Prenups: Who Needs Them?

5 min read

Prenups: Who Needs Them?

Prenuptial agreements aren't just for the rich or famous. Almost every couple considering marriage or entering into a marital union should consider getting a prenup — even if they aren't high-earners. Love is blind, but prenups aren't! Today, we will explain why they are essential to every couple.

A prenuptial agreement can save you time and money in the event of a divorce. This document, often known as a prenup, outlines how your assets and debts would be divided in the event of a failed marriage. It can also outline terms for income and alimony agreements. Rarely do engaged couples want to consider the possibility of divorce. Even if divorce rates have declined in recent years, it is a reality that roughly half of all marriages end in divorce. Preparation for the worst-case situation is essential in all aspects of life. The same applies to marriage.

What is a Prenup?

A prenuptial agreement establishes what happens to each spouse's property and money if the marriage ends in divorce. Prenuptial agreements are similar to estate planning. You write a will to leave items to your children or heirs, ensuring that each person receives something meaningful. A prenuptial agreement specifies who gets what if you divorce.

A prenuptial agreement takes into account the end of the marriage so that assets can be split in a fair way. It can even help safeguard your business. With a prenuptial agreement, you can determine if spousal support (also called "alimony") will be needed if the marriage ends, as well as how much and for how long. They can also influence the types of bequests you leave to each other in your wills.

Prenuptial agreements are also known as:

- Antenuptial agreement

- Premarital agreement

- Prenuptial contract

No matter what you call it, a prenup tells each person what their rights are if the marriage ends. This may sound unpleasant now, but it can save you a lot of heartache and money in the long run.

Should I Get a Prenup?

If you are wondering, "Do I need a prenup?" You probably do. The potential value of a prenuptial agreement may be worth any initial discomfort. Prenups are seen more and more as a way to help couples trust each other and talk openly about money.

Prenups are especially helpful for couples who want to keep important personal assets like future inheritances and other expected income in their own names. This motivation is prevalent among couples with a significant age or wealth gap, as well as older or remarried individuals. Prenups can be particularly crucial if a couple enters marriage with a few of these issues to resolve because their circumstances may drastically change. In fact, some of the best candidates for a prenup are couples who still have the majority of their lifetime assets and liabilities ahead of them.

How Much Does a Prenuptial Agreement Cost?

The cost of a prenuptial agreement can vary widely depending on the state, the attorney, and the intricacy of the case.

In certain straightforward cases, the cost could be as low as $500. In other instances, a prenuptial agreement can cost between $2,000 and $6,000 per individual. The national average cost of a prenuptial agreement is $650. In California, the average cost of a prenuptial agreement is $975.00. The cost depends on how complicated the agreement is, how organized the parties are, and how willing the other lawyer is to work with you.

Prenups Aren't Just for the Rich

While prenups are most commonly used by extremely wealthy people to protect familial assets or wealth earned before marriage, they can be useful for almost anyone. Even low-income couples can benefit from a prenup. Some people are concerned that drafting a prenuptial agreement will increase the likelihood of their divorce. If your relationship can't withstand financial planning before marriage, it's unlikely to withstand the financial challenges that marriage brings.

Protect Family Heirlooms

To be clear, your prenuptial agreement does not have to account for every asset and item you own, as well as every divorce scenario. A prenuptial agreement can be made for a single purpose. If you inherited a family heirloom and want to ensure that if your marriage ends, you can draft a prenuptial agreement stating that the family heirloom is yours. The prenup can also state that items inherited during the marriage will be treated as separate property.

Transfer Property to Children from Prior Marriages

Prenups are often used to establish property rights in second marriages. If you have children from a previous marriage, you may want to protect their rights to your assets and property. You can use a prenup to specify what property should be kept separate from the marriage, protecting that property if the marriage ends. When combined with proper estate planning, you can ensure that pre-marital property goes where you want it to go.

