A recent report from Business Insider states prenuptial agreements are on the rise.
A quick and brief refresh: What is a prenuptial agreement?
Prenuptial agreements, often referred to as simply a “prenup,” is a legal document that outlines the distribution of assets in the event of a divorce. Both parties generally sign the document prior to the marriage. Each party is wise to have the document carefully reviewed by their own legal counsel. Legal review is important to better ensure each party’s interests are represented and mitigate the risk of any surprises in the future.
Data finds a jump in prenups in recent years: What is the cause?
The Business Insider report comes after a study by the American Academy of Matrimonial Lawyers found 62% of attorneys reported an increase in requests for prenuptial agreement. The group with the study found over half of the attorneys who partook in the survey stated their millennial clients were most likely to request a prenup.
Increased divorce rates amongst baby boomers may play a role in the jump in prenuptial agreements. Perhaps the millennial generation is more likely to have experienced a divorce within their family and is aware of the issues that can arise without a prenuptial agreement. Other potential reasons include:
- Professional couples. Today, there is an increased likelihood both parties to the marriage are in the workforce. As a result, each party will have accumulated assets prior to the marriage and will likely be interested in protecting these assets.
- Less stigma. The public views prenuptial agreements differently than it once did. In the past, these legal documents were generally viewed negatively. People are now more informed about the benefits of these documents and more inclined to consider including one within their wedding plans.
It is important to note that there are limitations to what a prenuptial agreement can cover. It can generally account for most assets but is unlikely to be able to control issues like child custody. The couple must also follow proper legal protocol when putting together a prenuptial agreement to better ensure it will survive any potential legal challenge in the future.