Despite media perception, nuptial agreements are by no means exclusive to the ultra rich and famous. Increasingly people are choosing to enter into them – either before they get married (a pre-nuptial agreement), or after the big day (a post-nuptial agreement).
For example, someone marrying for the first time whose parents have helped to buy their property and they are likely to inherit more funds in the future, may want to protect those gifts – whether for their own benefit or for their future children. It’s very possible that without a nuptial agreement, the Family Court will view any such gifts and inheritances as marital assets to be shared with their spouse.
Likewise, older couples that are remarrying following a previous relationship, may want to retain clarity over how their assets will be owned in order to bring peace of mind to their adult children and protect future inheritances.
Nuptial agreements are not binding on the Family Courts of England and Wales but they are highly persuasive if they satisfy some core criteria, the most important of which are that:
- Neither party was forced into signing the agreement
- Both parties understood the terms and their effect
- And most importantly, the terms remain fair meaning that they meet each of the parties’ needs, and the needs of any dependent children of the family
In order to evidence that the core criteria has been met, the contract does need to be fairly detailed, independent legal advice obtained by both parties separately, and financial disclosure exchanged. However, the provisions on separation can be as narrow or wide ranging as people wish. A nuptial agreement could simply specify assets that are to be kept separate from marital finances and remain the sole property of one of the parties, or it could go further and explain how the financially stronger party will support the other person if they separate – such as buying the other person a home mortgage free, paying them a monthly amount to help meet their living expenses, and transferring some of their pension fund. In this way, and since a nuptial agreement has to meet people’s needs to be upheld anyway, a nuptial agreement shouldn’t be viewed as an unromantic and mercenary exercise. It can be a very positive means for both people to a marriage to achieve security in knowing that they are marrying for the right reasons, and for the financially weaker party to guarantee that if the worst comes to the worst, they will be looked after without having to endure a costly legal battle to get that financial support.
So if you think a nuptial agreement could be right for your situation, how do you raise this subject with someone you love and trust implicitly? Well just in the same way that you would prepare a will, lasting powers of attorney and buy life insurance, a nuptial agreement is there to provide clarity and make big decisions in advance for one of life’s darkest times. Chances are that once your nuptial agreement is signed and filed somewhere safe, you’ll never need to rely on it and will only need to dig it out occasionally to make sure the terms remain fair to you both. So doesn’t it make sense to make big life decisions when you love and respect the other person, are well rested and have clarity – rather than when you are potentially overwhelmed by emotion and stress?