Establish Financial Rights

Prenuptial agreements are specifically for financial matters. Whether you come into the marriage with substantial assets or very few, you can decide how assets will be divided now rather than waiting until divorce proceedings. While divorce may never occur, determining financial distribution now saves time and headaches later. Consider the split now, and hope you never need to rely on your prenuptial agreement.

Debt Protection

Prenups also protect against debt, which goes hand in hand with clarifying financial rights. Some people enter marriage with significant financial or student loan debt. Couples in this situation can enter into a prenup and specify that the debts are the sole responsibility of the spouse who incurred them. They can also decide how to handle debts incurred during the marriage. Finances can cause enormous problems in a divorce, and resolving them now can be beneficial and cost-effective.

Avoid Emotional Arguments

Divorce is emotional. Even if you know it's the right decision, the process can be overwhelming and upsetting. When you're negotiating who gets what with your spouse, emotions can run high and cloud your judgment about asset distribution. Everyone benefits from considering these issues with a clearer mind.

How to Get a Prenuptial Agreement?

You can have attorneys and/or financial advisors negotiate and draft a prenup, or you and your spouse can create your own.

How to Draft Your Own Prenup

It is not advisable to draft your own prenuptial agreement or any legal document. There are complex state laws that must be followed when drafting and signing a prenup. There are several factors to consider when creating your own prenup. Keep in mind that any prenuptial agreement you create will still require the review of a lawyer. You will need a legal advocate to protect your rights and ensure that the contract is legally binding in your state.

Making Your Prenup Valid

Prenuptial agreements are becoming more common, and courts are scrutinizing them less than in the past. So, if you write your own, make sure you understand what you're signing. Keep it simple when writing your prenup. Don't write it in legalese and make it complicated. This will cause a court to question its legality. Most states do not allow the agreement to be signed immediately before the wedding because it can create coercion.

To be valid, most states require both parties to have their own lawyer review the document. Never sign a prenuptial agreement without first understanding your rights and ensuring that the agreement is legally binding. Make certain that both parties sign the prenup. In some states, you may also be required to sign in front of a notary public, who will ensure that no one is signing under duress.

Prenuptial Agreement Terms

Your prenup should address both financial and property rights. To be completely transparent, you must exchange accurate financial information and disclose all of your assets and debts.

Most prenups include a clause stating that both parties have been open and honest. If it is discovered that either party was not, the agreement will most likely be void. A prenup cannot be used to entice someone to marry you. Prenups cannot provide someone with cash, assets, or other items as "payment" for entering into a marriage.

What Happens If You Don't Sign a Prenuptial Agreement?

If you get married without a prenuptial agreement and then get a divorce, it could be disastrous for your finances. There's an old adage that says you can spend some money now or more money later. We can all agree that it is better to spend less money now. Your state's laws govern how your marital assets and debts are divided if you divorce. There are two types of states: community property states and equitable distribution states.

Community property

Courts begin with the assumption that marital assets and debts will be divided equally. (50/50) 

Equitable distribution

Courts divide marital assets and debts fairly, though not always 50/50.

Source: Vincere Wealth

The majority of the assets acquired during your marriage will be considered marital property. This implies that they are available for distribution. Marital property could include:

- Income

- Retirement accounts

- Inheritance (sometimes excluded)

- Household furnishings

- Homes

- Bank accounts

- Jewelry and watches

- Investments

- Cars

- Boats

If you don't sign a prenup, you'll have to figure out how to distribute all of these items (or have the court do it for you) while also adjusting to being single. This is overwhelming for many people. You can avoid this headache by drafting a prenuptial agreement.


I strongly encourage anyone who is planning to get married to consider a prenuptial agreement. I like to think of prenuptial agreements as an insurance policy on a marriage. While you always hope that you won't have to make use of your insurance policies, it is essential to have them in place to protect both you and your assets in the event of a divorce or other legal dispute. There is no question that prenuptial agreements have a reputation for being frowned upon. But what I think a lot of people don't realize about them is that they are actually there to provide protection to both partners, not just the higher earner. 

