dictate the terms and amount of spousal support, distribution of life insurance, and assignment of debts in the event of separation or divorce. The agreement can also include a “choice of law” provision, in which the spouses agree which state’s law will apply if the agreement needs to be interpreted by a court later. Prenuptial agreements do, however, have their limits — they cannot address patrental allocation and parenting time issues, or child support, and they are largely unenforceable when it comes to non-financial matters, such as where the spouses will live or how they will conduct their personal affairs.
Prenuptial Agreements And Estate Planning
In Illinois, prenuptial agreements are governed by the Illinois Uniform Premarital Agreement Act (750 ILCS 10/1-10/11). To be enforceable, the prenup must be in writing and signed by both spouses. The agreement is not effective unless and until the parties are legally married. A prenup can be challenged after the fact if it was signed under duress, or if the required financial disclosures were not made or waived as required.
Prenuptial agreements can be a critical part of estate planning, and the terms of a prenuptial agreement will generally take precedence in the event that one of the parties dies intestate, that is, without a will. However, if the terms of a will or trust conflict with the terms of a prenup, a probate court may be charged with determining which document has priority. For this reason, it’s important to think of a prenup as a part of a comprehensive estate plan.
Especially in the case of blended families or second marriages, prenuptial agreements can be a critical part of estate planning. A prenup allows spouses to come to a contractual agreement regarding the distribution of real or personal property upon the death of a spouse, and the prenup can require that each spouse create other estate plan documents, such as a will, trust, or power of attorney, to carry out the terms of the prenup. In this way, a prenup can prevent surprises upon the death of a spouse — if both parties are on the same page when it comes to how property will be divided, challenges and confusion after a spouse’s death are less likely.
What Should I Consider When Integrating My Prenup Into My Estate Plan?
As with other estate planning documents, such as wills, trusts, or powers of attorney, the terms of a prenuptial agreement must be as clear and unambiguous as possible, as they may come into dispute at a time when you are not able to clarify your intentions. Understanding what can and cannot be included in each type of document, as well as how your estate planning documents can work together to carry out your wishes, is an important part of ensuring that your loved ones are cared for after your death.
If you are considering a prenup, or integrating an existing prenup into your estate plan, consulting with an estate planning professional, such as an attorney, is a crucial part of the process. A prenup is more likely to be enforceable if both parties to the agreement are represented by counsel at the time it is signed. In addition, a knowledgeable estate planning attorney can guide you through the process of drafting the other documents, such as wills and trusts, that will ensure your estate is distributed according to your wishes.
Interested in Getting Started With Estate Planning? We’re Here for You.
Preparing for the unknown can be difficult, especially if your estate is complicated. Whether you’re looking to get started with estate planning, update your current plan, or guide an estate through the complex Illinois probate process, our team of experienced and compassionate advocates is here to help.
At The Law Offices of J. Jeltes, LTD., we know what it takes to guide you through some of life’s most challenging family transitions. As you look to the future, we can help you understand what goes into the estate planning process, evaluate your assets, and prepare all necessary documents, including basic wills, trusts, powers of attorney, and advanced directives.
Our legal professionals are driven, attentive, and dedicated to achieving the best result possible. Every situation is unique and before hiring our firm, our attorneys will provide you with a comprehensive one-on-one consultation to discuss your legal concerns and goals.
Have any more questions? Ready to get started? Don’t hesitate to contact us whenever you’d like to begin the conversation.
