I am not a big follower of pop culture. The last time I saw People Magazine in a doctor’s office, I did not recognize half of the celebrities. But one story that appeared in quite a few news outlets recently caught my eye, where the Canadian Prime Minister, Justin Trudeau, and his wife announced their separation. Of particular note – in every announcement, it was reported that “a statement from the prime minister's office said they both have signed a legal separation agreement.” This is one of the smartest things a couple can do to protect their personal and financial interests, should they move on to divorce. I might add, there are even smarter ideas. But more on that later.
A separation agreement serves as a written contract that outlines the rights and responsibilities of each spouse during martial separation. It often helps to clarify — and eliminate any misunderstandings relating to — important issues, such as alimony/spousal support, child support, child custody and living arrangements. These are the same issues that would be negotiated during divorce proceedings.
Separations can be temporary or permanent. Temporary, or trial, separations enable the couple to live apart as they consider reconciliation or divorce. The agreement may become permanent if the individuals remain separated without divorcing. If or when the parties decide to divorce, the date on the separation agreement becomes the date of valuation for marital assets. Importantly, debts and assets acquired by either party after the separation date are generally not considered marital property.
A separation agreement also specifies how couples will manage their affairs while living separately, such as who will live in the marital home, what are the schedules for child custody, and who pays spousal and child support. This type of agreement also typically divides property and debts. If the terms of a separation agreement work well, they can remain the same when the couple divorces.
However, some issues will need to be addressed outside the separation agreement. This includes how you will file income taxes. Separating couples may file as married, married filing separately, or as head of household if either individual meets certain criteria.
Another potentially contentious subject is deciding on a school district for the kids. If both parents live in school districts of similar quality, then the decision can be difficult. Many cases regarding the choice of school district end up becoming a fight for primary custody, because that usually decides the district.
So, while this decision on the part of the Trudeaus was a smart one, I will go one step further and say an even smarter step is a prenuptial or postnuptial agreement. Prenuptial agreements protect many of the financial elements within the relationship, including businesses, investments, real estate, future earnings, appreciation of both marital and separate property, potential matters related to alimony/spousal support and the rights of a spouse upon the death of the other party. A postnuptial agreement allows a couple who is already wed to outline their rights and responsibilities in the event of divorce or death of either spouse. Like prenuptial agreements, postnuptial agreements address many of the issues that arise during a divorce, such as asset and property division (including retirement accounts, trusts, pension plans, and any future gifts or inheritances), life insurance, alimony/spousal support, allocations of marital debt and tax responsibilities.
Pre and even post-nuptials will address these important items while the top of the cake is still in the freezer, harmony is in the air, and the idea of any of these provisions coming to fruition is an unlikely reality. But, in the likely event separation is imminent – you will be protected and ready.
If you are seeking a Bucks County attorney for a prenuptial, postnuptial or separation agreement or divorce proceedings, we can help. Contact the Bucks County divorce lawyers of Williams Family Law at 215-340-2207 or email info@bucksfamilylawyers.com.