Common Clauses in Prenuptial Agreements

Clauses Allowed in Prenuptial Agreements

The Texas Family Code imposes only two explicit restrictions on prenuptial agreements: they cannot impede a child's entitlement to support, nor can they violate any public policy or criminal law. A prenuptial agreement is a contract between two individuals intending to marry. Unlike most agreements, prenuptial agreements do not necessitate that the parties exchange anything of value (known as "consideration") for the contract to be valid. Instead, prenuptial agreements become enforceable once the parties marry, provided they are properly executed, which entails being in writing and signed by both parties.

According to the Code, prenuptial agreements may be employed to define property rights and obligations, decide how assets will be distributed in the event of divorce or the death of either party, and establish or modify spousal support obligations, among other uses. Prenuptial agreements may also be utilized to form a will or trust and specify ownership rights in life insurance benefits.

Common Clauses in a Prenuptial Agreement

Prenuptial agreements are highly customizable documents that can include any provisions that do not violate Texas law or public policy. While couples will tailor their prenuptial agreements to meet their individual needs, there are certain provisions that are commonly included.

One such provision is a clause defining separate property. Texas is a community property state, which means that property acquired during the marriage belongs to both parties and is subject to division in divorce proceedings. However, parties can use prenuptial agreements to define certain assets as separate property, regardless of when they are acquired or what contributions either spouse makes.

Another common clause is one that clarifies each party's debt obligations, and whether those obligations will remain separate or be subject to division in the event of a divorce. Additionally, prenuptial agreements often address spousal support, including whether either party will be entitled to support and, if so, for how long and in what amount.

Choice of Law Provision for Premarital Agreement

Finally, a choice-of-law provision is a common clauses in prenuptial agreements, as well. This specifies the state whose laws will govern interpretation and enforcement of the agreement. This provision is critical because it prevents parties from seeking a more favorable outcome by moving out of state. Parties may also use prenuptial agreements to define their respective responsibilities related to income, household expenses, savings, and investments.