AT-A-GLANCE
3 Steps to Create a Prenuptial Agreement
Getting married in California and want to create a prenup? Follow these three steps to get started:
Step 1: Each party should hire a separate attorney who is licensed to practice law in California. This is important to ensure that the agreement is legally valid and enforceable.
Step 2: Both parties must disclose their finances, including all assets and debts. Full disclosure is crucial to make sure that both parties fully understand each other’s financial situation.
Step 3: Both parties should discuss and negotiate their financial future, including how they plan to manage their assets, income, and debts during the marriage and in the event of divorce. This step is important to make sure that the agreement reflects the needs and expectations of both parties.
For a more in-deth explanation, keep scrolling.
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How to Get a Prenup in California
Generally, you’ll have to take the following steps to get a prenup in California. However, these steps may vary somewhat from person to person, so we highly recommend working with an experienced attorney for your prenuptial agreement in California.
1. Decide if You Need a Prenup
First, you must decide if you need a prenup. Couples may want to protect their separate assets or businesses or clarify the inheritance rights of a child from a prior relationship. Prenups can deal with many financial issues. Ultimately, whether or not you need a prenuptial agreement is a personal decision you should make with the guidance of a legal professional.
Related: What Are the Pros and Cons of a Prenup?
2. Hire an Experienced Prenup Attorney
As discussed above, hiring an attorney is invaluable if you want a prenuptial agreement. An attorney can handle all of the ins and outs of making your prenup legal and enforceable. Like other states, California has specific requirements for the validity of prenuptial agreements. So, having the assistance of an experienced attorney may help you avoid potential legal pitfalls—such as drafting errors or omissions—making your prenup less susceptible to future disputes.
Related: Who Are the Best Prenup Lawyers in Los Angeles?
3. Fully Disclose Assets and Liabilities
A prenuptial agreement in California requires full financial disclosure for it to be enforceable. This means that both spouses must disclose their assets and liabilities. Start by compiling a comprehensive list. This should include real estate, bank accounts, investments, debts, and any other significant financial holdings. Both partners should be actively involved in this process, and nothing should be omitted or concealed.
4. Define Community and Separate Property
A prenup should clearly define separate property and community property. Generally, the law defines separate property as assets and property that a person owned before the marriage or acquired during the marriage by gift or inheritance. Community property is property acquired by either spouse during the marriage through joint effort or with marital funds. If the couple divorces, separate property remains the property of the owner. Community property, however, is subject to equal division between spouses.
In a prenup, however, the couple can specifically define separate and community property. This means they can decide which property goes with either spouse upon divorce.
Related: What Clauses Are Most Important to Include in My Prenup?
5. Agree on Spousal Support Issues
When drafting a prenuptial agreement, it’s important to address spousal support issues to provide clarity and certainty during a divorce. Couples can agree to a certain amount or period for spousal support payments. Couples may also decide to waive spousal support.
6. Determine How to Deal with Debts
A prenup should clearly state which party will be responsible for paying off debt. It should also include a provision for how the spouses will handle the debt in case of divorce or death.
7. Decide What to Do With the Marital Home
The prenup can define the marital home as either separate or community property. The agreement can also include provisions for the sale, transfer, or use of the home in case of divorce or death.
8. Define Ongoing Financial Responsibilities
The parties can establish their respective roles and responsibilities regarding day-to-day financial decisions. This can include provisions for who will manage the household finances, how expenses will be paid, and what types of expenditures will be considered joint or separate.
9. Determine Tax Filing
The couple can designate how they’ll file taxes in the prenup. The agreement can also establish how income and expenses will be handled and allocated, which can be particularly important if the couple file taxes jointly.
10. Decide Whether the Agreement Should End
Some couples believe their prenup should end after a certain amount of time and include a “sunset provision.” A sunset provision states that the agreement will expire or terminate on a certain date or after a certain event. Life circumstances, such as the birth of children, changes in career paths, or fluctuations in financial situations, may warrant modifications to a prenuptial agreement in California. Sunset provisions provide a mechanism for adapting to these changes.
11. Draft the Agreement
After you’ve settled on all of the major terms of the agreement, you or your attorney will draft the agreement. If you want your prenup to be legally binding, it must be in writing. Additionally, you should start the prenuptial agreement process well in advance of the wedding date. Rushing the process may lead to mistakes, which could impact the agreement’s validity.
Related: What’s an Example of a California Prenup Agreement?
12. Make Sure the Prenup Follows California Law
Below are a few legal requirements for a prenuptial agreement to be valid in California:
- Voluntary and freely entered by both parties;
- The parties must disclose all assets and liabilities;
- The agreement must not be fundamentally unfair;
- The agreement must be in writing and signed by both parties; and
- Both parties must have adequate time to review the agreement.
A prenup also must not have any provisions that are illegal or against public policy. For example, in California, you can’t include a provision that punishes someone for infidelity. An attorney can help you draft a prenup compliant with California’s detailed law.
Related: Understanding the Law: California Prenuptial Agreements
Hire Cyrus Pacific Law for Your Prenup
The many detailed steps involved in drafting a prenup can be complicated. You need an advocate who can listen to your specific concerns and draft a prenup to meet your goals. At Cyrus Pacific Law, we’ll work hard to help you create a prenup that meets your needs and is fair to your future spouse. Contact us today.