A prenuptial agreement is very similar to insurance policies in the sense that you go to the trouble of getting one but hope you'll never have any use for it. With the staggering number of divorces occurring in the first 7 years of marriage recently (roughly half of all couples in the most recent decade go through divorce), you and yours should at least consider the option before getting married.
Nobody knows what the future brings and, purely statistically speaking, there is a good chance that you find yourself going through a costly and emotionally taxing divorce. A prenuptial agreement is a precaution that benefits both parties.
What is a prenuptial agreement exactly?
A prenuptial agreement or a prenup, is a signed agreement between two people who want to get married. The document lists down their rights and obligations in the event of a divorce and includes information on how their assets and properties should be divided.
Why go to the trouble of getting one?
Divorces are rarely ever clean and smooth processes. Disagreements on how to split assets are very common and are often accompanied by biased feelings from one or both parties. There are disagreements on assets such as stocks, houses, bonds, and finances. There is also the issue of alimony which would take a whole other article to discuss.
How does the typical prenuptial agreement "work"?
Let's say that the husband has $250,000 to his name before his marriage. A prenuptial agreement allows him to keep that same $250,000 after a divorce and can also include all assets bought with that same $250,000 depending on the prenup. If the prenuptial agreement were not in place, the wife would likely be awarded half or more of that $250,000. It depends on the financial circumstances of both parties.
I don't have large assets, should I still get a prenup?
Not too long ago, only those with substantial estates had commonly gotten prenuptial agreements. But everybody, regardless of what they own now, always has something to protect. The future brings unlimited possibilities and you can never be sure what you'll become. You could start a company and make a fortune or find yourself in a lucrative profession. Before dismissing a prenup entirely, take a good look at your situation and decide whether or not you want to take measures to safeguard your long-term future
What can prenuptial agreements cover?
Prenuptial agreements can be simple documents with only a few pages with clear and concise means of separating your assets from your spouse's. It can also be very complex and taking up dozens of pages covering all possible angles such as income, debts, alimony, children, and countless other things.
How do I bring it up with my future spouse?
It all boils down to this. For most couples, this is an awkward and difficult issue to bring up that requires good timing. Generally, you will want to do it sooner rather than later and give your future spouse time to digest and take this fact in. Some days or weeks before your scheduled marriage is not an ideal time to raise the issue. You should both take time to negotiate the "prenup" terms until both of you feel it is fair.
Others have tried passing the responsibility to someone else and saying their parents or their business partner demanded it of them for their own security. But honesty in the matter typically yields better results.
If you find it difficult to approach, remember that there are different perspectives to everything. A prenuptial agreement completely bares all your assets to your future spouse -- giving them a deep and detailed look at your financial worth. Deep trust is needed within both parties for such openness.