Preparing for marriage and partnership: prenuptial and postnuptial agreements

Prenuptial and postnuptial agreements are playing an increasingly important role in modern family wealth planning. They can be viewed not only as a means of managing the financial consequences of separation, but also as a valuable tool for protecting assets, supporting family governance and providing greater certainty around future financial arrangements.

Prenups, postnups, and the new reality of family wealth

Conversations about wealth preservation and succession are happening earlier than ever for many affluent families. This means that prenups and postnups are increasingly seen not as uncomfortable formal documents, but as practical planning tools.

Once associated largely with ultra-high-net-worth families, these agreements are now growing in popularity as more families face complex wealth, succession and cross-border planning considerations.

Families spend years building finances, businesses and structures designed to benefit future generations. In many cases, prenups and postnups can help to protect those plans.

These agreements matter now more than ever

At their core, prenups and postnups aim to create certainty.

In England and Wales, courts have significant discretion when determining financial outcomes in the event of divorce. Without an agreement, outcomes can be difficult to predict, even for experienced legal professionals – and this uncertainty can create risk where family wealth, inherited assets, trusts, family businesses or international structures are involved.

A carefully prepared agreement allows couples to discuss financial arrangements at a time when the relationship is strong, rather than during a potentially difficult separation.

Understanding the difference between prenups and postnups

Postnups are not simply ‘late prenups’. They can be particularly useful when circumstances change during a marriage. This might include receiving an inheritance, significant business growth, the creation of a trust, acquiring overseas assets, relocating internationally, having children or changing family governance arrangements.

In general, prenups address issues before marriage, while postnups respond to developments that arise during a relationship.

What can happen without an agreement in place?

For many families, understanding the default position is the starting point.

In England and Wales, financial settlements are often influenced by two key principles:

• Sharing

The sharing principle seeks to divide wealth accumulated during the marriage fairly between both parties.

The underlying principle is that both spouses contribute equally to a marriage, whether through earnings, childcare, caring responsibilities or managing the household, and that the fruits of their partnership should be shared equally.

• Needs

The second principle focuses on each party's financial needs.

Those needs can be interpreted generously, taking into account the standard of living the parties enjoyed during their marriage. Consequently, needs claims can sometimes extend further than families expect.

While the needs of the parties will always remain an important consideration, prenups and postnups can help protect inherited wealth, family assets and pre-marital property while creating greater certainty.

Protecting multi-generational wealth

For many families, these agreements are about more than just the couple involved.

Parents and grandparents often view wealth as something to be preserved and passed on to future generations. Agreements may therefore distinguish between:

• Wealth accumulated jointly during a marriage
• Inherited wealth
• Trust interests
• Family business holdings
• Family investment companies (FICs)
• Future gifts and family transfers.

The aim is often to separate assets intended for family succession from those intended to be shared within the marriage.

The growing importance of family governance

Prenups can be a key part of broader family governance planning.

Many families invest significant time in educating younger generations about wealth, responsibility and stewardship – and family charters, multi-generational meetings and next-generation education programmes are becoming steadily more common.

Although family charters are rarely legally binding, they can provide a valuable forum to discuss family values, succession plans, governance expectations and long-term objectives. In some families, prenups and postnups are also required before beneficiaries receive significant trust distributions or inheritances.

International families face added complexity

Planning becomes more complex when wealth spans multiple jurisdictions.

Families may own overseas property, hold international trusts, operate foreign companies or have family members with different residences and citizenships.

Different countries take very different approaches to marital wealth, but a number of questions typically arise:

• Which country's courts would have jurisdiction for divorce proceedings (sometimes more than one country will have jurisdiction, with potentially radically different outcomes)?
• Would a prenup or postnup entered into overseas be effective in England and Wales, and vice versa?
• Should the couple have one prenup or postnup, intended to apply in all relevant jurisdictions, or are additional mirror agreements needed elsewhere?
• Could relocating to another country affect the enforceability of an existing prenup or postnup?

For internationally mobile families, reviewing arrangements after a relocation can be just as important as entering into them in the first place.

Cohabitation agreements

Of course, not every couple chooses to marry.

For those living together, cohabitation agreements can help clarify property ownership, financial responsibilities and expectations during the relationship.

Cohabiting couples are currently treated differently from married couples under English law. They do not have a right to make financial claims against their former partner simply by virtue of the end of the relationship. Disputes can still arise, however, in relation to the ownership of property or appropriate financial provision if there are children. In addition, the government has indicated an intention to reform the current law to give cohabitants greater rights, increasing the importance of cohabitation agreements as a way of clearly recording intentions.

The importance of having the conversation

The most difficult part of prenups and postnups is often approaching the topic in the first place. But, more and more, advisers are encouraging families to frame these discussions around transparency, fairness and planning, rather than mistrust.

Useful questions to ask upfront may include:

• What wealth exists today?
• What wealth may be inherited in the future?
• What responsibilities come with that wealth?
• What values do we want to preserve?
• How should arrangements work if circumstances change?

Viewed this way, the conversation becomes less about preparing for failure and more about creating clarity.

What if you're asked to sign a prenup or postnup?

Being asked to sign a prenup or postnup can feel daunting, particularly where there is a significant disparity of wealth between partners.

The most important step is to obtain independent legal advice, ideally at an early stage. In order for a prenup or postnup to withstand scrutiny, it’s important for both parties to receive separate advice, provide full financial disclosure and have sufficient time to consider the terms without undue pressure. The substantive terms of the agreement must also be fair in the eyes of the court. This generally means ensuring that both parties' needs are met – although those needs can be provided for at a more basic level than would be the case without an agreement.

Negotiations can often lead to stronger protections and greater transparency for both sides.

A modern tool for modern families

Prenups and postnups have become an established part of modern family wealth planning. Increasingly, they are recognised as practical tools that support family governance, succession planning and wealth preservation. When approached thoughtfully, they can reduce uncertainty, encourage open conversations and help protect family wealth across generations.

The strongest agreements are not about anticipating failure. They are about providing clarity, fairness and confidence so that families can focus on the future.

Please speak to your Private Banker to discover how Coutts could support your long-term financial goals.

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