In a recent entry on her blog, divorce adviser, attorney and coach, Karen Covy breaks down the nitty gritty details of the elephant in the room in so many relationships headed toward marriage: Prenups.
Covy tackles the subject so often talked about in the context of celebrity couples, demystifying the finer points of prenups with a practical approach. Acknowledging that prenups are a taboo subject, the ins and outs of a marital contract are viewed with an eye toward the average couple, no matter the assets of either partner.
And while Covy makes light of the fact that a prenup is “about as romantic as a root canal,” she cites a dramatic uptick in the prevalence (and presumably the societal acceptance) of putting pen to paper before saying “I do!” Indeed, The American Academy of Matrimonial Lawyers polled attorneys, found a 51% increase “in the number of millennials seeking prenuptial agreements in the past three years.” Additionally, 62% of the lawyers surveyed reported a rise in the overall number of prenups.
Covy’s article is a sort of “how to” for couples wondering if a prenuptial agreement is right for them, and covers both the basic concepts of marital contracts, as well as the minutiae — after all, the devil’s in the details.
First, Covy explains what a prenup is in broad strokes. In short, a prenup is simply a legally binding contracts that stipulates what happens when a marriage ends (either in divorce or in the death of one partner). And as with any contract, nothing is set in stone, and the particular circumstances of a couple’s union can be incorporated into a prenup in a way that best serves them. In other words, prenups are not one size fits all.
Next, the specifics — both the economic and the everyday stuff of life — are unpacked. Covy points out that the majority of prenuptial agreements are concerned with finances. However, she also makes clear that any number of factors, choices and expectations can be baked into a contract, from how frequently partners have sex, to how often a spouse is responsible for cooking, cleaning or taking care of household chores.
What are the limitations of a prenup?
But in spite of the seemingly endless number of issues in a marriage that can be governed by a prenup, Covy also points out a handful of limitations. And while the laws around prenups are different from state to state, there are a few keys areas that are out of bounds. Most notably, prenups cannot govern child custody in the event of a divorce, nor can they limit alimony or child support in the event of the dissolution of a marriage. And while it may seem obvious, one fact holds true no matter what state a couple calls home: a prenuptial agreement can not include any provisions that require a spouse to engage in illegal activity.
Some experts believe that prenuptial agreements lead to breakups because they promote defensiveness, but others feel they encourage honest discussion about finances. In my case, my second husband Craig and I had fairly similar incomes and assets when we were engaged, so we decided not to draw up a prenuptial agreement before we got married. However, we met with an attorney and established a trust for my two children from my first marriage that included provisions for all three of our children in the event that I die before Craig. I felt that establishing an estate plan would provide for Craig, ensure that my assets be distributed fairly among our three children.
Prenups and Remarriage
On the other hand, there are plenty of scenarios where a couple entering a remarriage might want to consider a prenuptial agreement. It can protect a more affluent partner when a couple has unequal assets, retirement funds, homes, and sometimes children from a prior marriage. It can also give people greater peace of mind if they were victims of financial infidelity in their first marriage or have concerns about having funds for retirement.
Most people considering marriage, whether the first, second, or third one, shy away from making a prenuptial agreement. The very thought of them raises trust issues and can lead to explosive conversations. However, when people remarry later in life, many concerns arise that could be addressed in a prenuptial agreement. They include supporting each other through retirement and old age, leaving assets to children, stepchildren, and “mutual children” if the marriage is ongoing at the time of death, and ensuing a peaceful divorce if the remarriage fails. Further, a prenuptial agreement can be a vehicle to help you decide how to support yourselves during the remarriage and to make mutual decisions about finances that feel fair to both of you.
Discuss Money Issues Prior to Hiring a Lawyer
Finally, Covy walks couples through the steps of actually taking the plunge and entering into a prenup. Offering sensible advice that may not be obvious to most people, she points out that while both partners need a lawyer to negotiate, craft and execute an effective prenup, couples should not start the process by hiring their own attorneys.
Hiring lawyers from the start can spell disaster for many couples considering marriage, and Covy rightly suggests that the process should start with an honest conversation about the values, expectations intentions and goals of the couple. She writes: “A prenup is an agreement between two people in a relationship. It is about money. Money is a sensitive topic. Money means different things to different people.” Further, she explains that talking through the myriad of tough issues that will ultimately be covered in a prenup is a surefire barometer on the state — and long-term prospects — of a relationship
In other words, if a couple can talk through the uncertainty and anxiety that makes a prenup attractive in the first place, they will be much more likely to come to an understanding informed by both practicality and love.
Covy also breaks down the small but crucial legal requirements that make a prenups binding (namely that it must be in writing, signed by both partners, and include a full and transparent accounting of all pre-marital assets), before ending with a helpful list of “pros and cons” that all couples should consider.
Transparency Often Prevents Divorce
Whether or not you choose to have a prenup, I highly recommend openly discussing the details of your past and current finances. In my experience, transparency often prevents divorce, and it’s certainly better to know if you will have trouble discussing finances prior to marriage rather than after the complications of living together set in.
Ultimately, it boils down to this. Finances are essential to every aspect of your life and discussing them openly provides you and your partner the best opportunity for building the foundation of a strong marriage. In the end, it’s clear that prenups and their prevalence are reflective of the times, and their increasing acceptance in the culture has both positive and negative ramifications. Either way, as with any major decision in a marriage, prenups should be approached with openness and honesty by couples, and despite the best intentions and the most skillful legalese, a prenup is not going to ensure success in a relationship. It may be one piece of the pie, but long-lasting love and marriage that stands the test of time, requires good old-fashioned communication, compromise and caring.
Follow Terry Gaspard on Twitter, Facebook, and movingpastdivorce.com. Her book Daughters of Divorce: Overcome the Legacy of Your Parents’ Breakup and Enjoy a Happy, Long-Lasting Relationship is available on her website.
Terry’s forthcoming book, The Remarriage Manual: How to Make Everything Work Better the Second Time Around, will be published by Sounds True in February of 2020.