Prenuptial Agreement

May 2016


The other day I read an article about a woman who balked at signing her prenuptial agreement and as a result, she decided to not get married. Since she had already paid for the reception, she decided to throw a party for the homeless. Obviously, this is someone who knows how to make the best out of a bad situation. I admire her for that; but in addition, I also admire her for refusing to sign a legal document she was not comfortable with. Unfortunately, too many people end up signing legal documents they’re not comfortable with and as a result, they pay for it in the long run.

Unfortunately, there is still somewhat of a stigma with regard to prenuptial agreements and I believe there shouldn’t be. Many people believe you get married for love and therefore shouldn’t need a prenuptial agreement. That would be true if we all lived in Ozzie and Harriet families, but we don’t. In today’s complex world where blended families seem to be the norm, a prenuptial agreement can be an invaluable document to protect you and your family.

It is important to recognize what a prenuptial agreement is meant to accomplish. Generally, a prenuptial agreement will address two issues. The first and the one that most people are familiar with is what happens when the marriage does not work. As opposed to spending years in court and spending substantial amounts of money on divorce attorneys, a prenuptial agreement sets forth terms if the marriage does not work. For a young couple with very little in assets, a prenuptial agreement may not be necessary. On the other hand, if someone is coming into the marriage with substantial assets they’re looking at protecting, a prenuptial agreement can be effective. For example, through the effective use of a prenuptial, a small business owner can protect the business if there is a divorce.

Another effective use of prenuptial agreements is to protect assets or an individual upon your death. Many people think prenuptial agreements are only effective in divorce situations; but, that is not the case. Prenuptial agreements are also used to protect children from a previous marriage. For example, upon your death, you may want to have your assets go to the children of your first marriage without leaving anything to your new spouse. One of the most effective ways of accomplishing this is through a prenuptial agreement. My philosophy is that when someone gets married and they have substantial assets or they have children from a previous relationship they want to protect, a prenuptial agreement is effective to protect the parties and make sure that judges, courts and lawyers don’t get involved with family affairs.

One of the mistakes people make with regard to a prenuptial agreement is they wait until the last second, and as a result, it causes all sorts of problems. My advice is that you can’t wait until the last second and the sooner you can put it behind you, the better it is. After all if you can’t discuss something as uncomfortable as a pre-nup, maybe it’s a sign you should not be getting married.

I recognize the reason people get married and should get married is because they love each other. However, we all have to accept the reality that even though couples may love each other that does not mean the marriage will necessarily work. A prenuptial agreement is the mature way to ensure if a relationship does not work, there is an orderly and systematic distribution of the property so that both parties can move forward without destroying each other in divorce proceedings.

Good luck!
Rick is a fee-only financial advisor. His website is If you would like Rick to respond to your questions, please email Rick at