Pre-marital agreements, also known as prenuptial agreements or ‘prenups,’ are legally binding contracts that outline how assets will be divided in the event of a divorce or separation. While prenups are not yet widely used in my own experience, they are becoming increasingly common as people seek to protect their assets and financial interests. There are both advantages and disadvantages to prenups, and plenty of stigma surrounding them. It is important for individuals to weigh the advantages and disadvantages of obtaining a pre-marital agreement carefully before deciding whether to enter into such an agreement.
Advantages of Prenuptial Agreements
- Asset protection: The most significant advantage of a prenup is that it can protect the assets that each spouse brings into the marriage. This can include property, savings, investments, and any other assets. In the event of a divorce, the prenup can ensure that each spouse retains their own property and assets rather than dividing them equally.
- Clarifying expectations: A prenup can also help to clarify the expectations of each spouse regarding finances and property during the marriage, helping to avoid misunderstandings and disputes down the line.
- Protecting family wealth: In some cases, individuals may have significant family wealth they wish to protect. A prenup can help ensure this wealth remains within the family rather than being distributed as part of a divorce settlement. It can provide protection to the person with the gifted familial wealth, as their family initially intended.
- Avoiding lengthy legal battles: A prenup can help to streamline the divorce process by providing a clear framework for the division of assets. This can help avoid lengthy legal battles and reduce the stress and emotional strain of divorce.
Disadvantages of Premarital Agreements
- Unromantic: One of the main disadvantages of a prenup is that it can be seen as unromantic due to the stigma surrounding them. Indeed, if one party wishes to have an agreement and the other party does not, this can cause arguments and lead to the receiving party feeling mistrusted. I would urge parties to re-examine this stigma. A prenup is no guarantee of a relationship breaking down, but if it does, you have the peace of mind of knowing you have already set a clear roadmap for how that will happen.
- Complexity: Prenups can be complex legal documents, and it is important to ensure that they are drafted correctly to ensure that they carry legal weight. Prenups drafted at home and without the benefit of legal advice are less likely to be considered by the Court as documents to apply substantial legal weighting to. This could lead to the prenup being cast aside altogether. Furthermore, you will each be required to disclose your financial position to the other party and the solicitor. You will each be required to get your own independent legal advice to satisfy the Court’s requirements for a properly drafted prenup.
- Limited flexibility: Once a prenup is in place, it can be challenging to modify or amend the agreement. This can be problematic if circumstances change during the marriage or if one spouse wishes to alter the agreement. A prenup drafted by a solicitor will include appropriate review clauses to ensure that the agreement can be kept up to date.
Prenuptial Agreement Solicitor
Prenuptial agreements can be valuable for individuals who wish to protect their assets and financial interests. However, they are not without their disadvantages, and it is important to carefully consider the pros and cons before entering into such an agreement. Ultimately, the decision to enter into a prenup should be based on the specific circumstances of each case and should be made after careful consideration and consultation with a qualified legal professional.
If you are unsure whether a prenup is right for you, Bridge McFarland offer a fixed fee initial appointments at the cost of £216 inclusive of VAT (pricing correct as of April 2023) wherein you can be offered advice as to whether a prenup is appropriate for you.