Most people hire lawyers when they get divorced, but who consults an attorney before they get married? Money is one of the leading causes of conflict in marriages, but couples would be able to avoid some of this conflict if, before they got married, they had a better understanding of how Texas law regards property that belongs to married individuals or to their children. Strategizing with your fiancé about finances before you get married does not mean that you are planning to divorce or that you do not trust your partner; it just helps you be on the same page about making joint financial decisions and about the extent that you want to be financially independent of each other, your in-laws, or your stepchildren. It also covers what will happen should one spouse predecease the other. A Texas marital property agreement lawyer can help you understand your property rights as a spouse and make the financial decisions that work best for your family.
Texas Marital Property Laws
Texas law considers all money earned by a married person and all assets a married person buys to be the property of the couple; in legal terms, this is called community property. In other words, it does not matter which spouse earns what; everything belongs to the couple. All property owned by both spouses or purchased by either spouse during the marriage is presumed to be community property, and the party seeking to prove that it is separate property has the burden. Income earned off of separate property is considered community property and so, over time, the two categories mix. This can make it difficult and expensive to “trace” that property to prove what portion of an account is separate and what portion is community.
Another complication that can arise from misunderstanding how separate and community property work concerns the family home. If, for example, you have owned a house for 20 years and your wife moves in after you get married, the house remains separate property but your new spouse gains the ability to live in the house even after your death—yes, even if you leave the house to your children in your will or trust. If you rent out the house to tenants, and you and your wife buy a new house, the old house remains your separate property. However, the rent from the old property is community property. Likewise, property you inherit during your marriage remains separate property unless you convert a portion or all to community property, such as by depositing inherited money in a joint bank account.
For all of these reasons, Texas couples would do well to shield children from unforeseen future conflict by signing a prenuptial agreement.
Texas Prenuptial Agreement Laws
Couples have the right to keep some or all of their property separate, as long as both spouses agree. To do this, you can sign a premarital agreement, also known as a prenuptial agreement. Prenups are not just for celebrities; they are a useful way to avoid financial conflicts and, later down the road, probate disputes, if one or both spouses have children from previous marriages. It is important to note that prenups are only about money, not about children. Courts will not enforce a prenup that says that the couple will baptize their children in the Catholic Church, that the couple will pursue adoption if they do not have a child after spending X amount of money on fertility treatments, or that the children will spend Thanksgiving with Mom’s parents every year in the event of a divorce, for example.
Contact Hailey-Petty Law Firm, PLLC About Marital Property Agreements
The best way to avoid a costly divorce is to be honest with each other about your finances and financial values from the beginning. Contact Hailey-Petty Law Firm, PLLC in Austin and San Antonio, Texas to discuss your case.