Prenuptial Agreements on the Rise: Here's Why
Prenuptial agreements have a long-established reputation as something less-than-romantic. While they may have once been viewed as being used only by celebrities or the super wealthy, many Americans now see prenups as a practical move and an effective means for protecting their rights and interests when entering into a major life decision.
According to a recent survey conducted by the American Academy of Matrimonial Lawyers, prenuptial agreements have been increasingly used by American couples prior to marriage. In fact, roughly 62% of divorce and family law attorneys surveyed reported substantial increases in prenuptial agreements over the past three years (and a fivefold increase in prenups over the past two decades). Almost half of the lawyers also noted that more women are stepping forward to initiate prenup requests.
As we discussed in a recent blog reviewing divorce statistics from the past year, divorce is an area of law highly susceptible to change. That’s driven in large part by evolving social views and perspectives, in addition to factors such as new legislation, tax reform, and even economic trends. It makes sense, then, that a significant increase in prenuptial agreements are also driven by the same factors.
Why are Americans Choosing Prenups When Beginning Marriage?
Americans are getting married later – Statistics show that Americans, particularly young adult millennials, are waiting longer to get married than their parents or previous generations did. Today, the average age of marriage among American men is 29, and the average age for women is 27, according to Pew Research. That’s several years older when compared to the average age of marriage in 1963 (21 for women and 23 for men). Marriage has also become a lot less important to millennials than other major life events, including graduating college or establishing a meaningful career. In fact, over 70% of millennials said they would postpone marriage and having children to relocate for a job in a desired location. That means millennial couples who do decide to get married at an “older” age are more likely to bring some financial security with them, such as assets they’ve accumulated, first-homes or condos they’ve purchased, and even wealth in the form of retirement accounts or stock programs offered by their employers (especially in the tech industry). They view prenuptial agreements as an effective means to protect those things should they encounter problems down the road.
Young adults have been more exposed to divorce – While Americans getting married at an older age and with more assets is a large driving force behind increases in prenuptial agreements, so are their views of divorce. Views that have been shaped by having more exposure to the process than the previous generations before them. With divorce rates at their highest in the 1980s and 1990s, many millennials have been exposed to divorce, whether it was through the divorce of their own parents, divorces involving their friends and family members, or even depictions seen on TV and film. These experiences have had a lot to do with shaping their views about divorce, leading many to see marriage as something that doesn’t always work, and which has the potential for dispute and contention over issues like property division they would want to avoid in their own adult lives.
Changing views of divorce and marriage – Overall, views on marriage and divorce have changed immensely throughout the years. Today, people of all ages find divorce more acceptable than in the past. While this includes millennials, it also includes older Americans. In fact, adults ages 55 and older accounted for more first-time divorces in 2017 than any other age group, according to the legal service Avvo. Experts suggest changing perspectives on marriage and divorce may also be fueled by economic factors. For example, millennials who grew up not only during a time of high divorce rates, but also the Great Recession may be more aware of the risks that accompany finances, debt, real estate, and other assets, as well as what happens to them when they are divided in divorce. Older adults and those whose first marriages ended in divorce also have financial concerns that might make prenups more attractive, including established businesses, retirement, health care, and more.
- Greater needs for safeguard – Because more marriages involve couples, be they millennials or older adults, who have established careers and gained some financial security, more couples are seeing the benefits of using prenups to safeguard their interests. For millennials, prenuptial agreements are also a way to address the large liabilities, which typically takes the form of student loan debt (which is now just under $1.3 trillion in the U.S.). Debt division, including student loan debt, credit card debt, and other liabilities, can be effectively addressed in pre-marital agreements.
The factors driving increases in prenuptial agreements are interesting to consider, but it is key to note that more American couples are viewing prenups as a reasonable and important part of marriage, as well as a way to protect interests and avoid disputes if things don’t end up as planned—which statistics show can and does happen.
Protecting the Rights of Clients Across Collin & Denton Counties
Prenuptial agreements, like marriages, are personal decisions involving two people, and they can benefit anyone (man, woman, young, or old), who wants to take advantage of available legal tools to protect themselves. This is particularly true in matters of separate property, division of debts and assets, and spousal support – the most commonly addressed issues in prenups. Those issues can be addressed by couples together as part of collaborative and amicable negotiations.
At Coker, Robb & Cannon, Family Lawyers, our award-winning attorneys are committed to providing the counsel, insight, and experienced representation to help clients protect their rights and interests in matters important to them. If you have questions about prenuptial agreements or any other divorce or family law matter, our team is available to discuss your situation and review your case.