Do I Need a Prenup?

Whether you need a pre-nuptial or pre-marital agreement (sometimes also referred to as a prenup) will depend on your individual circumstance. Many people believe prenups are only needed for the rich and famous but that is not the case.

Whilst couples getting ready to marry do not really want to consider the end of their marriage, almost half of all marriages end in divorce (even though divorce rates have fallen in recent years) and prenups can save a lot of time and money in the long run.

Our team of family law and divorce lawyers in Milton Keynes can advise and guide you through the entire pre-nuptial agreement process. In the meantime, the following article provides useful information about prenups and what they involve.

A prenup is an agreement entered into by two parties prior to marriage, setting out the ownership of their belongings (money, assets and property) and debts and the financial provision they want to make for each other in the event of a divorce. The agreement can also account for things that may or may not occur in the future, for example children, the sale of one parties’ interest in a business or inheritance.

Many celebrities bringing a substantially larger proportion of wealth to a marriage may seek to preserve their wealth and assets using a prenup. A prenup will set out the intention as to who is to retain what wealth and assets if the marriage comes to an end. This helps remove some of the risks of dispute, court litigation and legal costs. It is therefore perhaps even more important for individuals of more modest wealth to remove the risk of litigation over pensions and the family home for example, as they may not have the assets or funds to fight lengthy court proceedings.

Money issues are at the forefront of many divorces, so having these types of conversations before the wedding can really help build the foundation for a stronger union and minimise the potential for conflict around finances during the marriage. If the marriage does still end in divorce, having a prenup will help save time and money in the divorce settlement.

It is important to note that in England and Wales, prenups are not legally binding. It is critical to consider the conditions in which the prenup is created and when. The courts do typically recognise and uphold prenuptial agreements, as long as they meet the qualifying criteria and are fair in all the circumstances. The prenup must be entered into willingly by both parties, who should have both received legal advice and received full financial disclosure from each other. Both parties will also need to sign the prenup. Furthermore, the courts have advised that the parties need to be given sufficient time to reflect on the terms of the agreement. Although there is no timeframe set, it is best practice not to sign an agreement within 28 days immediately before the marriage or civil partnership.

Every prenup will be unique to that family. There is no set formula for the terms or content. A prenup will usually set out the assets the parties are bringing to the marriage, including property, savings, shares etc and will account for assets (including business 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.

The family legal system in England and Wales is extremely discretionary. Without a prenup, the courts starting point will be to consider what was built up during the marriage to be divided equally on divorce. There is no discrimination between the ‘breadwinner’ and ‘homemaker’. However, the court takes into account all the circumstances and in particular has regard to what the parties’ needs are, which may mean there should be a departure from an equal division.

Prenups are not for every couple (and not every divorce lawyer has one) but if you are looking to protect wealth you may have or might inherit or build up during the marriage, they are a useful tool in guiding the courts on a divorce. Although not automatically binding, as stated above, if drafted correctly and they are fair, they are likely to be upheld and will thus achieve certainty in what is a highly discretionary legal system.

The short answer is yes. However, 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.

Ready to take the next step? As leading divorce solicitors in Milton Keynes, our team of family law specialists can advise you about your prenup. As well as our head office in Milton Keynes, we also have offices in Bicester, Watford, and London where we can arrange appointments to see you in person. Talk to us in confidence and find out where you stand. 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.