Millennials are driving the rise in couples getting prenups as they try to avoid the ‘messy disentanglements’ of their boomer parents — what you need to know before tying the knot
It’s definitely not as romantic as planning your wedding or that dream honeymoon, but experts say prenups are a smart move for couples looking to join — and protect — their financial futures.
A recent Harris poll found that 15% of Americans have signed a prenup — up from just 3% in 2010. It’s even more common among younger folks, with 40% of those who signed one being between the ages of 18 and 34.
Millennials — many of whom watched their baby boomer parents go through stressful divorces — make up the bulk of those choosing to draw up an agreement before heading to the altar.
“They don't want to make the same mistakes [as their parents]. Some of us saw real disasters,” says Julia Rodgers, a former family law attorney who built HelloPrenup — an online platform for couples to create their prenuptial agreements.
“Families were torn apart and things were litigated,” says Rodgers. “It was very stressful and a lot of it was over the basis of money.”
Don’t miss
Better than NFTs: You don't have to be ultra-rich to own a piece of a Pablo Picasso. Here's how to enter the fine art market
'Hold onto your money': Jeff Bezos says you might want to rethink buying a 'new automobile, refrigerator, or whatever' — here are 3 better recession-proof buys
Americans are paying nearly 40% more on home insurance compared to 12 years ago — here's how to spend less on peace of mind
Millennials are getting married later in life
Rodgers says over half of HelloPrenup’s users are millennials and she thinks the reason for the rise is because, “We view marriage differently. We view it as a true partnership.”
A report from the Pew Research Center found that over half of American millennials are not married and those that do are getting married later in life than other generations.
Baby boomers were more likely to get married — and divorce — young.
In 2019, the average age for men was 30, while the average age for women was 28 when they married for the first time — seven years older than the average in 1968.
The Pew Research Center found in 2017 that divorce rates have doubled in the U.S. since the 1990s for people over the age of 50.
Reasons to get a prenup
Sarah Jacobs, a matrimonial law attorney based in Morristown, New Jersey, says couples may be hesitant to consider or talk about a potential divorce.
However, Jacobs says to think of a prenuptial agreement as a “security blanket.”
Protecting money and assets
Jacobs says that couples who benefit most from prenups are those who have significant assets and liabilities that would be at stake in a divorce. Couples who are either starting or already have a business would also benefit from putting something in writing.
There’s also the issue of inherited money and assets.
According to CNBC, baby boomers are set to pass down over $68 trillion in wealth to the younger generations — their millennial and Gen Z kids.
A study cited by CNBC found that over half of millennials who are expecting an inheritance from a family member said they expect to receive at least $350,000.
The more cash and assets on the line, the more important it becomes for couples to stake out what happens to that wealth should the marriage break down.
Millennials aren’t the only ones who should consider having this conversation, older Americans have things to consider as well.
Jacobs recommends a prenup for couples who are getting remarried or who have children from other relationships and want to codify what happens to their kids’ inheritance.
Dealing with debt
Prenups aren’t just for protecting assets — there is also your respective debts to consider.
With household debt climbing at its fastest pace since 2008 and interest rates hitting record highs, it’s becoming even more important for couples to talk about this aspect of their finances.
The average millennial owes over $100,000 in non-mortgage debt, such as credit cards and student loans, according to a 2022 survey.
About 10% of in-debt millennials also said they believed it would take them over a decade to pay off their debt — something you probably don’t want to be saddled with in the event of a divorce.
Some states, such as California and Texas, are community property states. This means that in the event of a divorce, couples typically must split all assets and debt incurred during the marriage, unless they have a prenup that specifies otherwise.
Read more: The 10 best investing apps for 'once-in-a-generation' opportunities (even if you're a beginner)
Prenups can be costly — but not always
Rodgers notes that many people may also be hesitant to draw up a prenuptial agreement because of factors like cost and accessibility.
While Forbes estimates the average cost of a prenup in the U.S. at $650, it can also go up to thousands of dollars, depending on multiple factors.
Each partner typically hires their own attorney to represent them and help them draft the contract.
Jacobs says that some lawyers charge a flat fee — she has seen fees range from around $2,500 to $3,500.
Other lawyers may use that dollar amount as a retainer and charge additional fees depending on the breadth of work and complexity of the contract.
Rodgers says being able to go through this process online can be cheaper and makes it more accessible and collaborative for many couples.
“We're giving them the power back — or allowing them to create the draft together as a couple, in unison — and then take that draft to an attorney if they want legal advice,” she adds.
While you can sign a prenup without consulting a lawyer, Jacobs says it’s important to receive legal advice and protect yourself in case it gets contested in the future.
What you should include in a prenup
Jacobs says you’ll need to talk about what can be divided in a divorce as best as you can “without a crystal ball.”
A prenup can include broader items such as bank, retirement and brokerage accounts and real estate — but can also come down to more minute things like airline miles and credit card points, she explains.
Couples should also be discussing their existing debt as well as debt they may acquire in the future. For example, one partner may decide to go back to school and incur student debt or you may have plans to take out a mortgage on a house together.
Jacobs says in essence, a prenup allows couples to have an open conversation about their current and future finances.
“And [discuss] how best to protect themselves now for their future selves to mitigate against messy disentanglements.”
What to read next
You could be the landlord of Walmart, Whole Foods and Kroger (and collect fat grocery store-anchored income on a quarterly basis)
Here are 3 easy money moves to give your bank account a boost today
Millions of Americans are in massive debt in the face of rising rates. This free service helps you save on interest payments
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
