Should Your Wedding Plans Include A Pre-Nuptial Agreement?
In the excitement of planning your wedding it may be difficult to envisage any circumstances in which you and your intended may separate. However, the emotional and financial cost of lengthy court proceedings to determine how assets should be shared on divorce should not be underestimated. At an already difficult time there may be uncertainty as to the end result as there is no magic formula to predict who should get what; the Court will start with the premise that matrimonial assets should be divided equally, but in reality it may not be clear which assets should be put into the matrimonial pot and there are a number of factors which may lead the court to depart from equality.
A pre-nuptial agreement (or pre-nup as they are commonly referred to) allows both parties to the marriage the opportunity to consider how they would expect assets and income to be treated if they were later to divorce and to set out agreements reached in a formal document with a view to giving both parties certainty and security.
A person who brings personal wealth or business interests to a marriage can benefit enormously from a properly prepared pre-nuptial agreement, particularly as the Courts have shown an increased willingness over the last few years to uphold such agreements. It is now the stated position that “the Court should give effect to a nuptial agreement that is freely entered into by each party with a full appreciation of its implications unless in the circumstances prevailing it would not be fair to hold the parties to their agreement”.
A pre-nup can be particularly useful to:
- Protect the interests of children from a previous marriage by ring-fencing assets.
- Protect inherited assets, including a family business
- Enable parents or other family members to make lifetime gifts for tax planning purposes without those assets falling into the matrimonial pot
- Protect interests arising under a Trust
- Protect business interests
Finally, it is worth noting that nuptial agreements can still be entered into after marriage ( when they are known as post-nuptial agreements). I will cover this another time. For now it is important to remember that you must seek expert legal advice when it comes to matrimonial matters of any kind.
My advice is "Yes .. your wedding plans should include a pre-nuptial agreement"
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