61% of Canadians think getting a prenup is a good idea, according to one survey. If you are part of the two-thirds of Canadians considering getting a prenuptial agreement in Ontario, you may wonder what the advantages and disadvantages of getting one are. Spoiler alert: There are more pros than cons, but it’s still good to consider both sides of the coin. Let’s dive into everything you need to know about getting a prenup in Ontario.
Advantages of getting a prenup in Ontario
First, let’s talk about the good things about getting a prenup in Ontario. What makes getting a prenup worth it?
Financial transparency with your future spouse
Part of the legal process of getting a prenuptial agreement in Ontario is financial disclosure, which requires both parties to share the values of all financial information–income, assets, debt, and future inheritances. This means you will learn your partner’s net worth and get a good understanding of what you’re walking into as a couple.
An opportunity to discuss life goals
Getting a prenup requires you both to discuss the future in order to come to terms on certain topics. You will be required to talk about things like, Will you have children? If so, will someone need to stay home with the children? When do you want to retire? How aggressively do you want to save for this? How will your spending look during the marriage? Would you be okay with caring for elderly parents one day, etc. It’s about creating total alignment with your spouse on all aspects of the marriage, not just planning for a divorce.
Financial security
Whether you are the wealthier spouse or not, getting a prenup should make you feel financially secure. That doesn’t mean the terms have to be 50/50–it just means each person should be reasonably accommodated in the agreement. Financial security is a priceless advantage to getting a prenup.
Protecting children from previous relationships
A prenuptial agreement offers valuable protection for those with children from a previous relationship. It ensures that your assets remain yours, protecting your children’s future inheritance in the event of divorce or your passing. By clearly defining separate property, a prenup prevents a future ex-spouse from claiming assets intended for your children. You can also waive any claim to the other’s estate, making sure all of your assets go to your children.
Protection for pets
You can include pet custody clauses in your prenuptial agreement. We all know pets are family, and making sure your pup remains in your possession in the event of a divorce is important. You can also opt for shared custody, and if that’s the case, working out who is responsible for what pet bills is something that can put your mind at ease.
Streamlined divorce
If you do eventually need to use your prenup because you are getting a divorce, it makes the process cheaper and quicker because there are fewer issues to decide. With a prenup, you’ve already determined all property division and spousal support issues. This saves you time spent arguing over these topics and saves you lawyers’ fees in the time they spend assisting you on it.
You can override Ontario default law
You can override the default law in Ontario with your own property and spousal support rules in a prenup. One of the default laws in Ontario regarding property division in a divorce is to equalize assets and require the wealthier spouse to pay the less wealthy spouse half of their increased net worth. There are also special rules when it comes to equally dividing the equity in the matrimonial home – regardless of who owns the home and who bought the home. If that doesn’t sound great to you, then getting a prenup may be a good idea to avoid this default law.
Achieving your first obstacle as a soon-to-be-married couple
83% of HelloPrenup couples say that they felt closer together after the prenup process was completed. This is likely due to the fact that going through the prenup process requires collaboration and teamwork to make sure both parties are protected and feel good about their shared life ahead.
Disadvantages of getting a prenup in Ontario
Okay, so prenups sound pretty great, right? But like everything in life, there’s a flip side. Don’t worry, it’s not all doom and gloom, but there are a few things to keep in mind before you jump in. Let’s take a look!
Uncomfortable conversations
While the upside to getting a prenup is total financial transparency and life alignment, these conversations can also get uncomfortable. If you aren’t used to talking about money and long-term goals, this can get pretty tense and awkward with your future spouse.
Cost
Money, money, money. Things cost money. And just like everything else, prenups in Ontario are not free. A prenup the traditional way (hiring two lawyers) can cost anywhere from approximately $5,000 to $10,000. Again, this price can fluctuate greatly depending on your lawyer, your situation, and where you live in Ontario.
Potential for disagreements
Another con of getting a prenup is the potential for disagreements. If you and your partner are unable to agree on certain terms, such as spousal support, then it may create tension. However, the good news is that this is rare. According to a HelloPrenup survey from 2023, 83% of couples actually felt closer together after the prenup process.
Legal process
Things that are fun: Getting a massage, going shopping, playing games, going on vacation. Things that aren’t fun: Doing your taxes, cleaning your bathroom, calling a utility service, creating a legal document. While HelloPrenup does arguably make the legal process of creating a prenup a bit more fun–let’s call a spade a spade–it’s a legal process at the end of the day.
You need to find a witness
This one is minor but worth noting. In Ontario, you are required to have your prenup witnessed by someone who is not a party to the contract. This could be a friend, stranger, coworker, etc. Some people may find this to be awkward or uncomfortable to bring someone else in on such a private matter. The witness does not need to read the document by any means but simply watch you sign the document.
Negative perceptions of prenups
Some people still hold old-school views on prenups and believe that they are bad omens or signs of distrust. If your partner (or you) is one of those who still feels this way, then getting a prenup may spark some relationship disputes. If this is your partner, here are some tips for talking to them about getting a prenup.
The bottom line
So, what’s the verdict? Ultimately, whether or not a prenup is right for you depends on what you and your partner value most. Take some time to really think about the pros and cons we’ve discussed. Consider your individual needs and goals, as well as your shared vision for the future. Do the benefits of protecting your assets and providing clarity outweigh the potential discomfort of discussing financial matters? It’s up to you! Happy planning!
Anna-Marie Musson is a Family Lawyer with over 20 years’ experience. A graduate of Windsor Law, Anna-Marie began practising in 2003. She was a partner at a prominent national Bay Street law firm before starting her own firm. Anna-Marie helps professionals and high net worth clients navigate the financial, emotional, and legal issues in divorce and separation. She also helps clients preserve their net worth and avoid financial ruin with Marriage Contracts (Pre-nups) and Cohabitation Agreements. Anna-Marie is the host of the Modern Divorce Show on 105.9 The Region and also hosts the upcoming Podcast – Love & Wealth.
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