What are pre or post nuptial agreements?
Pre or post nuptial agreements are agreements which are entered into either before the marriage or during the marriage and set out what will happen to the assets and liabilities in the event of marriage breakdown.
Why have this type of agreement?
The agreements are of particular importance for second and third marriages and for older parties who are getting married who may have accumulated significant wealth/personal belongings over the years and also those who wish to leave some of their assets to their children from previous relationships..
Many people believe that such agreements are ‘unromantic’, however they may also be viewed as a way of ensuring that you both know what you are entering into when contemplating marriage and they are a form of financial planning to ensure you are marrying for the ‘right reasons’.
What happens if we do not have a pre or post nuptial agreement?
When parties get divorced, if they are unable to reach a fair and reasonable agreement between them it may be necessary to ask the court to make a decision. Judges have a very wide discretion often using a broad brush approach when deciding how to distribute the family finances. Although the starting point for distributions is a 50/50 split, they are not common, and unless parties are very wealthy their respective needs will dictate who gets what. For example, a wife who stays at home with the children has a greater need for financial provision than a husband who has a well paid job. Your pre or post nuptial agreement may mean that you avoid costly and emotional Court proceedings when you are feeling vulnerable. If your marriage breaks down and you are unable to agree a fair and reasonable settlement, your agreement can be taken into account by the Courts and may be found to be binding.
What may be included in a pre or post nuptial agreement
Pre and post nuptial agreements allow you to ring fence certain items, e.g. assets you bring into the marriage and inheritances. They can also be used to limit the amount of monthly payments paid to a spouse and the length of time it is paid.
What do we need to think about before entering into the agreement?
To try to ensure that your pre or post nuptial agreement is binding you will need to ensure that both of you has a lawyer and you will need to decide who will meet the costs for drafting the agreement and the costs of the advice you are both given.
You will need to summarise your financial circumstances in terms of income and assets and that summary should be exchanged with your spouse or spouse to be.
The terms of the agreement should allow for any children of the family that will be born to be properly supported financially.
It should be finalised at least 28 days before the wedding.
We can advise you about what should be included in your agreement and will draft the agreement for you. We will also liaise with your spouse’s solicitor. Contact us on 0115 9888 777.