“Will you enter into a prenup with me?” Eight words potentially loaded with uncertainty and the possibility of a few awkward conversations. Not nearly as romantic as the four words that will have crossed many lips on Valentine’s Day: “Will you marry me?”
Valentine’s Day is statistically one of the most popular days of the year to get engaged (alongside Christmas and New Year) and dozens of couples will spend the next few weeks spreading the good news, looking at venues and planning probably the most expensive 24 hours of their lives.
Talking about finances with your other half can often feel like a taboo subject, especially in the run up to the big day, when there are so many other, seemingly more pressing, things to think about. However, open and honest communication is a key ingredient for any long-lasting relationship, and this should apply equally to finances as to every other aspect of a successful life together.
It is important to feel able to have frank conversations about finances in a relationship and to understand what both people’s expectations are, not only about who will contribute what financially during the relationship, but also the financial consequences in the unfortunate event that the marriage or civil partnership comes to an end, whether it is months or years down the line.
A premarital or prenuptial agreement can be seen as putting a dampener on the romance and thrill of a forthcoming wedding, but considering long-term finances is as important as the preparations for the big day. Statistically, it is estimated that 42% of marriages now end in divorce and more and more people are remarrying or entering into a new civil partnership as the average length of a relationship gets shorter. If you faced those kind of odds in any other area of your life you would want to take out insurance against the worst happening.
As more couples are getting married or entering into partnerships later in life, and perhaps not for the first time, individuals are often going to be starting married life in very different financial positions. A “prenup” can be a means of protecting any wealth or assets brought to a marriage or civil partnership, or inherited, should you separate.
In 2014, the Law Commission indicated that premarital agreements, though not automatically binding, would be increasingly upheld by the courts on divorce or dissolution, provided that they complied with certain requirements.
For some there is a concern that raising the possibility of a “prenup” risks some potentially uncomfortable conversations but this need not be the case. Entering into a “prenup” need not be viewed as an indication that you fear the relationship may fail. Instead it is a clear intention that both of you want to be honest and upfront about your financial circumstances and intentions from the very outset. It is therefore best to discuss at the earliest opportunity, rather than leaving it until the last minute (not least because the timing of signing a prenup could have an impact on its enforceability in the event of a future separation). It should also be viewed as a positive step in that both of you are seeking to avoid any emotional or financial cost should you separate, by removing the potential for difficult and lengthy discussions through solicitors later on down the line. To that end it may be one of the most cost efficient steps you could take in the run up to the big day.
The Family team at TLT frequently advise in relation to prenuptial, post-nuptial and cohabitation agreements. We can advise individuals who are getting married, entering into a civil partnership, or perhaps even moving in with someone for the first time, and help explain the legal rights and obligations at every stage of a relationship.
This article first appeared on www.tltsolicitors.com on 23 February 2015.