WATCH: What is a premarital agreement? Is it the same thing as a prenuptial agreement?

Melissa J. Avery answers:

Premarital agreements, also known as prenuptial agreements, are agreements entered into in anticipation of marriage. These agreements designate how property will pass upon the death of one of the parties or upon the dissolution of the marriage. Typically parties enter into such an agreement because they want their property to pass or be divided in a way that is contrary to how it would pass or be divided according to state statute.

Provisions regarding the custody and support of children are generally not included in these agreements as they have been found to be unenforceable. Premarital agreements can be a valuable tool for parties wanting to protect assets earned prior to the marriage for themselves or their children. To be successful the parties should start the process of drafting their agreement well in advance of the wedding date and be willing to fully disclose their financial positions at the time the contract will be signed.