Prenups can sometimes get a bad rep, but the truth of it is as many as 44% of single adults think getting a prenup is a good idea. The other 56% probably have hang-ups around prenups that are largely based on misconceptions. We’re here to bust those myths and clear up all those nasty rumors about prenuptial agreements.
Misconception #1: Prenups only protect the wealthy
It’s no wonder people think prenups are only for the wealthy; the only time we hear about it in the media is when some uber-rich and famous person gets a divorce. The reality is prenups are for everyone, not just the super wealthy. For starters, there’s no net worth requirement on who gets a prenup. A prenup protects the person with $10 million just as much as the person with $100k. A prenup can also protect someone without any assets at all. For instance, if you are a stay-at-home parent or make significantly less money than your partner, a prenup can actually balance out the wealth by providing you with more assets and money. That might be through a wealth equalization clause (i.e., lump sum clause), alimony (i.e., spousal support), awarding you more assets, such as the marital residence, and more.
Let’s demonstrate with an example of how prenups protect everyone, not just the wealthy. John and Sarah are about to get married. John is a trust fund baby and is worth about $20 million. Sarah is a starving artist whose net worth is about $1,000. John and Sarah have agreed that they will have kids right away, and Sarah will be a stay-at-home mom. They want to get a prenup, not just to protect John’s money but also to protect Sarah! Their prenup states (among other things) that John keeps his existing property separate, including his real estate portfolio (valued at around $10 million) and investment funds (valued at $7 million). If they divorce, Sarah will receive a lump sum payment of $3 million and will be awarded the marital residence (she will be staying home with the kids after all). They agree that any money John makes during the marriage will also be split up between the two accordingly. The prenup sets Sarah up for success (she gets $3 mil, the marital residence, plus a cut of the money John makes during the marriage) while simultaneously protecting most of what John had before the marriage (roughly $20 mil plus a portion of what he makes during the marriage minus the $3 mil he has to pay to Sarah), in the event of a divorce. John feels secure in that he won’t lose half of his previously owned money and Sarah feels supported, even if the marriage comes to an end.
This is just one scenario. Sarah and John could have negotiated for more or less, which would change the outcome, but you get the point! Prenups don’t just hoard the money for one person; both people should feel safe with the outcome.
Misconception #2: Getting a prenup means you have a bad relationship
When some people think of prenups, they think of distrust or bad relationships. “Oh, we would never need a prenup because we have a good relationship.” At some point, most people getting a divorce would also say they had a good relationship at one time or another.
We want you to shift your mindset for a minute. Think about it this way: when you get car insurance, does it mean you’re a bad driver? No, of course not; it means that things happen, and you need a backup plan. Prenups are the same. While prenups aren’t exactly insurance, they are quite similar, which is why we like to call it “marriage insurance.” You get health insurance, home insurance, car insurance, life insurance, travel insurance, liability insurance, and possibly more! What about marriage? Shouldn’t we “insure” that, too? I mean… it is our finances on the line, after all! Getting a prenup truly has no bearing on whether or not you have a good relationship whatsoever. It’s simply a contingency plan for the “what ifs,” just like insurance.
Need more convincing? How about real-life success stories where couples get prenups and live happily ever after? Michael Douglas and Catherine Zeta-Jones are a great example. They have been married for over 22 years now, and they got a prenup at one point! Same thing for Keith Urban and Nicole Kidman; 16 years into marriage and still going strong despite having gotten a prenup. Both of these couples have prenups and have been together for many years. Not to mention, in Hollywood, 16 and 22 years are equivalent to 90 and 100 years in normal people’s time (but don’t quote us on that).
Misconception #3: Prenups tend to be one-sided or unfair
Some people think, “why bother with a prenup? It’s only going to benefit one person.” We’re not sure where this misconception stems from, but our guess is probably the media’s portrayal of prenups. The fact of the matter is prenups are generally legally required to be reasonably fair. They don’t necessarily need to be 50/50, but if a prenup is extremely one-sided or unfair, the court may actually throw the whole thing out! Yes, that’s a real thing.
Still don’t believe us? Read this real case from Indiana where a court actually threw out the prenup because the prenup was way too unfair. At the time of the prenup, the husband was worth about $31 million. The prenup said upon divorce, the husband will pay the wife $500k of alimony, plus $500 per week while the divorce is ongoing. During the divorce proceedings, the husband had actually gone bankrupt and was worth about $300k. Enforcing this prenup would be totally unfair to the husband, so the court threw it out! Interested in more information like this? Click here to read more about extremely unfair prenups (courts typically use the term “unconscionable” for extreme one-sided or unfairness in prenups).
Misconception #4: Prenups are often thrown out in court
Now, with the above misconception in mind, you may be thinking, well, prenups are thrown out sometimes; what’s the point?! First of all, it’s not typical to throw out a prenup. If you have a legally sound prenup (i.e., it’s valid, fair, etc.), the chances are the court will enforce it. At the end of the day, a prenup is a contract, and all contracts are subject to scrutiny, from prenups to car leases to non-disclosure agreements. Any type of contract can be thrown out, not just prenups. As long as you use a reliable source to draft your prenup, you should be in a good position.
Misconception #5: Getting a prenup costs a fortune
Going the traditional route of hiring a lawyer may cost you, on average, about $2,500, and that’s if you don’t have a complex case. It can get up to $10,000 or more if you have a particularly expensive lawyer or complex finances. But we are here to bust this myth and tell you how HelloPrenup is here to save the day and disrupt the market on prenup costs.
With HelloPrenup, you can generate a legally sound prenup for just $599 per couple! That’s just $300 per person!
Misconception #6: Getting a prenup means your relationship is going to fail
No, getting a prenup does not mean your relationship is going to fail, and guess what? You already have a “prenup.” It’s called your state’s default divorce laws. If you get a prenup, you override those default rules. So, what’ll it be? Your way or the state’s way?
“Imagine the possibilities if we thought of prenups as stress-reducing tools that strengthen relationships, rather than weapons that merely guard assets.” -Professional Life and Divorce Coach, Vindy Teja
When going through the process of getting a prenup, you will unearth many new things about your spouse. The process itself forces a couple to discuss hard topics like death, divorce, money, family, children, life goals, financial goals, and more. This type of in-depth conversation really strengthens a couple’s understanding of each other and facilitates alignment on life goals, expectations, and roles.
Getting a prenup actually produces the opposite effect of a failed relationship and instead strengthens your relationship.
Nicole Sheehey is the Head of Legal Content at HelloPrenup, and an Illinois licensed attorney. She has a wealth of knowledge and experience when it comes to prenuptial agreements. Nicole has Juris Doctor from John Marshall Law School. She has a deep understanding of the legal and financial implications of prenuptial agreements, and enjoys writing and collaborating with other attorneys on the nuances of the law. Nicole is passionate about helping couples locate the information they need when it comes to prenuptial agreements. You can reach Nicole here: [email protected]