A prenuptial agreement, otherwise known as a ‘prenup’ for short, is a written contract created by two people before they are married. It’s designed to provide clarity and certainty around the arrangements in the event of a breakdown of a marriage. It saves time and the stress of arguing about the finances at a later stage. It typically lists what each person owns, including debts, and specifies how money and assets will be split.
No one enters into a marriage expecting it to fail, but if a prenup is something that you are considering, it’s really important to know how they work.
Why might you consider a prenuptial agreement?
There’s almost a taboo around considering a prenup. Many people see it as anticipating the breakdown of a marriage before it has happened, but it doesn’t need to be that way. Getting a prenup is simply about considering every eventuality and making sure that your finances, your future, and your children’s futures are secure – no matter what happens. That’s got to be worth giving a second thought.
Prenups are common amongst wealthier couples as they may have more of a need to protect their assets. Perhaps one party has a large inheritance or owns property or business. In normal circumstances, most couples consider a 50/50 split the starting point in the event of a divorce, however, a prenup allows you to make more specific arrangements if one of you is wealthier than the other and wants to protect their wealth.
That being said, prenups can also be incredibly valuable for couples of more modest means, and there is a range of reasons why. You might consider a prenup if:
- You want to clarify financial rights
- You want to avoid arguments about how things will be divided in the event of a divorce
- You want to pass separate property to children from prior marriages. Without a prenup, a surviving spouse might have the right to claim a large portion of the other spouse’s property, which may not leave much for the children
- You want to get protection from each other’s debts
What happens if I don’t get a prenup?
It’s fair to say that the majority of couples in the UK do not have a prenup, despite having a 33.3% divorce rate. Without a prenup, you will need to work out what you are entitled to in a divorce – which can be difficult when emotions are already running high. If you fail to decide how to split your assets, a Judge will decide for you. When doing so, they will take the following into account:
- The needs and welfare of any children under the age of 18
- The income, earning capacity, property, and other financial resources which each of the parties within the marriage has or is likely to have in the foreseeable future
- The financial needs, obligations, and responsibilities which each of the parties has or is likely to have in the foreseeable future
- The standard of living enjoyed by the family before the breakdown of the marriage
- Any physical or mental disability of either of the parties to the marriage
- The contributions which each of the parties have made or are likely in the foreseeable future to make to the welfare of the family
- The duration of the marriage
Is a prenup legally binding?
In the UK, a prenup is not yet legally binding. A prenup does still carry very significant weight and will be upheld by a court so long as it meets a certain set of criteria as decided by the Supreme Court and further reviewed by the Law Commission. This is as follows:
- The prenuptial agreement must be freely entered into
- Both parties must understand the implications of the agreement
- The agreement must be fair
- The agreement must be contractually valid
- The agreement must have been made at least 28 days before the wedding
- There should be disclosure about the wider financial circumstances
- Both parties must have received legal advice
- It should not prejudice any children
- Both parties’ needs must be met
As a prenup must meet these criteria, it is wise to enlist the help of a solicitor to either assist you in deciding and writing the terms of the agreement or have a solicitor look over your agreement if you have already put it together. This will save you having your prenup disregarded by a Judge in the event of a divorce.
How can Bromfield Legal help?
Here at Bromfield Legal, we work with you personally and tailor prenuptial agreements to your own specific requirements. Just like you, we want to make sure your finances, assets, and property ownership are set out clearly and fairly. You can trust our expert advice and support to save you money when you need it most.
Need to speak to an expert? Just get in touch via our online enquiry form or give your nearest Bromfield Legal branch a call.