Dear first mates,
Wishing all of you a happy new year. I hope 2023 brings you everything you want and more. To start the year, I’d like to tackle the subject of prenuptial agreements (Prenups). I understand that prenuptial agreements can be difficult to discuss, but they are an important consideration for anyone getting married.
Marriage is indeed a beautiful thing, and it can bring a lot of joy and companionship to people’s lives. However, not all marriages are successful, and the high divorce rate in the United States reflects that reality.
But just because the percentage of marriages that end in divorce is high, it doesn’t mean that all marriages are doomed to fail. Many marriages are successful and last a lifetime, and many people who divorce later remarry and have successful relationships.
A prenuptial agreement is an agreement made by a couple before marriage that addresses the ownership of their respective assets in the event of a divorce. While a Prenup does not address issues related to child support custody and support, a Prenup can help protect both parties in many ways. Some common reasons include the following:
- Answer questions such as what is considered marital property or separate property.
- How assets, business interests, property, and debt will be distributed.
- If any spousal maintenance or other ongoing financial obligations is owed to one spouse.
- Simplifies the divorce process as both parties have agreed on terms that can reduce stress and emotional suffering during a difficult time.
- Allows the couple to make decisions about their finances rather than rely on state laws.
- Help couples who have children from previous relationships.
- Protect expected inheritances or insurance payouts.
- Prenups may help prompt other meaningful money conversations that ensure a lasting, happy marriage.
- If both spouses have different financial goals and plans or different expectations regarding retirement saving.
If a prenup is a valuable tool, why do they feel so taboo…so uncomfortable? There are various reasons why people may not choose to get a Prenup. Here are some common reasons and my thoughts on each:
- They believe it is not romantic or view it as a sign of mistrust (planning for the worst)
This view is totally understandable. However, viewing a Prenup as a practical tool that can protect both parties in the event of a divorce is crucial. Why? It’s easier to make decisions about finances when the couple is in a healthy place and trusts each other, unlike during emotionally charged divorce proceedings. A Prenup should come from a place of love and compassion for each other, and it also shows your spouse that you intend to respect and honor their decisions.
- They think it is only for the wealthy.
It is a common misconception that Prenups are only for rich people. Prenups can be beneficial for couples of all income levels and financial situations. A Prenup can protect both parties’ financial interests in the event of a divorce, regardless of who has more. In fact, according to Forbes, divorce is one of the top five reasons people go bankrupt so think of a Prenup as bankruptcy protection!
- They believe it is unnecessary as their marriage will last forever.
Couples divorce for many reasons, with the divorce rate ranging between 39% to 50% pending on the study. Unfortunately, divorces are messy, expensive, and can last for too long.
- They think it is too expensive.
While the cost will vary based on the state, the complexity of the case, and the attorney used, creating a Prenup will be far cheaper and more efficient than dealing with it during a divorce. Divorces are expensive and time-consuming, as people may not be their best selves and need more time with their respective attorneys.
- They believe it is not legally binding as a judge can overturn it.
When individuals marry, they are subject to the divorce laws of their state of residence. By creating a Prenup, a couple takes control of their finances with reduced involvement from state judges and attorneys. Both parties must have their own legal representation to ensure that the agreement is fair and will stand up in court. Both parties need to understand Prenup’s process, legalities, and benefits before signing one. A good Prenup will contain exhibits showing the whole financial picture of both parties.
- They believe it will be unfair, particularly to the spouse with a lower income or assets.
A Prenup must be fair and equitable and cannot appear one-sided, deceptive, or exploitative to be legally enforceable. Additionally, many jurisdictions require that individuals be given a certain amount of time to review and negotiate the terms of the Prenup before the marriage date with their own legal counsel. If this time is not provided, the Prenup can be considered unenforceable as it could be seen as signed under duress.
In conclusion, a Prenup is the first investment in the future of your relationship and the responsible thing to do. It can be viewed as a form of marriage insurance, similar to how you would insure a home. Divorce is already difficult – no need to add finances to it. A Prenup can save you a lot of headaches and financial worries in the future. Lastly, I hope your Prenup is never used and just sits in the drawer forever!
Sources & For Further Reading
Prenups for Lovers by Arlene Dubin
7 Reasons to get a Prenup by LegalShield
Protect Your Assets by Justin Reckers
48 Divorce Statistics by Diovrce.com
You need a Prenup by Harlan Vaughn
The Divorce Rate is Dropping by Time
The Pros and Cons of Prenups by Geoff Williams
Top Five Reasons People Go Bankrupt by Forbes
Causes of Divorce by Divorce.com
Dating: Don’t waste your time by PragerU
Is Marriage Good for Men by PragerU
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