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How a prenuptial agreement can protect assets

On Behalf of | Nov 25, 2019 | Divorce

Some couples in Illinois may be concerned about creating a prenuptial agreement. They might feel that they do not want to plan for the possibility of divorce, but a prenup can do more than simply protect the two individuals in the marriage. If one or both people have children from previous relationships, a prenup can help ensure that any assets brought into the marriage pass to those children if the parent dies.

Prenups can also help ensure that separate property brought into the marriage remains separate property. Usually, property that a person brings into the marriage is considered separate property. However, that designation can change if marital funds are mingled with the separate property. An example might be if one person owns a home at the time of the marriage. Using income earned during the marriage to pay the mortgage could mean that a portion of the home’s value is considered shared property.

A prenup could specify that any increase in a home’s value remains separate property even if marital funds are used for it. If one or both individuals expect an inheritance, it could be similarly safeguarded. A prenup could also be used to establish that neither person will seek alimony from the other.

Divorcing couples who do not have a prenup usually have to go through the process of property division, but this does not mean they have to go to litigation. It also does not mean they have no flexibility in how property is divided. For example, in Illinois, property is supposed to be divided equitably. A couple may decide that each person will take certain assets instead of splitting all the assets. This can be useful if one person is particularly attached to a certain asset or division is complicated, as is the case with some investments.

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