Solicitor Kim Marshall from Keystone Law gives us the lowdown on pre and postnups
A prenup is an agreement made by a couple before their marriage (or civil partnership) which makes provision for the separation of their assets and income in the event that their union ends. A prenup can also set out how a couple should deal with their finances during their marriage, for example whether a joint account will be opened and how property and other assets should be held.
A prenup can help safeguard family wealth and ringfence inherited or business assets. Prenups are becoming increasingly popular, particularly with those who marry later in life who may wish to reserve certain assets for their children or grandchildren and ensure that their inheritance rights are protected (it is also crucial to make a will for the same reason). Those who have experienced an acrimonious divorce may also be keen to obtain a prenup before tying the knot again, to ensure there will be fewer arguments and a less costly breakup should the relationship not last.
A prenup is tailored to the individual couple’s needs, to make the process as friendly as possible. It is a good idea to discuss the prenup with each other first in broad terms and perhaps with other family members. A specialist solicitor can then be instructed to prepare a draft agreement based on these discussions. The couple can always negotiate the terms of the agreement between themselves or can ask solicitors to do this on their behalf.
It is important to start discussions well in advance of the wedding or civil partnership ceremony to ensure there is sufficient time for the prenup to be considered and signed. The Law Commission’s recommendations are that that a prenup should be signed at least 28 days before the wedding to avoid any situations where it may be signed ‘under duress’. Of course, there is a lot to think about and do in the run up to a wedding, and the preparations can be particularly time consuming. It is not unusual for my clients to run out of time and fall foul of the 28-day recommendation. In these circumstances, the agreement can be signed after the wedding and it then becomes known as a postnup. A postnup provides the same financial protection as a prenup and can be signed by a couple at any point during their marriage as part of overall financial planning and to ringfence assets.
There are certain requirements to follow to ensure that a prenup has the best chance of being adhered to. For example, both partners should disclose to the other details of their respective incomes, assets and debts. In this way, there will be no surprises at the outset of the marriage as each person will be familiar with the other’s financial position. Discussing financial issues can be one of the most difficult aspects of a relationship and dealing with this at the outset can truly strengthen a relationship and support good communication going forward. Both partners should also have their own independent legal advice about the effect of the terms of the agreement.
A prenup can offer many advantages but it is important to consider your situation and goals carefully before entering into an agreement. Ensuring it is the right decision for you and your partner before signing anything is crucial. For further guidance and a free initial consultation, contact Kim Marshall of Keystone Law.
Kim.Marshall@keystonelaw.co.uk
