When it comes to protecting personal and financial interests in a relationship, legal agreements are a wise choice. While both prenuptial agreements and cohabitation agreements serve this purpose, they apply to different types of relationships and can cover different issues. Continue reading to understand the difference between the two.
Prenuptial Agreements: Protection for the Married Couple
A prenuptial agreement, also known as a prenup, is a legally binding contract created by a couple planning to get married. This agreement outlines the ownership of the couple’s assets and explains how those assets and debts will be divided if the marriage ends in divorce or death.
What It Covers: Prenuptial agreements can cover a variety of matters, including division of property, spousal support, division of debts, and even details about future children’s upbringing. It’s important to note, however, that child support and child custody issues are typically decided by courts based on the child’s best interests at the time of separation or divorce.
Limitations and Requirements: For a prenuptial agreement to be valid, it must be fair, both parties must fully disclose their assets and liabilities, and each party must have independent legal advice. It can’t be coerced, and both parties should have ample time to review the agreement before the wedding.
Cohabitation Agreements: Protection for the Unmarried Couple
Cohabitation agreements are designed for couples who live together but aren’t married. These agreements are becoming more common as the number of cohabiting couples continues to rise.
What It Covers: Like a prenuptial agreement, a cohabitation agreement can outline how assets and debts are divided if the relationship ends. It can also specify arrangements for shared living expenses, joint property, and even pet custody. If the couple later decides to marry, the cohabitation agreement can be converted into a prenuptial agreement.
Limitations and Requirements: As with prenuptial agreements, cohabitation agreements must be entered into willingly, with full financial disclosure, and it’s highly recommended that each party have their own lawyer. Unlike prenups, cohabitation agreements can’t address issues related to children unless the couple decides to marry.
Prenuptial vs. Cohabitation: Key Differences
While both agreements can provide legal protection and clarity, the choice between a prenuptial agreement and a cohabitation agreement boils down to the nature of your relationship and what you want to protect.
- Type of Relationship: If you’re planning to get married, a prenuptial agreement is the appropriate choice. If you’re living together without plans to marry, a cohabitation agreement can provide needed protections.
- Child-Related Clauses: In many jurisdictions, prenuptial agreements can include clauses related to children’s upbringing. Cohabitation agreements generally can’t include these provisions.
- Spousal Support: Prenuptial agreements can include provisions for spousal support in the event of a divorce. Cohabitation agreements typically don’t involve such provisions, although some areas do recognize support obligations between cohabiting partners.
Consulting with a family law attorney in Brampton can help clarify these needs and guide you in crafting an agreement that provides the best protection. Our experienced family lawyers at Sterling Law offer first free consultation (up to 30 minutes) and would be happy to provide you with legal advice about cohabitation and prenuptial agreements. Get in touch today.