It’s easy to be swept along on the crest of a rose petal-littered wave in the heady days of an early romance, and that’s wonderful. You should enjoy every minute. But when the engagement rings come along, make sure you and your partner take a step back from the excitement. You should have a careful overview of your current financial and legal situation and consider whether a prenuptial agreement is appropriate for you. After all, underneath the cake, flowers and wedding attire, a marriage is a potentially life-long financial contract which you should go into with your eyes open and a clear plan in place which you both agree upon.
Getting on the same page about money is the cornerstone of a healthy, happy and supportive relationship. Here are the five ways having a prenuptial agreement discussion can help divorce-proof your marriage.
1) Prenups encourage honesty
Writing a prenuptial agreement is a chance to lay out all the cards on the table and get, proverbially, financially naked. Are you or your partner burdened by credit card debts or lingering student loans? What is your credit rating? What property and assets do you own and what are you expecting to inherit? Now is the time, before the vows are spoken, to get real with your partner about your respective financial situations.
Entering into a marriage is a serious, legally-binding and potentially lifelong financial contract. Wouldn’t you consider other long-term investments, like buying a home or starting a business, with the same gravity? Wouldn’t you want to know what you’re getting into first? If there are some financial assets or burdens you haven’t yet disclosed to your partner, they’ll want to hear it sooner rather than later.
So hold a space with your partner in which you can be upfront, non-judgmental and realistic together. It’s time for full disclosure.
Learn how to include an engagement ring your prenup.
2) Prenups help you start to plan your sexy financial life together
This might be your first time to sit down and have a serious discussion about finances, but prepare for a lot of them. They will come when you need to take out a mortgage, pay the bills, plan a holiday, save for your kids’ college education, or plan for your pension – there’s a long list of financial marriage milestones coming your way.
Drawing up a prenuptial agreement is an opportunity to fine-tune and align your respective financial wishes for the future, and ensure you are on the same page. After all, according to the Institute for Divorce Financial Analysts, financial disagreement is one of the leading causes for a breakdown in marriage.
It is much sexier to be on top of your budget and mutually working towards a financial plan than fighting over who should pay which bill and letting resentments (and debts) build up. Your future together will be much more secure if you can learn to have these conversations in a mature and respectful manner. You’re on the same team now.
3) Prenups protect each of you in the worst case scenario (the dreaded D- word)
Who wants to prepare for the worst when they are hoping for the best? Marriage should be one of the biggest and most heartfelt commitments of your entire life, right? Nevertheless, you will hear a much more pragmatic take on the subject of prenups from someone who has gone through a nasty divorce and learned their lesson the hard way.
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Couples dragging each other through the mud for every last penny while clocking up astronomical legal fees is more common than you may imagine. According to Forbes, the average divorce costs between $15,000 and $30,000.
Have the emotional honesty to admit that many things could go wrong between you, and while you will each endeavor to work together through the issues you encounter, divorce may be the only option left. Having a prenup in case of a divorce will make that process far smoother and pain-free (and less expensive, too).
4) Prenups allow you to make your own rules
Just like you may opt to write your own wedding vows rather than using those prescribed by whichever religion you and your families believe in, selecting your own prenuptial agreement allows you to take control rather than falling back on the default of your state law.
State law determines how your property is divided in the event of a death or divorce. In the eyes of the law, “equal” and “fair” are not necessarily the same. Generally, your property will be divided equally if you live in what is known as a Community Property State, whereas your property will be divided up fairly if you live in a Shared Marital Property State. When dividing property “fairly” in divorce proceedings, judges will consider whether one partner sacrificed their career to raise the family, has become disabled, or obtains a generous retirement package.
As Erik Newton states in a New York Times article, “Every married couple has a prenup, whether they want one or not… The question is not whether you should have a prenup, but whether you want your state’s default version of one.”
It’s your prerogative to fall back on your state’s default law, but a prenuptial agreement offers you both a lot more control to assert your own definition of “fair”.
5) Prenups whip off those rose-tinted glasses
In the course of these financial discussions with your partner, you come across some non-negotiable issues. You may sense there is a serious mismatch between your visions for your future together, your values and approach to financial management.
Perhaps you’ll see warning signs that your partner is going to be overbearing, controlling or emotionally abusive. Or perhaps they seem disengaged and irresponsible. In the twenty-first century, both partners can take equal responsibility in the financial affairs of a marriage. Embrace this new equality and share it out accordingly.
Before you are legally bound to this person for the foreseeable future, now is your opportunity to address any conflicts, compromise, or go your separate ways. Those rose-tinted glasses can’t stay on forever.
Opening the Prenuptial Agreement Discussion
A taboo still lingers around the topic of prenuptial agreements. They have a bad reputation, partly because of tales of unscrupulous wealthier husbands and their families coercing brides into signing a prenuptial in the weeks or even days leading up to the wedding. In the eyes of the law, however, coercion is generally grounds for dismissing the legality of a prenuptial agreement.
Thankfully, the public discourse is now shifting and many women and men have begun to embrace the prenuptial agreement as an empowering tool which helps protect their rights in the event of divorce. But if you’re still hesitant to bring up the word in front of your fiancée, fearing to be seen as a greedy and selfish cad, then reframe it as a financial planning discussion for your future together. If you can demonstrate to your partner that what you’re really concerned about is the alignment of your future wishes and an honest conversation, then the topic will come around much more naturally. You may even decide that you agree with your state’s existing marriage property laws or decide that your assets are too small to need one. But in the end, it’s worth opening up the topic for discussion and coming to that conclusion together.