Prenuptial agreements often get a bad rap. Despite its significant benefits, only about 15 percent of married or engaged couples reported signing a prenuptial agreement in 2022.
Couples who inform their families and friends about their decision to sign a prenup are usually met with confusion and misunderstanding.
What are the common misconceptions surrounding this legal tool?
Prenuptial agreements are only for wealthy couples
High-asset couples are indeed more motivated to sign a prenuptial agreement, but anyone can draft one regardless of their net worth or socioeconomic status. Prenups document each future spouse’s assets, protecting them both from financial ruin should they file for a divorce. These agreements also offer a way to establish financial planning and responsibilities, enabling couples to establish security and clarity for the future.
Signing a prenup means planning for divorce
One of the most prevalent myths surrounding prenuptial agreements is that signing these is akin to planning for the marriage to fail.
On the contrary, couples who sign prenups seek to establish security and ensure they understand each other’s financial perspectives, even as significant life events happen down the line. Soon-to-be married couples can think of prenups like insurance – a financial planning tool they never hope to need but is there if the unexpected happens.
Prenups cannot be changed after signing
Couples can draft prenuptial agreements with flexibility in mind, which they can amend or revoke certain propositions at any time during the marriage, as long as there is consent from both parties. Major life events like having children or significant changes in financial status may warrant adjustments to the agreement.
Prenuptial agreements often draw unnecessary fear and hesitation due to various misconceptions. However, when properly understood, prenups are practical financial planning tools that can benefit couples of all backgrounds.
Signing such an agreement does not mean mistrust between two individuals on the cusp of married life. It simply means protecting one another from financial issues they could face down the road.
