Why You Need a Prenup Even If You Don’t Have a Lot of MoneyPublished: Feb 14, 2018 in Divorce, Prenups
Written by Anthony Piccirilli
When discussing whether or not to have a prenup with your fiancé, do not fall into the trap of thinking it is all about a divorce. Having a prenup is not an assumption your marriage will end in a divorce. It is not evidence that you do not trust each other. Instead, a prenup is a sign that you and your fiancé want to have an honest discussion about your current finances, how you want to handle money during your marriage, and how you would want to protect one another in the future. An honest discussion about having a prenup and what it would look like for your relationship is a sign of a healthy partnership.
Reasons to Consider a Prenup
There are a number of reasons you and your soon-to-be spouse may want to consider a prenuptial agreement, including:
You might not have a clear picture of your fiancé’s income, savings, and debt. Your fiancé may not know about yours either. Drafting a prenup forces you both to be completely transparent with each other about how much you make, what you have (or lack) in long and short-term savings, and the debt you owe.
It also enables you both to come to understand the debts you may be liable for during the marriage and the debts that will remain your individual responsibilities.
Creating a prenup also forces you and your fiancé to discuss how you currently handle money, together and separately, and how you want to handle your finances during your marriage. Will you keep your incomes separate or have a joint account? Will your joint account hold all of your paychecks or a percentage of your earnings? How much will you save for a home, vacations, children, hobbies, retirement, and your other goals? Who will pay which bills? How will you use credit cards?
If you two have not had a thorough discussion about how you will handle money during your marriage, you should, whether or not you decide to have a prenup.
One or both of you may be confident that you will receive a sizeable inheritance someday, either from your grandparents or parents. It is a smart idea to talk about how you will handle this. Will an inheritance become entirely marital property and used for both your benefits? Or will one person’s inheritance remain their own and separate?
If one of you has a great deal of debt, such as from credit cards, or knows they will because of pursuing higher education, a prenup enables you to protect one another from debt. This document helps you deem certain debts as an individual’s sole responsibility. For instance, any financial aid you take out for law or medical school would remain your own, even if you took it out during the marriage. Or, if you have trouble with over spending on credit cards, you and your fiancé could state that you maintain your own credit cards and the balance is your own responsibility.
You will need to discuss divorce. This can include how you two would want to treat one another during the proceedings. You can control how you will handle certain financial issues. It can be difficult to predict how you would handle real estate when you may not own a home yet. However, you can lay out smart and well-rounded provisions regarding how you will make financial decisions during a divorce. In terms of practical decisions, you may outline terms for how you will handle joint responsibilities during a separation.
This discussion provides you two a chance to communicate regarding how you want to avoid going down that road. Though your conversation may not be about specific provisions in your prenup, you can talk about how you two want to handle big topics in the future, and whether or not you would ever consider marriage counseling.
Let a Prenup Attorney Help
When you and your fiancé have little-to-no money and assets, a prenup may seem unnecessary. However, there are many potential benefits to having a prenup and from going through all the discussions necessary to draft a prenup. Many couples find these talks bring them closer and create a stronger, more resilient relationship.