Ideally, all couples looking to get married should at least engage in the process of getting a prenuptial agreement. As I’ve said before, negotiating a prenuptial agreement provides a very valuable opportunity for couples to discuss their mutual financial situations, their outlook on finances and their future goals.
I’m often surprised when I do estate planning for newly wed couples when I ask them about each other’s financial picture and they simply can’t tell me. They don’t know and they never bothered to have that conversation. Nearly half of all marriage eventually end in divorce and of those, most are driven by disagreements over money. If those are the statistics, then having a clear picture of each other’s current financial picture and also an understanding of each other’s goals and outlook on money is invaluable to keeping a marriage healthy and going strong.
Most couples however, only consider a prenuptial agreement with one or both have significant assets. This is of course a wise thing to do. However, couples on the other side of the spectrum, those with lots of debt, should also consider a prenup. Debt incurred in a sole person’s name is generally regarded as that person’s debt alone. But when couples get married, finances are mixed and sole debt starts to become marital debt. At some point, there’s little or no way to distinguish what was sole debt and what is marital debt. Bottom line: If you have a large amount of debt, get a prenuptial agreement to protect your future spouse.