As part of the Tatler SOS Experts’ Corner, we delve into the subject of legal arrangements surrounding relationships. Here, Julian Lipson and Katharine Landells from Withers, share their advice on managing a pre-nup so it doesn’t kill the romance.
When it comes to a pre-nup, the importance of good communication in a relationship comes out in spades. No one wants the discussion of a pre-nup to turn into a dress-rehearsal for a divorce.
But, done well, it is an opportunity for a couple to learn how to talk about difficult issues – including how to discuss money and handling the demands of parents and prospective parents-in-law. For a couple where there is a significant difference in their or their family’s financial positions, that dynamic can create tension.
That’s going to be especially unwelcome for couples who have been waiting patiently (or not so patiently) through the past year and more to hold their long awaited celebrations.
Alongside the wedding planning has come a leap in demand for pre-nups and we have seen a huge increase in the past couple of months. Interestingly, a lot of these requests have come from soon-to-be newlyweds where at least one of the families has significant amounts of wealth.
In these circumstances, we often find that it is the older generation – parents, trustees, guardians etc. – who are adamant that a pre-nup is agreed. That would be the case whoever the future spouse was (which it may help to say to them up front).
The motivation here is of course the protection of the family’s assets should the relationship come to an end.
Experience shows that judges can treat assets, that form part of the wider family wealth, as a resource to be drawn on in the event of a divorce. As many of these ‘next gen’ members of wealthy families are not only expected to be custodians of the family wealth but are also very active in philanthropy, investment and start-ups, the situation can get immensely complicated and the prospect of adding a court battle on top if there’s a divorce is distinctly unappealing.
Pre-nups are a neat way of addressing this concern, allowing couples to set their own agenda in the event that the worst should happen. But it can also be a difficult issue to raise, given the underlying implications that there may be a lack of trust, or even preparation for the possibility of the relationship failing.
For the discussion and negotiation of a pre-nup to be as seamless as possible there are three really important guiding principles.
Communication is key
There’s no doubt that bringing up the topic of a pre-nup has to be done sensitively and intelligently. In our experience, this is best done as soon as possible, just as the couple might start discussing whether they want to start a family, or where they would like to live long term. To put it another way, don’t leave it until the wedding date is almost due – turning things into a white-knuckle ride isn’t helpful at all!
Find a time when your partner is in a good mood, and you have time to talk things through properly. Being straightforward is always the kindest approach, including a clear explanation of what the pre-nup will entail and why it’s felt to be necessary.
If, as in this case, one of the families is insisting on the pre-nup, this can help to make it less personal for the other party. If the same requirements apply to everyone who marries into the family, it shows that nobody is being singled out for special treatment.
Don’t let the lawyers kill the romance
Choose a lawyer who you like and trust and who you know will take a sensible approach. Do some research and check out the lawyer’s reputation in the market. The person you choose will affect how things go. Whilst each of the couple will need to have independent advice on the agreement, that doesn’t mean that battle lines need to be drawn for a protracted negotiation. If you’ve had a chance to talk through the principles between you already, make sure the lawyer knows that.
Find a good time to speak to your lawyer when your partner isn’t around. If you’re already living together, there’s nothing more awkward than having lawyers’ meetings in the next room on Zoom and then going to the kitchen for dinner and a glass of wine pretending it didn’t happen.
Be open and honest and choose a lawyer who will help you navigate the conversation with your partner, not make it more difficult. They will explain the various ‘flavours’ of pre-nup to choose from, and tell you which one(s) would be best for you.
The best asset protection is not to get divorced
Cynics may say that the best form of asset protection is not to get married in the first place, but for many couples marriage is the foundation stone for their future relationship, and therefore a pre-nup is the ultimate insurance policy. But even with a pre-nup in place, the best form of financial protection is for the marriage to be a long and happy one.
Sometimes a cautious approach is most definitely the right one, particularly if the relationship is untested or unstable, but it is important for couples to see a pre-nup as part of a wider dynamic, particularly when working out what it should say.
That is even more the case where you or your partner is marrying into a large family where it is hoped that they will adopt and pass on to the next generation the values and assets that have resulted in the family’s success to date.
There is a fine line to be walked between ensuring that the pre-nup acts as a safety net against the worst happening, but at the same time making sure that putting one in place doesn’t undermine the relationship, build resentment, or set the marriage up for failure.
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