Prenups tend to get a bad rap. Or at least, they used to. Millennials are far outpacing older generations when it comes to signing prenups, and that's probably not a bad thing.
While many people assume that the only reason to get a prenup is if you see divorce in your future, the truth is a prenup can help make marriage more equitable and enjoyable. Today, we're exploring why so many many millennials are investing in premarital agreements.
The Math Behind Millennials and Prenups
A recent survey of the American Academy of Matrimonial Lawyers found that 62% of respondents said they saw an increase in prenups from 2013 to 2016, and more than half cited a rise in prenups among millennials specifically.
For a long time, "prenup" has been a dirty word. After all, why would you want to sign a legally binding contract about divorce before you're even married? It's a question prenup critics often pose. The truth is, there are several reasons millennials are signing prenups more.
First, many millennials are children of baby boomers—a generation with a stunningly high divorce rate. Since the 1990s, the divorce rate for individuals 50 and over—a demographic comprised mostly of boomers—has almost doubled.
Prenups can make a divorce much less contentious. Even though any divorce will be painful, having preset terms for processes like property division allows couples to avoid the bitter court battles that often come with a contested divorce. Prenups might tempt millennials who watched their parents get entangled in ugly divorces, offering up a way to avoid the conflict associated with divorce.
Another factor is the marriage age. In 1960, the median age for first marriages was 20 for women and 23 for men. Now, it's 27 for women and 29 for men. That 6-7 year jump gives individuals much more time to collect assets that they may want to protect in the event of a divorce, such as an investment portfolio or property.
Lastly, stigmas around prenups are changing. Many people see prenups as a way to protect each other, not just their assets. For example, let's say you plan to open a business or make a risky investment at some point in the future. A prenup can allow you to protect your partner from that investment if it goes south, so they don't get saddled with some portion of the debt if you divorce.
Prenups also aren't necessarily forever. It's easy to put a sunset clause in your prenup that voids the terms of the contract if you stay married for a certain amount of time. For many couples, it's a great compromise between protection and commitment.
In conclusion, the increased rate at which millennials are signing prenups can be traced back to a number of societal factors, but it bodes well for the divorce rate that more and more millennials are using contracts like prenups to cultivate equitable marriages.