Today’s Alert: Navigating Pre and Post Marital Contracts

My Today’s Alerts series highlights ideas generated in my divorce financial advisory practice.

Your intended or new spouse asks you to sign his or her pre or post marital agreement.  You trust your new partner don’t you?  He or she has your interests at heart, after all. So, just sign it and move on.

But what will your future self tell you?  Your future self says THINK. That’s when people call me.

What are you  giving up or getting by having the agreement?  If your pre or post marital agreement asks one spouse to give up rights under your state’s family law provisions, both spouses needs to consider some type of compensation or concession in exchange for agreement.

For example, in Texas, a marital agreement may ask you to give up future income from the rental property your spouse owned before marriage.  Rental income is income that, without agreement, may be marital income.  By signing the marital agreement, you would be giving up the ‘right’ to that income.

You have several options that will help compensate you for this concession depending on your own financial situation.  You could limit the number of years that income is not part of marital income. You could request that any income from inherited property you receive will not be included in marital income. Lastly you could request outright payment, typically after several years of marriage or upon divorce.

Legal, financial and emotional factors as well as the martial property laws in your state influence decisions.  Be sure you have your own attorney and financial expert (and possibly a therapist) to help you sort through all the issues.

Silicon Hills Wealth and Divorce Planning of Austin work with clients and their attorneys to help insure that financial accounts are divided in the most efficient manner possible. Please contact Pam Friedman, CFP®, CDFA™ at

Silicon Hills Wealth Management and Divorce Planning of Austin do not provide legal advice.  Please consult with your attorney regarding your specific circumstances.