Donna and David Are Considering Marriage

question 54

Essay

Donna and David are considering marriage. It is the second marriage for both and each has children and substantial property from the previous marriage. They would like to enter into an agreement that would control the ownership and division of their property in the event of divorce. What is this agreement called, and what would normally be covered in the agreement?

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Definitions:

Future Value

The worth of a current asset or amount of money at a specified time in the future, accounting for specific interest or growth rates.

Future Value Table

A mathematical table used to calculate the future value of an investment or loan based on a specific interest rate and time period.

Present Value Table

A table used to calculate the present value of a future amount of money or stream of cash flows given a specific discount rate.

Present Value of $1

The current worth of a single dollar to be received in the future, discounted at a specific interest rate.