Congratulations, you’re engaged! Wedding bliss is taking over and you’re getting wrapped up in the excitement of searching for a beautiful venue, shopping for the dream dress and getting the table plan just right.
Often, the overwhelming tasks that come with planning your perfect day mean that post-wedding practicalities can be overlooked, including how your finances will be split in the unforeseen event that the relationship breaks down.
If this is you, now could be the ideal time to consider a pre-nuptual agreement (pre-nup). Whilst it can be a difficult conversation to have, good communication now could strengthen your relationship in the long term, as both partners choose which assets will remain theirs.
Here is your guide to pre-nups and why they are important for your finances.
What are Pre-Nuptual Arrangements?
A prenup is a formally written document drafted after discussions with the couple. The agreement clarifies which assets one partner may want to retain in marriage. Assets could include (but are not limited to):
– Sole ownership of property
– Wealth and savings
– Business ownership
– Stocks and bonds
A misconception of pre-nups is that the agreements are just for the wealthier partner to hold onto their wealth, however, that is not necessarily the case. A person may choose to retain their inheritance but split their business ownership, through joint discussions and positive means of communication.
The essential element to a pre-nup is that it is drafted by a qualified family law solicitor, therefore, seeking legal advice before entering into such an agreement is integral.
Why is a pre-nup important?
Whilst we hope any difficulties wouldn’t end in divorce, if a relationship were to break down, a pre-nup is extremely helpful in mitigating disputes over how the finances will be divided making it a sensible and cost-effective option when planning for the future.
A couple, often those with significant wealth may seek assurance over what they own and what they will share. This is something that has to be planned ahead, because upon getting legally married all the assets are assumed to be owned as ‘matrimonial assets.’
Pre-ups not only protect wealth but can also shield a partner from significant debt with a debt clause, stating that there will be limited liability for a partner with debt entering into the marriage.
What’s more, a pre-nup can save time and money when going through divorce proceedings compared to gaining a financial order. Whilst the agreement in itself is not legally binding, it is highly persuasive and the court will often rely on what was agreed in the pre-nup to divide the assets.
Where will a pre-nup not be valid?
Be aware there are a few things which you cannot include in your pre-nup, such as, illegal activities, child custody arrangements or lifestyle matters.
The court will give pre-nups a ‘decisive weight’ in the unfortunate event of a divorce going to court. The judge won’t only look at what was agreed, but also the manner in which the agreement came about, for example, did a partner know about the other person’s wealth before signing.
To avoid a pre-nuptual agreement being invalidated later on remember to:
– Get legal advice to decide if a pre-nup is the correct option
– Ensure you fully understand what is required and enter willingly
– Think about any major events which could alter your finances including children or serious illness
– Leave plenty of time. Pre-nups signed less than 30 days before a wedding could later be invalidated.
How to get a Pre-nup?
If you’re engaged and have decided that a pre-nuptial agreement is the right option for you, you will need to seek advice from an experienced family law solicitor.
At Beyond Legal, we are experts in dealing with matrimonial disputes and pre-nuptual agreements, facilitating communication and navigating issues with advice and support.
Get a free consultation for family law services in Newton Abbot and Tiverton with Beyond Legal today.