Prenuptial Agreements
“I LOVE my Fiancé – Why do I Need a Prenup?”
I here this comment frequently. Most people erroneously assume that if you are in love (and while you are in love) that discussions about the possible need for a prenup (also called an antinuptial agreement) imply that you do not trust each other. Some think prenups imply that you are more interested in money or financial security than the actual relationship itself.
“If we love each other, why do we need a prenuptial agreement? I promise I will take care of you! Haven’t I always taken good care of you???”
People assume that having a pre-nup or even discussing it will have negative implications.
The other objection I here is that there is no need for a prenup if neither party to the marriage has any money. It is often assumed that Prenuptial agreements are only for the rich.
Both lines of reasoning couldn’t be farther from the truth.
I believe that having a prenup makes good sense. Having been in the divorce business for almost 30 years now, I have seen time and time again that there is no correlation between how much you love each other when you get married and how long your marriage actually lasts.
In fact, love is the worst indicator of how long your marriage will last. The best indicator is actually how well you communicate with each other. Most of us have developed the same styles of communication that we learned from our parents.
Yes, it is learned behavior. Many times that style of communication is not very effective or productive when faced with the inevitable problems and conflict that come up in every marriage.
Being able to talk about money and finances and resolve differences is vital to a having a successful marriage. Unfortunately, most couples do not spend near enough time prior to marriage discussing these issues.
Drawing a prenuptial agreement will force both people to have exactly these type of discussions. And importantly, both parties are required as a part of this process to put together a compilation of their assets and liabilities so there is no issue “after the fact” about the value of each person’s individual pre marital property OR their debt situation.
Once having an opportunity to review each other’s financial positions, you can ask he/she to provide documents or to let your accountant or other financial advisor review them. More often than not, this is not necessary unless one person’s estate is very complex.
And don’t forget that even though neither of you may have any significant assets or debt when you get married, you may stand to inherit assets or funds. If this is even a possibility it behooves each party to find out what actions each can take to make sure that those funds/assets are protected.
Also, if this is a second marriage and/or there are children of the prior marriages, it is important to discuss how each person would like to protect assets for their respective children or grandchildren.
Preparation of a prenup is insurance and provides valuable information in the event of divorce – and statistics say that at least 50 % of first marriages, higher for second and third marriages will end in divorce.
The cost of the prenup usually depends on the complexity of the estates and may be charged at the attorneys hourly rate or a set fee may be requested.
One thing is for sure. Money spent on a prenuptial agreement is money well spent.