Are you considering a Prenuptial Agreement before marriage but unsure if the positives out weigh the negatives? Natasha Miller explains further in this article around the pros and cons of Prenuptial Agreements and how Goughs are able to help you create a Prenuptial Agreement that is right for you.
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What is a Prenup?
A Prenuptial Agreement (a ‘prenup’) is a contract entered into by two parties before they get married, with the aim of setting out any property or assets owned by the parties and to outline how those will be divided in the event that they get divorced. Whilst a prenup can be advantageous, both parties need to understand the benefits and issues associated with such an agreement before entering such an agreement.
Prenuptial Agreement: Pros
There are many advantages to establishing a prenup for both parties before getting married. A prenup allows for specific property to be safeguarded, plans to be made for financial settlement in the event of divorce and expectations to be managed going into marriage.
Clarification and certainty on financial expectations
A prenuptial agreement is drafted to give each party a clearer understanding of their financial responsibilities and expectations. Having a prenup can offer a sense of certainty and predictability in the event of divorce.
Protection of assets and inheritance
In preparing a prenup, the parties can specifically set out arrangements for their existing property if they were to get divorced. Significant assets garnered before marriage or anticipated inheritances can be separated from joint marital assets. When a marriage ends, prenuptial agreements safeguard and outline how such assets are to be divided between the parties.
Delegation of financial responsibilities
A prenuptial agreement offers the chance to tailor the division of financial responsibilities to a specific couple. In the event of divorce, opposed to the standard rules in reaching a divorce settlement, a prenup provides couples with more flexibility. They can outline the division of their marriage’s financial aspects, such as debts, assets and financial support, to reflect their individual requirements.
Ease in the event of divorce
Entering into a prenup creates the opportunity to set out terms of the financial settlement should the marriage end in divorce. This prevents what can be a long, drawn out process of negotiation when the spouses decide to end the marriage and avoids the accompanying emotional tension. It also can reduce the legal costs associated with the negotiation process.
Financial openness before marriage
By discussing and arranging a prenup, an opportunity arises for healthy discussion surrounding finances, which can be carried forward going into the marriage itself. Drafting a prenuptial agreement manages the expectations of both parties and provides a grounding for transparency in the relationship. The marriage is then able to grow from a strong foundation of financial decision making.
Supports estate planning
Beyond planning for divorce, by establishing a prenup, both parties are able to make specific arrangements for their estate if they pass away during the marriage. Any children can be provided for and other end-of-life planning becomes a smoother process with a prenuptial agreement already in place.
Prenuptial Agreement: Cons
Putting in place a prenuptial agreement can be advantageous. However, it is also worth considering the potential drawbacks before creating and signing a prenup. These need to be appreciated and understood and can help you navigate the process with a clearer and more substantial comprehension.
Possible emotional strain and tension
A prenup can be a delicate subject. Couples may feel it is not the most romantic start to a marriage and prenups are sometimes seen as lack of trust. Navigating the process may put emotional strain on a relationship.
Not automatically legally binding
Prenuptial agreements are enforceable in the UK, especially if it remains beneficial to both parties. However, the court may put the prenup aside if it considers there are grounds for unfairness.
Drafting costs and intricacies
Prenuptial agreements are enforceable in the UK, especially if it remains beneficial to both parties. However, the court may put the prenup aside if it considers there are grounds for unfairness.
Agreement terms may become outdated
Life is constantly changing, but the terms of a can prenup remain the same. The agreement may need to be revised to reflect any significant developments, such as the presence of children, illness or an altered financial situation.
May not account for unforeseen future changes
Prenup agreements may be thorough when drafted, but they do not have the ability to see into the future. Unpredicted future situations are difficult for prenups to address.
Potential for pressure and coercion
Sometimes in a relationship where one party holds more power and wealth than the other. With this, there is a chance one could pressure the other into an agreement they are not entirely comfortable with. The prenup could then possibly be used as a source of control in the relationship.
How can Goughs help?
At Goughs, we can help you create a prenuptial agreement that is right for you. We are dedicated to making this process as smooth as possible, while ensuring you come out with a fair and balanced agreement. Our legal expertise is on hand to assist, so you can enjoy certainty and security in your next stage of life.
Alternatively, if you are already married, we would be happy to aid you in creating a postnuptial or marital agreement. If you wish for further information on these areas, please contact our family team.