• How do you manage your finances?
• What are your levels of credit card debt or student loan debt?
• How are you going to use assets that are earned during marriage to pay down debt?
• If the party with higher income is helping to pay down loans for the other party, how will debt be managed in the event of a divorce?
Prenuptial discussions should also encompass a broader discussion of spending habits. Is one prospective spouse a spendthrift and the other a saver? If so, what does that mean when finances are merged together? Couples that have been together for years will likely have a better handle on this than younger couples, who may be fully disclosing their finances for the first time.
What About The Kids?
Though child support is not typically covered by prenuptial agreements, adoption by gay couples can factor into pre-marriage planning, especially when one partner is the biological parent or only one has gone through the adoption process. Advisors working with same-sex couples who have adopted or are considering adopting may need to discuss whether it makes sense for both parents to have formal parental rights and seek the help of an adoption attorney. Similarly, single parents who used surrogacy to have a child and then decide to get married should discuss the involvement of the partner in the parenting of the child.
If the dependent child is only going to be formally adopted by one parent, it is a good idea to outline that agreement in a prenup. Prenups can also play an important role in outlining the payment of education costs for dependent children. As with child support payments, courts can disregard child support agreements in prenups if they feel alternate arrangements are in the best interest of the child or if the financial circumstances of one or both parents have changed.
Alimony And Tax Law
One final area that advisors and couples who are considering prenups should be examining is the recent change in federal law regarding alimony taxation. Under the new law, alimony is no longer deductible by the payor, and it is no longer considered income to the payee. Those who have existing prenups with alimony provisions should be reviewing their agreements to verify that the payments still make sense financially. Likewise, those considering adding alimony provisions to a new prenup should keep the new tax law in mind.