Prenuptial agreements are becoming increasingly common and they should not be seen as tools used by the 'super rich' or celebrities in order to protect their millions. The reality is that with the continued rise of house prices and the increasing difficulty young couples have in getting onto the property ladder, the 'Bank of Mum and Dad' are often stepping in to help their children take that all important step.
With such a heavy financial investment being made by parents it is understandable that they would want to protect their investment/gift in order to ensure that, should the worst happen, their child is the one benefitting. Prenuptial agreements will protect such an investment but can only be made if their is a marriage on the horizon. But what if your child isn't looking to get married and simply wants to buy a property with their partner? There are alternatives to prenuptial agreements that can be utilised if parents are making such investments without the prospect of their children getting married in the near future. Cohabitation agreements and trust documents can be implemented which offer a similar level of protection to couples and parents who wish to protect their interests.
They have long been used by rich and famous couples to protect their wealth if they divorce. But prenuptial agreements are being signed by more and more young couples – at the insistence of the Bank of Mum and Dad. Lawyers say prenups, which set out how a couple will divide assets if they divorce, have become a key part of wedding preparations, as parents of the bride and groom want to safeguard their investment. One leading law firm said the number of couples asking for prenups has doubled in a year, and quadrupled since the courts first gave legal force to such deals six years ago. It pointed to the influence of parents whose financial help is often the only way couples in their twenties and thirties can afford to buy their first home.