A prenuptial agreement may seem like a dampener for any couple entering into marriage. With divorce rates soaring each year, it may be a sensible option to protect your hard earned assets before things go wrong.
A ‘prenup’ is used to ensure you can end a marriage with everything you owned prior to the union. Dividing up the spoils of war before the battle has even begun may seem like a pessimistic option for some, so it’s worth considering the positive and negative aspects before you draft your agreement.
It’s not just the financial aspect, a prenup covers things of sentimental value like family heirlooms, gifts and even pets. It can cover things that an outsider would consider to have no financial value at all. As well as including the dispersal of assets in the case of divorce, a well drafted prenuptial agreement can include instructions about how a living spouse will be provided for, when one person in the partnership dies. It can also protect you from whatever past debt your partner could possibly bring into the relationship.
Prenups provide transparency and may improve trust, knowing where any boundaries lie before the marriage begins and preventing any confusion over available assets. In this way, it may reassure wealthy individuals that their partner is marrying them for love and not for any financial gain. This type of agreement also protects any loved ones from a previous relationship, children, parents or stepchildren, ensuring their welfare is considered. Having a prenup in place reduces friction about the division of a household once the marriage is over, since both parties have agreed to the terms and conditions
On the negative side, some may feel a prenup is unromantic and shows a lack of trust. It could be perceived as a show of pessimism about the union of two people before they have even walked down the aisle.
Are prenuptial agreements legal? In the UK, courts are actually under no obligation to enforce a prenup. It is normally adhered to in terms of premarital assets, and serves as a good starting point for a court to make any decisions about assets accrued during the marriage and how they should be dispersed.
Several landmark divorce cases have influenced the interpretation of a prenup, and the supreme court has created guidelines to assist in the process. The court has to ensure that there was no undue pressure or duress during the agreement. They have to confirm that the parties involved obtained independent legal advice, and check if there was full and frank disclosure of all financial assets before it was signed. Most importantly, what were the parties’ intentions when they agreed to the terms and conditions, and have the parties’ circumstances changed considerably since the marriage?
If you’d like to set up a prenuptial agreement, you must seek legal advice. Get in touch with a family law specialist for further details, some companies offer free consultations with guidance from a legally qualified professional.