A pre-nuptial agreement, or prenup, is an agreement entered into by a couple – preferably in good time before a marriage – which sets out how assets will be divided if they divorce or the marriage is dissolved. We hope they are never needed but they are there if the marriage ends.It can be used to ‘ring-fence’ any assets that one or both of them are bringing to the marriage, or that they may inherit during the marriage. Ideally, it’s quite a flexible document, dealing with how the impact of children, changes in employment or illness may affect the couple’s finances over the years, as we include provision for review.
Is it common for people to have pre-nups?
Since the landmark English case of Radmacher v Granatino in 2010, in which the court ruled for the first time that a prenup will be upheld unless one person can show why it shouldn’t be, prenups have become increasingly more common and popular.
We at AppyLaw have certainly noticed a rise in instructions, with many clients seeking to enter into them. Whilst not the most romantic of documents, it is sensible to think about what should happen if the marriage was to end – and this is often easier to do in happy times!What will my parents think?
The reality of the situation is that it’s often parents who are the driving force behind any prenup, as they are often anxious to ensure that any assets they pass on will be protected, especially if there is a family business or trust to protect. We are aware though that it is often a hard topic to raise!Sometimes we find it is the parents who are the ones who suggest these documents – this doesn’t mean they don’t like their future son-in-law or daughter-in-law and it certainly does not mean they think the marriage is doomed to fail.
When shall I raise it with my partner and how?
If you are the one asking for a prenup, you should ideally raise it with them as early as you can, to give them plenty of time to get used to the idea.Prenups have a greater chance of being binding if they’re signed at least 21 days before the wedding, so no one can allege they were forced to sign under duress. It’s definitely better not to leave it to the week before the wedding, when there will be plenty of other stressful things to deal with.Raising the issue of the prenup with your partner may not be as much of a big deal as it once were, particularly as they have become more common and more discussed within our culture. Given that the divorce rate is currently 42 per cent, most people can point to at least one couple who split in acrimonious circumstances and whose divorce took a real financial and emotional toll on them, which a pre-nup can help guard against.It also gives you the chance to make sure you’re both on the same page regarding your future together – you can talk through your plans for children, how you will care for them, and what would happen if either of you struggled with long-term unemployment or ill-health. It’s far better to test out how you both feel about these sorts of issues before you commit to each other, rather than afterwards, and to do so in happy times.
The prenup can act as an insurance policy you can file away and hope you will never need, but knowing that it’s there – just in case – could bring some comfort.What should you do if your partner asks you to sign a prenup?The first thing you should do is consult a solicitor and make sure you are being properly advised. Don’t be afraid to ask your solicitor to negotiate a fair deal for you.
The prenup preparation offers you a good opportunity to understand exactly where you stand financially and what you might be able to expect should you get divorced. Going through a divorce is such a stressful time and if you therefore have the financial certainty of knowing what the financial settlement will be, that must be a good thing during a really hard process
What do I do next?
Whether you, or someone you know is, considering asking a partner for a prenup, or have been asked to sign one, you should consult an experienced family lawyer and find out in detail the meaning and implications of a prenup for you. Please get in contact with the Family team.
Disclaimer: Anything posted in this blog is for general information only and is not intended to provide legal advice on any general or specific matter.