What is a Prenuptial Agreement?
A Prenup is an agreement that two people enter into before they get married (or enter into a Civil Partnership) and agrees what should happen in relation to their finances in the event their relationship breaks down.
It is important that Prenuptial Agreements ensure that both parties reasonable needs are met in the event of divorce or dissolution of a civil partnership. It should be drafted following full financial disclosure from both parties so there is a clear understanding of each other’s financial situations. It is crucial that both parties have taken their own independent legal advice, that the outcome of the agreement is fair, and there is no duress on either party to sign it.
What does a Prenuptial Agreement cover?
A Prenuptial Agreement should take into account all issues relating to your finances, particularly detailing any pre-marital assets, for example property, investments or pensions accrued before your marriage. It is also prudent to consider what inheritances may be received in the future.
You should consider what you each have now and what you each want to do with your assets. Consider what the position would be if you have children (or more children). You can also outline what should happen in the short term if there was a separation. Prenups help protect personal assets by clearly defining what belongs to whom. This is helpful for individuals with significant personal or family wealth, business interests, or valuable personal property. In the event of a divorce, these assets are less likely to be contested or divided, as their ownership is predetermined. For example, Prenups can also be used to ring-fence inherited assets or family heirlooms in the event of a marriage breakdown.
Prenup FAQs
The cost will vary depending on the complexity but expect to pay a minimum of £2,000 to £4,000 plus VAT. However, costs can be significantly more depending on the assets at stake and the negotiations needed to reach agreement.
A Prenup should be entered into well in advance of the wedding day or Civil Partnership. The process should be planned in advance, with the help of independent legal advice on both sides, to ensure there is no duress or time related stress on either party to sign it.
This could happen in limited and specific circumstances. And example would be if one party has placed undue pressure on the other party to sign the agreement.
It does depend upon the case in question but often a Prenuptial Agreement will protect assets acquired prior to the marriage. For example, it may be one party owned a property in their sole name prior to the marriage or it may be that one party has received an inheritance and such assets can be protected as part of the Prenuptial Agreement.
Yes, they are a good idea, and a typical situation where Prenuptial Agreements can be beneficial is where parties are marrying for the second time and want to protect assets that they have acquired prior to the marriage.
A Prenuptial Agreement will last for the lifetime of the marriage but it is often advisable to incorporate a review clause in the agreement in certain situations, for example if the parties are planning on having children in the future, then this can be a trigger for there to be a review of the agreement.
There is no legislation currently in force which provides that Prenuptial Agreements are legally binding. The current law regarding these agreements is that a court should give effect to them if they are freely entered into by each party with a full appreciation of their implications unless in the circumstances of the case, it would not be fair to hold both parties to their Prenuptial Agreement.
They can do, depending upon the circumstances as referred to above. It is important when entering into a Prenup that the terms of the agreement are fair and reasonable and crucially that the agreement meets the parties’ respective needs and the needs of any future children. It is important that the parties enter into the agreement with the full knowledge of each other’s finances and with them both having had the opportunity of independent legal advice. It is also important that the agreement is not rushed in to and is signed at least 28 days before the marriage.
It depends upon the particular circumstances but once the parties are married, the Prenup should not affect the marriage as such unless the parties have provided for there to be a review clause. Often those parties who have a Prenup will feel reassured and happy that an agreement is in place should they ever decide to separate.
Again it will depend upon the particular circumstances, but parties will want to ensure that they have made provision in particular for housing needs to be met in the event they should separate, and that their income needs should be met and often a Prenuptial Agreement will distinguish between matrimonial property and non-matrimonial property. If the parties are planning on having a family, then provision should be made where possible in the Prenuptial Agreement or provision can be made as referred to above for there to be a review clause in this instance.
No, if you are already married, you would need to enter into a Postnuptial Agreement.
The parties, with the help of their legal advisers, need to agree upon the terms of the agreement, and then once this is finalised and signed by the parties, each party retains a copy together with their solicitors.
It can, but this may prove difficult depending upon the circumstances and how much information is available. It may be reasonable to have a review clause say in 3 years or 5 years’ time and then the position could be reviewed at that time.
If one party does not comply with the terms of the Prenuptial agreement upon divorce, then court proceedings will be required.
In theory parties could draft their own agreement, but this could be problematic given the various matters that have to be carefully thought through. We recommend that each party seeks their own independent legal advice.
Each party’s signature should be witnesses by someone who is over the age of 18 and independent, so not a family member.
Both parties, together with their respective solicitors if they have legal representation.
A party can seek to provide that they do not believe the Prenuptial Agreement is fair and reasonable and it would then be a matter for the court to decide taking into consideration all the circumstances.
Yes, with the agreement of both parties.
No, and in our experience often parties who have a Prenuptial Agreement feel more secure in the knowledge that they have agreed what will happen if they should divorce.
Often parties will want to mirror the provisions of their Prenuptial Agreement in their respective Wills, and provision can be made accordingly in the Prenuptial Agreement in this respect.
Prenuptial agreements are particularly beneficial for preserving family wealth and inheritance. They can specify that certain assets, such as family heirlooms, property, or future inheritances, remain within the original family. This preservation ensures that family wealth is passed down to children or other relatives rather than being divided in a divorce settlement.
While prenuptial agreements and cohabitation agreements serve similar purposes, they are used in different contexts. A prenuptial agreement is designed for couples planning to marry, outlining the financial arrangements should the marriage end in divorce. It addresses asset division, spousal support, and financial responsibilities during the marriage.
A cohabitation agreement, on the other hand, is for couples who choose to live together without getting married. It outlines the financial arrangements and responsibilities of each partner during the relationship and in the event of a separation. Cohabitation agreements can cover property ownership, financial contributions, and arrangements for children, offering legal protection similar to a prenup for unmarried couples.
Why Hawkins Family Law?
We are specialist family law solicitors, focusing solely on matters such as Prenuptial Agreements, and are committed to providing consistently high levels of support. Our Prenuptial Agreement solicitors at Hawkins Family Law are here to offer you specialist advice and guidance.