What you should know about prenuptial agreements
A prenuptial agreement, often known as a prenup, is a legal document that a couple creates before their marriage in order to determine how they want their assets to be divided in the event that they later decide to divorce.
Suppose you have a family inheritance that needs to be safeguarded. Your inheritance, whether it is real estate or the family business, should remain yours and yours alone during the course of the marriage. Having a prenuptial agreement can serve as a sort of insurance to assure this outcome.
In the weeks leading up to the wedding, when you’d rather be talking about honeymoon arrangements or debating whether or not it’s worthwhile to upgrade your wedding meal, it’s natural that bringing up the subject of divorce can be a delicate and sensitive matter to broach. Ivan Cheong, a partner in the divorce and family practice of Withers KhattarWong, said that it is necessary to protect yourself against the “acrimony, exorbitant legal expenses, and drawn-out court proceedings that would undoubtedly come from a disputed divorce.”
It seems that prenuptial agreements are becoming increasingly widespread. In a poll conducted in 2016 by the American Academy of Matrimonial Lawyers, it was found that 51% of divorce attorneys reported seeing an increase in the number of millennial clients requesting prenuptial agreements.
According to Cheong, there has been a general increase in the adoption of this practice in Singapore in recent years. He went on to say that this is the case notwithstanding the epidemic and the constraints it imposed, which led to a slender delay in the number of marriages that took place.
“I definitely observe increased enquiries for prenuptial agreements over the years,” said Johnson Loo, Director of Dispute Resolution at Drew & Napier LLC. “This is particularly the case where the parties come from richer families.”
“Women who are financially successful or stand to inherit from their family and/or will be involved in the running of their family business are more likely to do a prenuptial agreement,” said Cheong. “Women who will be involved in the running of their family business are also more likely to do a prenuptial agreement.”
Michael Han, Director of Hoh Law Corporation, said to CNA Women that it is comparable to a sort of wealth hedging. According to him, this is especially true for couples that marry later in life when each member of the marriage has amassed their own wealth or net worth on an individual basis.
Han also brought up the fact that there are situations when it is the woman’s or man’s parents who are the ones who want a prenuptial agreement set out in order to protect the family’s fortune. He related the story of a recent client visit in which a woman and her mother came to his office in search of a prenuptial agreement for the future bride.
He continued by saying, “When there is an income gap, the need for a prenuptial agreement increases for the reasons of preserving assets.”
In this article, family law specialists explain what a prenuptial agreement is, how one might go about obtaining one drawn up, and offer advice on how to broach the subject of a prenuptial agreement with one’s future spouse.
Han emphasized that you would need to make certain that your assets are held in separate accounts, and that there is no intermingling of cash, in order to guarantee the legality of the prenuptial agreement.
For instance, he suggested maintaining separate accounts and avoiding the usage of a joint account to pay for things like domestic bills and the schooling of the children.
And if you are interested in making investments, Han recommended that you use funds that originate from third-party sources, such as money or presents given to you by friends and relatives. He went on to say that in this manner, neither side would run the danger of accusing the other of utilizing their money for investing purposes.
The attorneys told CNA Women that it is dependent on the magnitude of the assets as well as the complexity of the situation. It can be as low as S$800 or as much as more than S$10,000. According to Loo, the more intricate the prenuptial agreement is, the longer it will take to create and, as a direct result of this, the greater the cost will be.
According to Cheong, you should refrain from doing so because the court is in the best position to decide what is in the child’s best interests during the divorce process.
“If a divorce is impending, it is preferable to record any arrangements relating to children in a postnuptial agreement,” he continued. “Documenting any arrangements relating to children in a postnuptial agreement is preferred.”
A postnuptial agreement, often known as a postnup, is a legally binding contract that can be entered into after a couple has already tied the knot. According to Cheong’s explanation, the timing of the divorce determines whether or not it would encompass arrangements involving the couple’s children from a previous marriage.