A prenuptial Agreement, more commonly known as a “prenup”, sets out what will happen to you and your spouse's assets and income in the unfortunate event of divorce, separation or death.
Having a prenuptial marriage agreement does not mean that a couple is anticipating a divorce. At the end of the day marriage itself is a contract and a prenup is a way of putting guidelines or terms on that contract. It could be considered unromantic but it is simply good financial planning.
As people put off marriage until later in life than previous generations, they are more likely to have careers, businesses and property and therefore they are coming to a marriage with more accumulated wealth. They are more protective of what they have built. This can also apply to student debt. As student debt loans continue to represent substantial figures it is a way to ensure their is clear ownership and responsibility for that debt.
People are not only getting married later in life they also tend not to consider getting married until they are more financially secure. A prenup is viewed by many as an extension of that fiscal responsibility.
Prenuptial agreements can protect assets and future income. As people marry later they are often more advanced in their careers and can see their future financial roadmap. In addition in an era where technology has provided a platform for individuals to create businesses with minimal start up capital yet receive significant financial returns, protecting that potential future asset is important to many.
Anyone who wishes to protect wealth and future income. Prenups are no longer reserved for the rich and famous. They are far more common today than at any other time and there is a level of acceptance within society that views a prenup as prudent financial planning.
Multi generational wealth and estate planning will often consider a prenup as part of that planning. While many families may have family wealth protected within trusts some families do not have trusts, however they still wish to preserve familial wealth. Sometimes a prenup will ease parental anxiety over upcoming nuptials.
A prenup means parties enter into a marriage making informed decisions and truly understand the terms of the marriage contract. This transparency can often help the parties in managing expectations within the marriage. Managing expectations, transparency and financial visibility can all be the very reasons that can make a marriage last.
This is a legally binding contract and parties should make informed decisions within a environment that fosters a non-adversarial process. Parties wish to utilize a process that at its core is a peaceful and respectful process. It is that forum that should be used to negotiate terms for hopefully a happy and life long partnership. The process should be seen as a collaboration not a reason to be adversarial.
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