Pre-marriage or cohabitation agreements can bring some stigma, which outlines the fate of couple’s assets if the marriage or common law relationship ends. One might argue that this indicates a lack of trust or endurance in relationships. Experts say, but the conversation doesn’t have to become sour.
Most professionals would recommend a training for couples with wealth differences, or if one of them would certainly inherit money from the family, even in the case of a second marriage, to clarify the division of assets.
Prenups sets basic rules from asset to expectations
But as more people who live later come together, many already own homes, vehicles or have assets such as larger investments and savings. Aimee Schalles, a lawyer and co-founder of United Solutions Ltd., said Prenups can retain these assets and record what each spouse enters into marriage or cohabitation.
“We think Prenups are for everyone,” Schalles said. “We think that even not many people can benefit from documenting what their arrangement is and at least what brings them into the relationship.”
Usually, divorce follows the default provincial family law without a legal prenuptial agreement.
Holly Levalliant, a real estate and trust consultant at Scotiatrust, said that although she doesn’t always recommend nurturing to all clients, splitting can be difficult without a preset agreement. “You don’t marry someone who’s divorced,” she said. “You may end up in a situation where you don’t regret not having these conversations later.”
Levalliant said the pre-marriage outbreak required both parties to disclose their complete financial situation. Hiding assets and debts may invalidate the agreement. She added that partners also need to seek independent legal advice.
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Prenups protect assets and provide financial security
While Prenups is primarily intended to protect everyone’s assets, it can also help avoid taking on partner debts. In most provinces, marriages people bring in still exist, including debt, Schells said. “If you have a relationship with many student debt in most provinces, it will be your reservation and your responsibility,” she said.
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But like assets, debt can accumulate interest – partners may have to share. This can be avoided through a prenuptial agreement.
Experts say the timing of these agreements is also very important. For example, a pre-marriage agreement cannot be reached a day before the wedding, which can cause a person to feel forced to sign documents without choice or time to find a lawyer.
“The court looked at a similar question: When will the wedding be planned? Are people attending the wedding? Have the invitation been sent?” Levalliant said. “If you put too much pressure on that party and they feel they have no choice but to sign it, it could be an invalid agreement.”
Flexible Prenup grows as your relationships and environment grow
How a conversation about a prenuptial agreement depends on how the topic is proposed.
Blair Evans, vice president of tax and real estate planning at IG Wealth Management, said talking about pre-maritality is essentially an expansion of financial planning. “Sometimes, having financial discussions is daunting, but the more financial discussions you have with your partner, the more daunting they become,” he said.
Schalles says storytelling methods can help you come up with it. “Unfortunately, almost everyone knows someone who has experienced a bad division,” she said.
One way to propose the term “PRENUP” during a financial inspection may be to slide it in. “It could be saying to your partner, ‘Hey, you know, you remember our friend Jonathan, the kind of horrible division he had with him years ago, how much stress did that put on him and his ex-wife? I don’t want to let any of us.”
She added: “If we were to find ourselves in this situation, I hope we had plans ahead of time so we didn’t find out what we were going through because everyone agreed that it was ugly.”
