In Florida, any property obtained during a marriage is fair game in a divorce. Family law judges usually split property equitably, which basically means fair. So, if it appears fair for the court to split your assets, like your retirement accounts, 50-50, they will do so. However, a prenuptial agreement may help in such circumstances.
Understanding a prenuptial agreement
A prenuptial agreement is a marital contract that couples create before they get married. It protects each spouse’s property and assets in the event of a divorce. You should note, however, that your prenup must be reasonable and not adversely affect the other spouse’s rights for it to be valid.
Why a prenuptial agreement is important for retirement accounts in Florida
For instance, if you have a Roth IRA account with $100,000 and your spouse has $50,000, you can agree that upon divorce, you each leave the marriage with your own accounts. The family law judge will uphold this agreement unless it’s unfair to your spouse.
A prenuptial agreement is also important for retirement accounts in Florida because it can help avoid heated arguments and stressful litigation down the road. If you and your spouse sign a prenuptial agreement before getting married, you’ll have already hashed out how to divide your property in the event of a divorce. This can save you time, money and emotional energy if you do end up getting divorced.
Factors to consider when creating a prenuptial agreement in Florida
First, you’ll need to disclose all of your assets and debts to your spouse. This is important because it will give your spouse a clear picture of what they’re agreeing to. The court could invalidate your agreement if your spouse can prove that they didn’t know what they were getting into when you approached them with this idea.
Also, you’ll need to decide how you want to divide your property. You can do this by taking into account each spouse’s financial situation, earning potential and contributions to the marriage.
Protecting your retirement accounts should be among your top priorities because you’ll need those funds when you might not be able to earn an income. In addition, depending on the size of your retirement accounts, they could be subject to taxes upon divorce. A prenuptial agreement can help you avoid these taxes and keep more of your hard-earned money.