In some states, alimony agreements can be written into a prenuptial agreement to protect the income of a stay-at-home parent in the event of a divorce. You can legally hold an ex-spouse to this agreement if they were to drag your name through the mud online, for example. You can also put in clauses that protect your pets and even embryos if you ever go that route. 

One of the interesting aspects of today's world of prenuptial agreements is the ability to add a social media agreement. And if you have a partner but aren't married and don't have any plans to get married, but you already live together or plan to start living together in the near future, this also applies to you. Think about signing a cohabitation agreement with the person you want to live with. This is very much like a prenuptial agreement, but it is for people who are not getting married. You are able to enter into a postnuptial agreement even if you did not sign a prenuptial agreement prior to getting married.

Frequently Asked Questions (FAQs)

Do I really need a prenup?

A prenuptial agreement is a good idea for anyone entering into a marriage, regardless of wealth. Thinking about the end of your marriage before it begins may seem counterintuitive, but it saves you time and money later on.

A prenuptial agreement specifies how assets will be divided if the marriage fails. You write it all down in your prenup, file it away, and hope you never have to look at it again. If you do, it will be there for you to use.

Can you write your own prenup?

Yes, but it's usually not a good idea. A couple is free to draft their own prenuptial agreement, but a court can reject it if it is invalid in any way.

What should I include in my prenup?

That is a highly individual question. It is entirely up to you and your fiancé, with the exception of a few items that cannot be included—more on that later. In general, the following items are commonly included in a prenup:

- Clarifying which property or assets are separate and which are marital property

- How debts will be divided

- Property protection for children

- Heirlooms and inheritance

- Estate planning considerations

- Property distribution upon divorce

- Considerations when one or both spouses own a business

- Spousal support

In the end, it's up to you and your fiancé to decide what to put in your prenup. If you want to protect special things, it's a good idea to have a lawyer look over your prenup to make sure you've done enough to protect them and won't have more problems down the road.

What cannot be included in a prenup?

You cannot enter into a contract for something that is unlawful. This could actually render the entire agreement null and void. In most states, a prenup cannot address child support or child custody. Those decisions are made by the courts using the standard of the child's best interests.

In addition, prenuptial agreements cannot specify who will perform which chores, where you will spend the holidays, information about your children, or any other personal details. A prenuptial agreement is used exclusively for financial and financial-related issues.

What if we are already married?

Enter the postnuptial agreement. A postnuptial agreement is similar to a prenuptial agreement, except that it is signed after marriage. Not all states allow postnuptial agreements, so check your state's laws first.

Where allowed by law, the only significant distinction between a prenup and a postnup is when the contract is signed. A postnuptial agreement resolves the same issues. If you did not want to write a prenuptial agreement or if you did but later decided to agree to different terms, you can use a postnup.

I hope this information was helpful. If you have any questions, feel free to reach out. I’d be happy to chat with you. 

Connect with Jen

About the Author

As a Divorce Financial Analyst and Wealth Advisor here at Vincere Wealth, Jen helps clients navigate their financial challenges and decisions that a divorce can present. Having someone guide you today in making sound financial decisions can have a significant impact on your financial well-being in the future. Jen takes great pride in guiding clients through the complexities of student loans, retirement planning, and marriage and divorce planning.

If you're interested in an investment advisory or financial planning relationship, please consider Vincere Wealth Management.

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Prenups: Who Needs Them?

Prenuptial agreements aren't just for the rich or famous. Almost every couple considering marriage or entering into a marital union should consider getting a prenup — even if they aren't high-earners. Love is blind, but prenups aren't! Today, we will explain why they are essential to every couple.

Prenups: Who Needs Them?

Prenuptial agreements aren't just for the rich or famous. Almost every couple considering marriage or entering into a marital union should consider getting a prenup — even if they aren't high-earners. Love is blind, but prenups aren't! Today, we will explain why they are essential to every couple.

Prenups: Who Needs Them?

Prenuptial agreements aren't just for the rich or famous. Almost every couple considering marriage or entering into a marital union should consider getting a prenup — even if they aren't high-earners. Love is blind, but prenups aren't! Today, we will explain why they are essential to every couple.

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