Prenuptial agreements are on the rise for Generation Y individuals, or “Millennials”, according to recent reports in the news. What is it about this group that is lending itself to an uptick in prenups?
The Millennial generation has many unique characteristics that may contribute to the want (or need) for a prenuptial agreement. Some of the most common reasons for a Millennial prenup are outlined below:
The Millennial generation grew up believing that their dreams could be a reality. This belief has a positive impact on a career vision plan. Many Millennials are choosing non-traditional paths and are inspired to work toward their goals, no matter how difficult or seemingly unattainable they may seem. As Millennials have matured, there has been an increase in “disruptors” – companies that form to challenge the traditional market leaders. The Millennial’s are often building up assets prior to marriage and want to preserve those assets as their separate property upon entering a marital relationship. A valuable benefit of a prenup is that it protects the parties’ assets, including businesses and business interests, and helps to establish how the economic side of the relationship will work moving forward. With the increase in start-up businesses by Millennials, a prenup can afford protection to the business owner and also provide for the non-owner if the couple so chooses.
Chasing career dreams and ambitions can take time, and many Millennials are putting marriage to the side until they’ve achieved certain goals. Couples that marry later in life have often amassed a larger amount of assets (and debts) than if they had married at a younger age. In the same way that prenups can protect the parties’ assets, these contracts can also provide protection from debt. It is smart to become informed about how marriage may impact assets, income and debt. This can be done with an experienced family law attorney. Then an informed decision can be made about whether or not to proceed with a prenup.
Increased Student Loan Debt:
Another reason couples sign a prenup is to provide certainty with respect to debt acquired before the marriage. The prenup can also address debt acquired after the marriage date. (For example, the parties may want to require mutual agreement on debt in excess of a certain amount or how payments towards a pre-existing separate property mortgage will be addressed.) The PEW Research Center found that Millennials are actually the “most educated” generation to date. Millennials, as a whole, have viewed an undergraduate college and graduate school education as necessary, and have taken on much more debt than previous generations in order to get it. When coupled with any other outstanding debt (credit cards, car/home loans, etc.), it makes sense that Millennials would want to enter into a prenup to ensure that the financial responsibilities will be divided fairly in the household. The financial disclosure included in prenup negotiations sets the state for clear expectations about how finances will work during the marriage.
Certain myths about prenups are not considered valid by Millenials (and others!) There is no longer a stigma attached to wanting a prenup and the document is positively viewed as bringing certainty and security to the economic side of the relationship. Open and honest conversations about how things will work during the marriage are viewed as a platform for establishing good communication and trust. Additional information about prenups can be found at: www.deborahwaynelaw.com.