A prenup – or prenuptial agreement – is a document that outlines how you and your spouse should divide assets such as cash and property in the case of a divorce. While it might not be pleasant to think ahead to rockier times, a prenup is a great way to give you peace of mind, particularly if there’s a big discrepancy between your earnings or assets.
Who is a prenup for?
Anyone who wants to protect themselves in case of a divorce should consider getting a prenup. If you have significant savings and investment, or a business that you would like to safeguard, then a prenup could be essential. It is also helpful for the less financially secure partner, as you can outline protections for their future.
Prenups can also be helpful for couples where one partner has substantial debt. It can be written into the agreement that your spouse will not become liable for your debt in the case of a divorce. Concerns about debt can sometimes make people cautious about getting married, so this is a good way to ease the concern.
How does it work?
A prenup is a formal written agreement, not legally binding but typically given a lot of weight during divorce proceedings. It should list the couple’s individual and shared assets, with instructions for how they should be divided if a divorce were to happen.
You can also put down information about future financial support for your children, if applicable. This information will be considered carefully by the court, but only followers if it is in the interest of the child.
The clear benefit of the prenup is the fact that it allows you to negotiate these things while you have clear heads and each other’s best interests at heart. If a divorce turns bitter, questions around the division of assets can quickly get messy. A prenup is probably going to be less important if both partners are of similar financial means, or if your income and assess are relatively small.
What are the next steps?
First, you’ll need to discuss it with your partner and make sure you’re on the same page. Getting a prenup isn’t exactly romantic, but it doesn’t have to be an awkward conversation either. Just be open about what a prenup is, why you want it and the benefits to both of you.
Once you’ve agreed, you should both seek legal advice. Typically, this needs to be from different lawyers to avoid any conflict of interest. A lawyer will help you to ensure that the agreement is fair and that you don’t overlook any key elements. Between you, your partner and your legal representation you can confirm what the division of assets should be.
Finally, the prenup will need to be written up and signed, and there should be a lawyer present for this. When taking legal advice, you can also ask questions about the process for finalising your agreement.
Can I get a prenup if I’m already married?
Prenups are designed to be written before the wedding – however if you say your vows and then realised that you’ve overlooked this important piece of housekeeping, there are still options. A postnuptial agreement (postnup) is a document that provides the same assurances as a prenup, however it’s written after the wedding. If you think that this might be right for you then get advice from your legal representation.