Prenups have long been seen as rich people business. But today, more everyday couples are realizing they’re just smart financial planning. This isn’t just a lifestyle for the rich and famous, however. Which is why we need a mindset shift around certain aspects of marriage.
So what exactly is a prenup? At its core, it’s a straightforward agreement about how your finances will be handled if things don’t go as planned. While the primary reason for marriage is (hopefully) love, it’s always wise to protect what you’ve built before meeting your spouse. If you have assets like property, a business, retirement savings, investments, or family inheritance, a prenuptial agreement can be a beneficial tool. In essence, a well-crafted prenuptial agreement can offer a significant peace of mind.
So, What Is A Prenup Exactly?
In simple terms, a prenup is an agreement between a couple before they enter a civil partnership or marriage. It outlines how they want their assets to be divided in the event of a divorce or dissolution of their civil partnership. Creating a prenup involves open and honest communication about each person’s financial situation and what they want to protect. It’s not about planning for divorce, but about setting clear expectations and protecting each other’s interests. There are also instances where couples define these terms after they are married or in a union, which is known as a post-nuptial agreement.
Planning a future with someone means ironing out a lot of details. Where will you live? Are you changing your last name? How much do you want to spend on the wedding itself? What religion will your children be introduced to? What expenses will each person be responsible for? It’s important to discuss every detail down to the last penny…literally. Finances are a huge component in relationships. In fact, financial problems and debts are one of the leading causes of divorce.
Consider this–in any other scenario, we have coverage for ‘just in case’ situations like a broken cell phone, a car accident, or even a business partnership. A marriage should be afforded the same practical protections, ensuring that you are prepared for any eventuality.
Prenups Aren’t Just For The Elite
A prenup is not a sign of pessimism, but a practical tool (and a nod to financial literacy) because even the best intentions in marriages can result in disaster, and it’s okay to have a plan to mitigate the potential fallout.
Sheena Douglass, a divorced single mom of three, deeply regrets not signing a prenuptial agreement. “I was the breadwinner in my relationship before marriage, and money didn’t seem like an issue,” she shared. Despite everyone encouraging me just to protect myself, I believed that in a marriage, everything was ours, even when it was mainly me providing most of the time.” Her ex-husband wiped out several bank accounts and disappeared, leaving her and their children practically penniless. “Between three bank accounts, less than $275 remained. I lost so much–including our home and having to do a voluntary repossession of our vehicles because I could not afford it.” Douglass and her children were fortunately able to move into her parents’ home. It took nearly five years to clean up the damage of a scorned spouse that could have been prevented by taking the necessary precautions. This is a powerful reminder that a well-crafted prenuptial agreement can avoid such situations and give you control over your financial future. Douglass’s scenario is familiar to family law attorney Lasheena Williams, reiterating the idea that a prenuptial agreement can be helpful to protect assets that were acquired before the marriage.
“Once a marriage turns sour,” she says, “people will sometimes fight to the bitter end over minor issues, and a well-drafted prenuptial agreement can avoid these types of petty squabbles. It can also protect against tedious situations that can drag on due to overly long court processes, such as determining who remains in the home, how to handle the vehicles, and many other issues that can linger for months or even years until a divorce is finalized.”
Williams shares that other couples who can benefit from a prenuptial agreement are those who come to their marriage with children from a previous relationship, as it can protect any assets designated for them specifically. If you or your future spouse owns a successful business before your upcoming marriage, and you want to lock in any support you will receive or provide for your spouse in the event of a divorce. It can also deal with debts you or your spouse may have, which you can protect the other from. The latter is also something that Douglass had to contend with. “My husband was flirting around his newfound singleness and freedom from parenting, all while wracking up an insane amount of debt. So much of that fell on me to fix, too.”
And, there are couples in which one may come from money and generational wealth. A situation that Andre Mack found himself in before tying the knot to his wife in January of 2008. He signed a prenuptial agreement at his wife’s request. “When people hear this term, prenuptial agreement,” he says, “it scares them because they believe it propagates the idea of divorce or merciless demise. And it’s really quite the opposite. For us, this document was more about protecting the legacies her family had built before we met each other—not about predicting failure or divorce.”
Prior to walking down the aisle–or in the event of changes in your financial circumstances during marriage, whether involving wealth or debt—it is advisable to discuss these matters thoroughly with your partner, as well as consult with a lawyer or financial advisor, to determine the most suitable approach for your relationship.