The saying “what’s yours is mine, what’s mine is my own” is often said in jest. If you are going to live together or marry this may affect your ability to protect your hard earned assets in the future.
More people are looking to marry or cohabit when they have already accrued assets, maybe where there has been a previous divorce, or an inheritance has been received. There may be children from previous relationships who each party will want to ensure are protected. Discussions often take place at the outset giving reassurance of how each of you intends for such assets and wealth to be dealt with in the future, and when going into a new relationship or marriage, it is not a natural position to worry about what will happen if things do go wrong in the relation in the future.
So what can you do to protect your assets?
You can do a number of things:
When a couple have agreed to marry, and set the date, a Pre-Nuptial Agreement can be drafted setting out the assets of each party going into the marriage, and specify what the intention is for those assets in the event that marriage subsequently breaks down.
The assets are referred to and identified in a schedule annexed to the Pre-Nuptial Agreement to show the financial positions of each party at the time the Agreement is entered into.
The Pre-Nuptial Agreement also includes what is intended with future assets received during the marriage, and how the parties would intend those to be dealt with to achieve a fair and reasonable settlement. Whilst not currently legally binding or enforceable in the Courts of England and Wales, where a Pre-Nuptial Agreement has been properly prepared, the Divorce Courts will consider it, alongside other factors when looking at distributing assets.
There are strict guidelines as to the timing of Pre-Nuptial Agreements, and it is advisable that this is prepared and signed as far in advance as possible before the wedding to show that neither party was forced to enter into the Agreement at the last minute before the wedding. Hopefully it will be a document that is kept in a safe place and never needed, however, if the marriage does break down in the future, then it can be a useful and informative document in identifying the pre-marital assets and the intentions of the parties from the outset about how these should be divided.
Co-habitation Agreements/Living Together Agreements
There is a lot of misinformation regarding cohabiting couples. There is a myth that when parties cohabit they automatically acquire the same rights as married couples and are “common law” husband and wife. This is incorrect, cohabiting couples do not have the same rights as married couples. Where one party owns a property in their sole name, the other does not automatically acquire an interest in the property when moving in, even if they have lived together for a number of years.
A Cohabitation Agreement can be drawn up to set out the agreement and intention of the parties when they begin to cohabit, and can record any agreement as to financial contribution and what, if any, benefit they may subsequently receive as a result. This can prove very useful in the event of a separation when recollection of previous agreements may be forgotten or clouded due to emotions at the time.
If you have assets that you want to protect for you and your families future; we can help. It is not as complicated or costly as you may think.
It is important that you know how to protect your assets, depending upon your specific circumstances.
Contact: Waldrons on 01384 811811 to speak to one of our Family Law solicitors for more information.