Are you and your parents on the same page about prenups?

In Canada, the average marriage lasts fewer than 14 years, which makes signing prenuptial agreements a pretty wise course. This can be even more vital if a family-owned business provides all or part of the couple’s income.

Certainly the family’s wealth and business interests should be preserved from interlopers in the event of divorce. But the other spouse can also be entitled to compensation, which is why it’s best to be up front about what each will walk away with if the two divorce.

Different generations can hold very different views regarding prenups. When there is significant generational wealth in a family, especially if that wealth is tied to a successful business handed down for several generations, parents and grandparents can appear to be quite rigid in their views.

Young couples may feel as if they’re entering a merger instead of promising to love until death they do part. But well-crafted premarital agreements can strike a good balance between protecting family-held interests and providing for a partner at the end of a failed marriage.

If a marrying couple refuses to sign a prenup, the elders may need to take different financial steps to keep their assets within the family’s control. An adult child who marries without one may wind up being passed over for inheriting shares of the family business.

If you are entering a second, or subsequent, marriage with considerable assets and children from other unions to provide for, you must make sure that your interests are protected even if the marriage goes south. Speaking to a lawyer who handles family law cases can help you reach a mutually equitable agreement with your future spouse.

Source: Huffington Post Canada, “How Different Generations Can See Eye-To-Eye On Prenups,” Nathalie Boutet, Aug. 25, 2016

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