Why Are More Millennials Signing Prenups?
Carlsbad, CA – Prenuptial agreements are becoming more common among millennials who tie the knot, according to a survey of matrimonial lawyers.
Real estate and alimony often are the key issues these couples are negotiating. Experts have identified several factors that play into this important legal document.
Unlike previous generations, millennials are putting off marriage until they’re older, which means many of them have built up considerable assets by the time they choose to marry, according to a recent New York Times article. They don’t want to lose those assets so easily should their marriage end in divorce.
Alton Abramowitz, a former president of the American Academy of Matrimonial Lawyers, had this to say in 2013 after the academy released a survey that found that 63 percent of divorce attorneys reported seeing an increase in prenups, and 46 percent noted an increase in the number of women initiating requests for prenups:
“As the financial and real estate markets continue to improve, there is a greater awareness of risk to possibly sharing these gains in a divorce. The trend of divorcing spouses fighting over which one has to take possession of a devalued home and other depreciated assets appears to be coming to an end.”
In addition to increasing their assets, millennials also have had time to build up more debt on their own, and a marrying spouse may seek a prenuptial agreement to protect themselves from becoming responsible for a portion of that debt in the unfortunate event of divorce.
Another factor that could be a driver for the increase in prenup requests is that more women are in the workforce today that in previous generations. In 1980, 13 percent of women who lived with a man brought in half or more of the couple’s income, the NYT article stated. Today, that number has increased by nearly three times.
We live in an age where more people than ever seem to have a “side hustle” that they turn into a full-time job. A prenup is worth considering if you own a business.
“Start-ups are even more important to protect because the seed was most likely planted prior to the marriage but the significant growth will take place during the marriage,” according to a Bustle article about the millennial/prenup phenomenon. “Without an agreement dictating otherwise, the separate property nature of the business would be valued at the date of the marriage when it was low but the growth during the marriage would be all marital, which may not be fair to the person who created the idea prior to getting hitched.”
It’s also worth considering that more than a third of millennials are the product of single parent households, whether it’s because their parents never married, or because the relationship ended. Some financial professionals suspect that this has made millennials more realistic about marriage and more willing to consider that their marriage may not be for life.
Following are common circumstances in which couples choose to put prenuptial agreements in place, the NYT article stated:
- One or both of you own real property or a business
- There are children from a previous marriage or relationship
- You plan to take a break from work while you raise a family
- You have a considerable amount of debt
- You have a sizeable retirement account and you wish to protect the compounding growth
- You will receive stock options during the marriage
If you are interested in exploring prenuptial agreements to determine whether you should have one in place before you marry, please call our office for a consultation. We are happy to help.
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