Regardless of a person’s age or financial status, it is reasonable to create a prenuptial agreement. Even if a couple decides not to create one, it may be best for them to sit down prior to the wedding and discuss their current financial situation and their future financial goals. For instance, a couple should disclose all debts, assets and other liabilities in full. Bank and credit card statements need to be shared to ensure honesty during the discussion.
Although it doesn’t matter who handles the money or who pays the bills, it does matter that each party is responsible for their own finances. If one party has poor credit due to a bankruptcy or previous divorce, there should be a money management plan that takes this into account. Once a money conversation has taken place, both sides should agree on financial fidelity for the rest of the marriage.
Financial fidelity means that neither person will engage in secret borrowing or make a large purchase without coming to an agreement with or even informing the other person. Staying true to this arrangement is a good show of faith that an individual will make decisions that will benefit the entire family and look out for the unit’s best interest. It also shows that each person is willing to work as a team moving forward.
During a divorce, a prenup could settle property division issues between the two parties. It may determine who gets a certain asset or who gets the cash value of that item if it is liquidated. Attorneys for both parties might be able to help review such a document to ensure that it conforms with state laws. If it does not, it could be possible to challenge it in court and have some or all of it ruled invalid.