- 05 Sep 2024
- •
- 2 min read
What is a pre-nup?
A pre-nuptial agreement, commonly known as a pre-nup, is a contract made between two individuals before they marry. It outlines how assets will be divided if the marriage ends.
Contrary to popular belief, pre-nups aren’t just for celebrities or those with considerable wealth. They are a practical option for anyone wishing to safeguard assets acquired before the marriage, especially those who have been married before and have children from previous relationships.
Although pre-nuptial agreements aren’t legally binding, they can hold substantial influence if prepared and executed correctly. Having a pre-nup in place can help avoid costly legal battles and reduce the emotional strain associated with financial disputes in the event of a breakup.
To ensure a pre-nup carries weight, certain formalities must be carried out:
- Voluntary agreement: Firstly, both parties must enter into the pre-nuptial agreement of their own free will and without any duress, influence or pressure.
- Full financial disclosure: They must also exchange full and frank financial disclosure with one another so that they have a clear and truthful picture of their respective finances.
- Independent legal advice: It is very important that parties obtain independent legal advice from separate solicitors before entering into a pre-nuptial agreement.
- Fairness and reasonableness: Any pre-nuptial agreement should be fair and reasonable. It is important to take legal advice on this point.
- Timing: It is important to try and finalise a pre-nuptial agreement at least 3 months prior to the wedding. In any case, a pre-nuptial agreement should be finalised no later than one month prior to the wedding. If these timings prove difficult, the parties can consider entering into a post-nuptial agreement instead, which is signed after the wedding.
- Intent to uphold: The pre-nuptial agreement should be entered into by both parties on the basis that, should the relationship breakdown and the parties divorce, the terms of the agreement will be upheld.
Additionally, it is also a good idea to include provisions for reviewing the pre-nup at key life events, such as the birth of a child, to ensure the agreement is still fair and reasonable over time.
While contemplating ‘what if it all goes wrong?’ might not be a priority for most engaged couples, the unpredictability of life underscores the importance of planning for the unexpected. A pre-nup can offer peace of mind by providing clarity and minimising uncertainty about the future.
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