So, what’s mainly covered in a prenuptial agreement, anyway? One of the most important parts of a prenup is distinguishing between what is separate property and what is marital, or joint property. What’s the difference?
Separate property is property that one party owns 100% of, should the parties choose to separate or divorce. Property that is classified this way is not subject to equitable distribution, or splitting in any way during divorce proceedings.
Marital property is property that is subject to equitable distribution should the parties split up. Often, equitable distribution means that the particular property, or its value, is split 50-50, though not always. For example, say two parties purchased a home together once they were married. One party’s father gave his child $100,000 toward the down payment of the house. That party would usually be entitled to the $100,000 deposit that the father put down before the property is split.
The power of a prenup is that the parties get to identify for themselves what counts as separate property, and what counts as marital property. Some parties say that literally every single piece of property should be classified as separate property, and thus in a divorce, nothing would be split. Other parties carve out a few, or many items that should be classified as marital property. Consider wedding presents. Income. Property and/or accounts purchased jointly, or with both parties’ names on it. Gifts from one to the other. Be as specific as possible, and have a conversation or two about this subject with your partner, to get a better sense of what they would like.