5 Things Everyone Should Know About Prenups

For many, prenups are part of the vocabulary of the rich and famous and often we may only be familiar with them from reading about celebrities. But here are five things that everybody should know about prenuptial agreements:

1. What is a prenup?

A prenup is an agreement between two parties soon to be married setting out what will happen with their finances if their marriage breaks down in the future. That agreement can account for circumstances in the future, which may or may not occur, and confirm the financial arrangements if certain scenarios exist at the time of the marital breakdown – e.g. if the parties have children, if one party sells their interest in a business or receives an anticipated inheritance etc.

2. I am not a celebrity, so I don’t need a prenup

Although it is understandable that celebrities, sports stars and individuals bringing in a substantially larger proportion of wealth to a marriage may seek to preserve their wealth and assets using prenups, the important issue to remember is that prenups are really more about creating certainty upon separation than anything else. Most people would welcome that certainty in the unfortunate event of a marital breakdown, irrespective of their level of fame or fortune.

The prenup will set out who retains what wealth and assets when a marriage comes to an end, removing the risk of dispute, court litigation and legal costs. This is particularly important for those individuals who don’t have the assets or funds to fight lengthy court proceedings. Therefore, it is perhaps even more important for those of more modest wealth to protect their assets with a prenup and remove the risk of litigation over pensions, the family home etc.

3. What would I include in my prenup?

There is no set formula for a prenup’s terms or content covering a prospective settlement in the event the marriage ends – each family is unique. Ordinarily, a prenup will set out the assets the parties are bringing to the marriage, including property, savings, shares etc and will account for assets already held jointly before the marriage too. Prenups routinely address how debts will be managed upon marital breakdown, so as to protect a party from becoming responsible for contributions to their former partner’s indebtedness, alongside addressing how inheritances and pensions will be dealt with too.

Prenups don’t cover everything however. They generally don’t address child arrangements or parenting style matters, they won’t address personal matters such as who or when to introduce children to a new partner, or which schools a child might attend. For these matters, it may be useful to consider creating a Parenting Plan.

4. I am getting married soon, when do I need to get a prenup?

The Court’s have indicated that it is important to recognise that the parties should be seen to be freely entering into a prenup and given sufficient time to reflect on its terms and obtain independent legal advice on its contents to ensure it is fair. Although there is no set timeframe to undertake this work, best practice suggests at least 4 months before a wedding otherwise you may not have time to complete the agreement. It is possible to complete a prenup in closer proximity to a wedding than this, but it important that this is addressed with your solicitor when instructing them.

5. I’m already married, is it too late to get a prenup?

Well, yes and no. You’re married so a pre-nuptial agreement cannot be made, but married spouses are still free to agree a post-nuptial agreement, which works in a similar way.

Irrespective of whether you are looking at a pre- or post- nuptial agreement it is vitally important to obtain independent legal advice about nuptial agreements and to understand how they can work for you.

Our team of family law specialists – in London, Milton Keynes, Bicester and Watford – can advise and guide you about pre-nuptial agreements. Get in touch – we’re here to help

This article is intended for the use of our clients and other interested parties. The information contained in it reflects the author’s view and is believed to be correct at the date of publication. However, it is necessarily of a brief and general nature and should not be relied upon as a substitute for specific professional legal advice.