A prenuptial agreement often referred to as a premarital agreement or simply shortened to prenup, is a legally binding agreement. Before a couple gets married, they decide how their assets and/or income will be allocated should they get separated, divorced, or one or both passes away.
Prenuptial agreements can be frowned upon because some view them as creating a lack of trust in your relationship or that you’re just “preparing to fail.” Others see it as a way to protect the wealth that they’ve accumulated and have worked hard for. No matter the reasoning behind the prenup, negotiating a prenup that’s fair for both sides can be complicated.
Rebecca Zung—a notable divorce attorney—spoke about negotiating through a divorce with a narcissist in episode 163 of the Negotiations Ninja podcast. But she also shares what you must think through on the front-end of a marriage: how to negotiate a prenuptial agreement.
Negotiating a prenuptial agreement 101
Is a prenup important? Rebecca believes they can be wonderful—but only if they’re fair. Rebecca points out that if you’re the person without the money, a prenuptial can force you to sign away a lot of things that you should be owed.
Think about it: If you’re signing this agreement at 35 and 20 years later you’re divorced and trying to start your life over, it can be detrimental. You’re stuck with potentially no skills and no work history and have to try and figure out how to make money and rebuild your life. It can be pretty brutal and people don’t always understand what they’re doing.
Rebecca shares “If I’m representing the non-money spouse, I tend to try to look ahead and go, ‘Okay, what would they have gotten in 10 years? What would they have gotten in 20? What would they have gotten in 30?’” Use those numbers as benchmarks. If they are going to get divorced, make sure the moneyed spouse can provide something for the non-moneyed spouse to live on while they get their footing back.
Negotiating a prenup for the spouse with all the money
If Rebecca is protecting the moneyed spouse and helping them craft a prenuptial agreement, the job is to protect that moneyed spouse’s resources. It’s usually wealth that was accumulated before the marriage. Or it’s a family-owned business that they want to make sure goes to their children or stays within the family should the worst happen.
Rebecca notes that she also negotiates prenups for older couples who have been widowed or divorced. Most often, they want to keep their money separate so their children get inheritances. So they spell out the plan for a joint home, finances, and vacations.
The caveat is that every state has provisions where premarital agreements around children aren’t upheld. Why? Because you can’t predetermine what will be in the best interests of the children before you get divorced—or before you even have kids.
Having conversations about how your money and assets will be allocated should the worst happen can actually benefit your marriage. You’ll both know that if the marriage comes to an unexpected end, things have already been negotiated. In some ways, this can save you from a lengthy, nasty divorce.
To learn more about negotiating a divorce the right way, listen to episode 163 of the Negotiations Ninja podcast. Rebecca Zung shares some amazing insight into the process that can help you navigate a divorce with as little pain as possible.