You may know especially if you have been married before, that your assets and income will become joint property when you get married, even if they are held in one person’s name.
So it’s important to think about how you want your assets to be dealt with should your marriage end or how you want to protect any assets that you acquired from a previous divorce.
Prenuptial and postnuptial agreements can prevent hostility and arguments between you if your relationship comes to an end, which means the entire divorce process can be much quicker and smoother.
A prenuptial agreement is a written contract prepared before your wedding that outlines what will happen to your finances if you ever divorce. Here’s what you need to know:
- You’ll each need to take independent legal advice to make sure you both understand how the prenup works and the implications of what you’ve signed.
- You should start drafting your prenup at least 28 days before your wedding so you have time to negotiate and sign the agreement, which will be effective as soon as it is signed. If a prenup is left until the last minute, the Court may not accept it on the basis it was rushed into or because there is a risk it was entered into under duress.
- It’s a good idea to include review clauses so that from time to time you can review the agreement and amend if needed to keep it up to date with your financial situation.
Although prenups are not legally binding, if your marriage breaks down the Court will look at your prenup and if it is fair and reasonable the terms of the prenup can be turned into a Financial Order.
If the prenup is not fair and reasonable based on your circumstances at the time of your divorce, the Court may need to be reconsider the division of assets that was agreed. But with later life divorce, a prenup might work well if you don’t expect your financial situation or income to change too much from when you got married.
You can prepare a postnup any time after getting married. In the same way as a prenup, the postnup will outline what you and your partner want to happen to your finances should your marriage break down. Again, you will both need to take independent legal advice and isn’t legally binding.
A postnup could benefit you if you have assets that you owned before or after getting married that you want to protect or your circumstances have changed since you signed your prenup.
Living Together as an Unmarried Couple
It’s important to understand that if you don’t get married you won’t have the same rights as a married couple. This means that any assets in your sole name, such as savings and pensions, will remain yours even if your relationship ends.
And if you’re not married or in a civil partnership, you won’t automatically inherit each other’s estates when one of you dies. So you should think about writing a Will or amending an existing Will if you wish to leave anything to your partner.
You can also get a cohabitation agreement if you decide to live with a partner rather than getting married in later life, which will set out what happens if you separate and how your assets will be divided.