Millennials Are Seeking Prenups—and It Might Just Be Worth Considering
It’s not exactly news that millennials are marrying later than the generations before them. But to give you a sense of just how differently they approach the tradition from their parents, in 1962, nearly 60% of 18- to 30-year-olds were married. Today, just 20% of people in that same age range have tied the knot. As such, they’re older than their predecessors were, too—whereas the average woman in the ’70s was barely 20 when she walked up the aisle, today she’s over 27.
Waiting to be more mature and financially stable before marrying is not a bad thing, and could help to explain another trend on the rise among this age group. Before saying, “I do,” millennials are asking for prenups, in larger numbers than before. In fact, just over 50% of matrimonial lawyers attest that the number of millennials requesting prenuptial agreements is on the rise.
While prenups have historically been opted for by the wealthy as a means to protect their finances, those getting hitched today are carefully considering other assets at stake. They’re taking into account things like career potential and future wealth, ideas (that startup taking off, for example), and, more and more, the burden of shared student debt.
So, is a prenup the right choice for you and your partner? It could be worth considering. Here’s what you need to know before you say “I do.”
The heart of prenups
Contrary to what you might have heard, “prenup” is not a dirty word. A prenuptial agreement is just a pre-marriage contract designed to protect each party’s assets, earnings, and intellectual property in the event of divorce. Financially, it’s wiser than it is threatening. If your marriage doesn’t go the way you and your partner hoped, your financial situation won’t be dictated by your state’s property laws or a judge’s decision. Think of it more like an insurance policy than an escape clause—you don’t want anything bad to happen, but you plan for it nonetheless.
As you consider a prenup, focus on the following:
Proposing a prenup
Sure, asking your future spouse to sign a prenup won’t be nearly as romantic as asking him or her to marry you, but it will prompt you to have serious conversations about financial goals. Since the majority of millennials say financial decisions are a source of tension in their relationships, talking about money matters early—before you walk down the aisle—is a smart way to invest in a healthy relationship.
Start with these tips:
- Be honest. Discuss your family history and other experiences that have influenced your financial views. That way, your partner will know exactly where you’re coming from.
- Practice sensitivity. Don’t demand a prenup—discuss it. Do your best to keep extreme emotions at bay; don’t raise the issue in the middle of a fight, for example.
- Keep the conversation going. Don’t expect to figure out every detail of the prenup in one conversation. Revisit the topic as often as needed to come to an agreement that works for both of you.
Taking the prenup plunge
After you’ve talked to your partner and you’ve both agreed on the prenup terms, draft an agreement. You can do that yourselves, but consider hiring an attorney instead. In fact, consider hiring two—one for you and one for your partner. Your lawyers will help you create a prenup that not only meets your state’s requirements, but also helps ensure a court will uphold its validity.
Your earnings, assets, financial and property investments and intellectual property are all worth protecting, and a prenup is a means to that end. Connect with a member of the SoFi wealth management team to learn how to protect what you’ve earned before you tie the knot. Then, share this article with other couples planning a financial future together.