Graying Marriage and Divorce – Part 1: Marriage After 60, Prenuptial and Mid-Marital Agreements

By Deirdre R. Wheatley-Liss, LL.M, CELA

The decision of whether to marry is a deeply personal one no matter your age.

But, because most people over the age of 60 have accumulated wealth and are looking to preserve it – to pay for long-term care and/or pass it on to their heirs – it is especially important to consider the pros and cons of marriage. In this multi-part blog series, we share thoughts and tips for you to think about if you are considering marriage later in life.

Tip: From a legal and financial perspective, marriage may or may not be advantageous.

If you have children or other heirs to whom you want to give your assets as an inheritance, you want the process to be as smooth and uncomplicated as possible. To make it easier for those assets to pass from you to your children, if you plan to marry, I strongly recommend entering into a prenuptial agreement with the person you intend to marry.

Later in this series of blog posts, I will look at alternatives to marriage that, all things considered, may make more sense for some people and their specific situations.

Prenuptial Agreements

There are certain conditions that need to be met in order for a prenuptial agreement to be valid:

1. It has to be signed completely voluntarily and without any kind of coercion or duress.
   
   You cannot sign a prenuptial agreement just a few days before the wedding. A court may later say that if you sign a prenuptial agreement only days before you get married, it is inherently coercive. The reasoning goes something like this: the caterer has been booked, the band has been booked, the invitations have been sent out. So what are you going to do? Are you going to back out of the wedding or are you going to sign?
   
   You need to sign a prenuptial agreement well in advance – at least several months. By doing so, you may protect yourself from a court later invalidating it because the judge determines that one of the parties was coerced into signing it. 
   
   
2. Both parties must be represented by counsel – that is, each spouse has their own lawyer.
   
   If one of the parties is not represented by their own counsel, a judge could later come back and say that that spouse did not understand their rights and was coerced into signing the agreement (thus invalidating it).
   
   
3. There has to be a full and complete disclosure of all assets and liabilities that you are bringing into the marriage or that you want to keep as separate property. That requires creating a written inventory of the property belonging to each person together with statements of bank and investment accounts, tax returns, and lists of real estate and other property.
   
   
4. The recording of all assets – sometimes referred to as a balance sheet – has to be attached to the premarital agreement. 
   
   
5. Premarital agreements must be seen as fair at the time they are enforced.
   
   Pre-marital agreements are now determined to be enforceable at the time they are sought to be enforced.
   
   In considering whether a prenuptial agreement is enforceable, a court would assess the fairness of the agreement (including the possibility it was coerced) and whether the agreement would leave one spouse destitute (which is not allowed).

Example: In your prenuptial agreement, you have language that says that, in the event that you and your spouse divorce, your spouse gets 0,000, but in the event that your spouse is ill and seeking Medicaid, they get nothing. Since that would leave your spouse destitute, a judge would most likely rule the agreement unenforceable because it would be deemed unfair.

Mid-Marital Agreements

While mid-marital agreements – agreements similar to prenuptial agreements but created and signed after you and your spouse get married – are permitted in some states, they are not common in New Jersey because they are seen as inherently coercive.

While it is technically possible to craft a mid-marital agreement in New Jersey, you will want to consult experienced legal counsel for both parties in order to have such an agreement be enforceable.

In order to have an enforceable agreement, it is important that the agreement includes – at-the-present-time consideration – that is to say, some kind of money or property transfer in exchange for entering into the agreement. In order to make such an agreement fair in the eyes of a court, you need to demonstrate that the less favored party’s financial situation is made better by the agreement in some way. One way of doing that is to pay a consideration – so in exchange for signing the agreement, the less financially well-off individual gets some money or property now.

This post is for general informational purposes only. The specifics of your situation could affect the applicability of the information provided in this blog post. For a video presentation of this information, please visit Graying Marriage and Divorce, here. For more detailed information, please visit www.porzioplanning.com or contact us for a free 20 minute telephone consultation.