While the idea of signing a prenuptial agreement might seem unromantic and pessimistic, they can be invaluable for protecting your assets should you and your partner wish to separate.
At VM Family Law, our family law solicitors have extensive experience guiding and assisting couples with their prenuptial agreements.
What is a Prenuptial Agreement?
A prenuptial agreement, or prenup, is a type of legal document that is made before a marriage, outlining how each of the person’s assets will be divided between them in the event of a divorce. They are usually put in place when one partner has, or is soon to have, more assets than the other.
Assets including property, debts and income are usually covered in a prenuptial agreement to help couples avoid any financial surprises if the marriage were to break down in the future.
Are prenuptial agreements legally binding in the UK?
Prenuptial agreements are not legally binding in England and Wales, but they will usually be upheld by courts so long as they meet the qualifying criteria.
The criteria is set out by the Supreme Court, and further reviewed by the Law Commission, includes:
- The agreement must be freely entered into
- Both parties must understand the implications of the agreement
- The agreement must be fair
- It must be contractually valid
- The agreement must have been made at least 28 days before the wedding day
- Both parties must have received legal advice
- The agreement should not injustice any children
- Both parties needs must be met
What can be included in a prenuptial agreement?
Prenuptial agreements are set in place to protect a number of different assets, and they can be completely tailored to yours and your partners needs.
They will usually contain an inventory of each of your assets, detailing how you both wish for them to be looked after during your marriage and how they will be divided if your marriage breaks down.
Prenuptial agreements usually include:
- Property held in your sole name or in joint names
- Savings held in bank accounts
- Premium bonds
- Inheritance
- Stocks and shares
- Pension pots
- Income
- Business interests
The best place to start when you’re creating a prenuptial agreement is to make a list of all the assets you own, solely and jointly, and then decide how you would deal with them in a divorce.
What can’t be included in a prenuptial agreement?
Although prenuptial agreements cover a wide range of assets, there are a few things which cannot be included in the agreement. It is vital that you consider these when you sign a prenuptial agreement, otherwise it may not be held seriously in court.
A prenuptial agreement cannot include:
- Child custody, including visitation
- Child support
- Personal matters
- Lifestyle matters
- Illegal or unfair matters
The pros of prenuptial agreements
A prenuptial agreement can be extremely beneficial for a number of reasons.
- One of the biggest advantages is that it protects both parties’ assets in the event of divorce or death. It also helps to ensure that the couple’s assets are divided fairly.
- Another benefit of prenuptial agreements is that they can help to reduce the stress and conflict that can arise during a divorce. Having the agreement in place lets both parties know exactly what to expect if their marriage breaks down. This can help reduce the time and money the couple would have spent settling assets in court.
- Prenuptial agreements are also extremely beneficial for those who have business interest, inheritances and investments that will come to them in the future. This can also be particularly beneficial if one partner has accumulated significant wealth before the marriage.
The cons of prenuptial agreements
There are a few cons to be aware of in a prenuptial agreement:
- As we’ve mentioned, a prenuptial agreement is not legally binding. If the court deems that it would be unfair to uphold the agreement, then the time spent deciding which assets will be shared or held solely will be wasted.
- A prenuptial agreement cannot predict what will happen during the marriage and significant changes in circumstances could occur. For example, you may have more children, lose your job or become seriously ill. Should circumstances change, a prenuptial agreement that does not anticipate these events will likely not be held up in court.
- A court considering the financial implications on a divorce will primarily focus on ensuring any children in the family will be financially secure. Your prenuptial agreement, which may have been produced many years before any children, is not likely to be in the best interest of your children now.
If you or your partner wish to make provision for existing children in the prenuptial agreement, you can do so, but you must be aware that circumstances can and likely will change.
Getting started with a prenuptial agreement
If you and your partner are considering putting a prenuptial agreement in place, it is vital you seek advice from professionals who have experience drawing up agreements for a wide variety of couples.
Our highly experienced team at VM Family Law have a huge amount of knowledge when it comes to drafting prenuptial agreements and tailoring them to meet your specific needs as an individual, and as a couple.
Please contact us today if you’d like to find out more on creating a prenuptial agreement.