Pre-nuptial agreements, referred to as marriage contracts in Canada, are always a good idea. Should a married couple decide to separate, the agreement provides instructions as to how to deal with property or assets, support obligations between spouses, debts, and much more. Because agreements are negotiated at a time when future spouses are happy and have a positive outlook on life, they are more likely to represent a fair unwinding of each party’s affairs in the event that the marriage breaks down.
While these contracts offer numerous benefits, they were at one time frowned upon because they were associated with greed or distrust. But, it appears that things have changed, and more couples, especially those in their 20s and 30s, are warming up to the idea of signing a pre-nup before they say “I do.”
Here are some of the top reasons why soon-to-be-married couples are getting pre-nups (and why you may want to consider getting one if you’re planning to get married).
Millennials are choosing to make big sacrifices for career advancement, reports a survey from Wakefield Research, and that includes delaying marriage in order to be able to travel for work. As such, some of these hard workers are bringing significant assets, investments, and even property into their marriage, and they want to ensure they don’t risk losing those assets should their relationship end.
In contrast to the above point, last year CIBC found that about 2/3 of Canadian couples enter into a common law relationship, or marriage, in debt. And like assets, debts can influence how much one spouse may owe the other if they decide to end their marriage. Should one person have significantly more debt, say from a student loan, a pre-nup can be the simplest way to ensure the spouse with little or no debt doesn’t experience financial hardship because of the other spouse’s debt. See what our lawyer Diana Isaac had to say about pre-nups and debt when she was invited to lead a discussion on Newstalk 1010.
Some parents have plans to pass on a significant asset, such as a family business, to their child or children, while others intend to give their kids a large monetary gift. Canadian parents are expected to gift approximately $24,000 to each adult child, but those earning more than $100,000 a year say they plan to give $40,558. Parents may encourage their children to get a pre-nup because they want to ensure that the money or assets remain in the family should their child get divorced. Learn more about how to protect valuable family assets by downloading our free Inheritance Protection Guide.
Pre-nups aren’t just for the wealthy. They can be useful to almost every couple who has plans to get married. Having one will not increase your chances of a getting a divorce, but it will help minimize conflict and animosity should you decide to end your marriage.
Are you interested in getting a pre-nup? Or have you been asked to sign one? Come speak to one of our family law lawyers first. Our consultations are free, thorough, and confidential.