The topic of prenuptial agreements can spark a variety of conversations, many of which have a negative feel to them. Many people feel like they are being accused of being a “gold digger” if their partners discuss the prospect of creating a prenuptial agreement with them. Fortunately, residents of Texas can find creative ways to divorce-proof their assets.
Full disclosure
Many people believe that they can simply hide assets from their new spouses in order to protect those assets in the face of divorce. While that may sound like a good idea on the surface, most states require that all assets that you bring into the marriage be reported at the beginning of the prenuptial process.
Irrevocable trusts
We’ve established that any assets have to be reported for the prenuptial agreement to work, but what if you don’t own the assets in question? Instead of owning the assets, you can set up an irrevocable trust that benefits your children or other beneficiaries. Assets that are designated in these irrevocable trusts technically no longer belong to you and therefore do not have to be included in a prenuptial agreement.
What if you need those assets?
If you put assets into an irrevocable trust, you do not own them. However, the trustee can add you as a beneficiary, which would grant you access to the assets you listed in the irrevocable trust. In this sense, your assets have become “divorce proofed” without the use of a prenuptial agreement.
Pre- and post-marital agreements are legally binding contracts that should be reviewed by an attorney. Working with an attorney who is familiar with your state’s family law system can help you divorce proof your assets and ensure that you are protected should things not work out.