What is a Pre-Nup?

A Pre-Nup or Pre-Nuptial Agreement is a formal, written agreement between two partners prior to their marriage.   The pre-nup sets out exactly who owns what out of all the couple’s belongings, assets, property and money. You can then list how these will be divided if the relationship should break down in the future.

It is not the most thrilling of thoughts when contemplating marriage to your loved one to raise the issue of a Pre-Nuptial Agreement (Pre-Nup).

Is it because they are unromantic or the preserve of the rich and famous, therefore irrelevant? Increasingly Pre and Post Nuptial Agreements are requested by couples, particularly if you have children from a previous relationship and/or have assets you want to protect.

Why should I have one?

• If you have assets acquired before you met your future spouse and you want to protect them if you break up,  couples can agree how assets acquired before the relationship will be divided, or not, if they were to divorce.
• Business owners can seek to ring-fence business assets they do not wish to share in a divorce settlement.
• Does one of you have significant debt? If so a Pre-Nup could set out who would take on that debt if the relationship ended.
• If you have children from a previous relationship, a Pre-Nuptial Agreement can ring-fence assets you wish children from a previous relationship to receive.
• Agree how finances will be managed.
• To aid a more amicable divorce. Divorce can be upsetting and stressful. Having an advance agreement that sets out how finances will be divided on divorce can prevent future disputes and costly litigation.
• Once you are married, any assets you formally owned yourself may become matrimonial assets. If they are treated as matrimonial assets, they may be shared between you and your partner. A Pre-Nup could save you thousands if things don’t work out.

Is a Pre-Nup Binding?

Pre-Nuptial Agreements are recognised by the courts in the UK but crucially they are not binding. Whilst they are usually upheld where:

• The agreement is freely entered into.
• Both parties understand the implications of the agreement.
• The agreement is fair.
• The agreement has been made at least 21 days before the wedding.
• There is disclosure about the wider financial circumstances.
• Both parties received legal advice.  The safe bet is to insist legal advice is taken to avoid any claim that your spouse did not understand what they were signing.
• It does not prejudice any children.
• Both parties’ needs are fairly met.

If the Court feels that the agreement is not fair in the circumstances of the case, it can reject the Pre-Nup. Your aim should be to make an agreement that lays out how you and your partner would divide things fairly should your marriage end.

Ideally, a Pre-Nup Agreement should be considered and discussed well ahead of your marriage. You and your future spouse should each have the benefit of legal advice and disclose your finances to each other. The Pre-Nup should also be signed in good time before your wedding day, at least 21 days before but ideally longer. The longer the better as this give the time to consider the document, take advice and, if necessary, negotiate different terms.

At Vincents, we will assist and guide you through the Pre-Nuptial Agreement process.