We’re all familiar with the stereotype of a wealthy person marrying someone with considerably fewer assets and the family insisting on a prenuptial agreement to protect the family’s fortune. Or, there is the other scenario where one party is heartbroken because they believe their fiance doesn’t trust them and is dooming the marriage before it even begins.
In truth, a prenuptial agreement isn’t just for rich people. Instead, it is a symbol of love and respect, and every couple should consider signing one before saying “I do.”
An open and honest conversation
A prenuptial agreement encourages transparency between a couple. One of the key factors in many divorces is disagreements over finances. By discussing assets, debts and financial goals openly and honestly, couples can avoid surprises later on. These dialogues can strengthen a relationship.
A prenup can help protect any assets you may have, such as a nest egg for retirement or a down payment on a home, a condo or house you purchased before you met or a business you’ve built. Instead of pre-planning the end of a marriage, a prenuptial agreement creates clarity and defines what each person brought into the marriage and what will happen to those assets if things don’t work out as planned.
It can also address pre-existing debt. One partner may have paid for college by working and saving money, while the other took out student loans. The prenuptial agreement allows both parties to outline who is responsible for what. If one partner has credit card debt or has taken out a business loan, the agreement ensures those financial obligations stay separate.
Prenuptial agreements can provide peace of mind for the couple’s families. If there are heirlooms, a significant inheritance or a family business, everyone can have the assurance that what’s already in the family stays in the family.
A marriage is more than just two hearts joining together. It’s also a legal and financial partnership. A prenuptial agreement is just another tool to help foster mutual understanding.
