Protecting Your Inheritance with a Prenup

Your inheritance may be a relatively modest financial gift you expect to receive. Or it may represent generations of substantial family wealth. Either way, when you are thinking of getting married, you should consider what happens to your inheritance if the relationship later ends in divorce. In this article, we explain how protecting your inheritance with a prenup can help safeguard an inheritance or family wealth.

A prenup is an agreement entered into by a couple before 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 person’s interest in a business, or an inheritance.

For a prenup to be upheld by the Court on divorce, it must meet certain criteria, such as being fair, entered freely by both parties within good time of the wedding and with the benefit of financial disclosure. While prenuptial agreements are not necessarily binding on the Courts, the expectation is that they will be upheld if these conditions are met.

During the financial settlement aspect of a divorce, the court has the discretion to consider all assets when deciding what is fair. This can include inherited property or money. This is where a prenup can make clear that it has been agreed that an inheritance should remain outside the marital pot. This can include an inheritance that has already been received, or one that is expected in the future. It therefore provides a useful way to help preserve family wealth.

It is worth considering what will happen to future inheritances that you expect to receive. This could perhaps be an interest in a family business. Or maybe a share in a family trust. These future interests can be detailed in a prenup, stating that they are to remain personal property rather than matrimonial. This will help protect these inheritances in the event of a divorce.

Prenups are a valuable way to provide clarity and certainty in a marriage. By doing so, they can help reduce conflict as they set expectations from the outset. They can also help reduce the scope for dispute in the event of separation. A prenup gives both people getting married a clear understanding of their financial position.

It is important to identify exactly what you want to protect with your prenup. This may include a property inherited before the marriage, funds or shares held in a family business or investment portfolio, or inheritances you expect to receive in the future.

Both people getting married must receive independent legal advice before signing a prenup. This makes sure to avoid any suggestion that one party was pressured or didn’t fully understand the terms of the agreement. Full and open financial disclosure from both sides is also essential. Without it, the prenup may be deemed unfair and invalid.

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.

A prenuptial agreement can be a powerful tool for protecting inherited wealth, not just for you, but for your wider family. It offers clarity, fairness, and peace of mind while helping to preserve the legacy of generations before you. If you have received or expect to receive an inheritance, speak to an experienced family law solicitor before getting married.

At Hawkins Family Law, our team can guide you through the process of drafting a clear, robust, and fair prenuptial agreement that reflects your values and protects what matters most. Speak to our leading family law solicitors in Milton Keynes. Our team of specialists can advise and guide you from the moment we start working with you.

In addition to 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.

.