4 minute read

Prenup Definition: What is a Prenup Agreement?

A prenup agreement can help protect your assets and finances in the event of a divorce. Learn more about how they work and whether or not you need one.

Julia Rodgers

Julia Rodgers, @juliarodgers

CEO, Co-Founder, HelloPrenup

[This article was written by Julia Rodgers, CEO and co-founder of HelloPrenup, the premier platform for prenuptial agreements.]

A prenuptial agreement is a legal contract between two parties who are engaged to be married. While a prenup must be entered into prior to marriage, it does not become effective until you get married. And no, you cannot sign a prenup after you get married (this is a common question!) 

Prenups allow engaged couples to make decisions regarding property rights and other financial arrangements before getting married. In doing so, you and your future spouse can take control of your financial futures and decide what happens to your property and assets both during the marriage, and in the unfortunate event of divorce. Conversely, if you decide to marry without a prenup, your state’s law will determine what happens to your property.  It’s your stuff, so shouldn’t you have a say in what happens to it if you split in the future? We think so…

Prenups can provide protection for both fiancés, and can include protections for: 

  • Personal property

  • Retirement accounts

  • Assets

  • Businesses/business interests

  • Student debt

  • Credit card debt

  • Mortgage debt

  • Inheritance

  • (and many others!)

According to Attorney Raymond Hekmat, Founding Partner at Hekmat Law & Mediation:

“The future of prenups is to use them as both the financial and social rules for marriage. It’s encouraging to see millennial couples at all income levels use prenups to clearly define how to succeed in a marriage, not just what happens in a divorce. With this mindset, prenuptial agreements become a marriage planning tool, rather than an obligation.”

How to start the prenup conversation

Prenups get a bad rap. The main gripe is usually that they are unromantic. Despite the negative stigma, prenups can facilitate effective communication around topics that are uncomfortable to bring up prior to marriage. While the initial conversation may feel awkward at first, these topics are really important for marriage, and in my opinion (and experience), lead to longer, happier marriages.

Now, I do not pretend to be a relationship expert. However, I have experience seeing how good communication leads to positive outcomes in a relationship, and (actual) experts agree with me. 

California prenup mediator and coach, Attorney Susan Scherman, offers the following advice: 

“Open communication is paramount, as is simultaneously maintaining independence, clear boundaries, and transparency while expressing what is important to you and why. It can also help if, before you begin the discussion, you mutually commit aloud to remain patient, open, and listen deeply. Should you disagree with a point your betrothed has stated, express it with kindness. Remind yourself that the whole reason this conversation is taking place is because you are becoming financial partners in your new life together.”

In addition, psychologist and founding team member of Pace Groups, Dr. Vivian Oberling believes that listening to your partner is of the utmost importance:

“What’s the most intimate act you can do with your partner? Listening. To listen- truly listen- creates and preserves intimacy in your relationship. This simple act tells your partner that you want to understand them and that you can put them first; that you can pause your own interests, needs, and opinions long enough to hear their perspective. It’s not about agreeing or being right, but about a clear message to your partner that they matter to you.” 

Benefits of getting a prenup (and who should care)

Let’s walk through some practical examples of how a prenuptial agreement can be useful, and why you should care.

Protection from debt

Between student loans, mortgages, and credit card debt, it’s common for fiances these days to both have some form of debt, and to bring their personal debt into a marriage. It’s an issue that can often lead to arguments and questions regarding who is responsible for the debt, and how repayment may affect the rest of your lifestyle. A prenup can help address these issues. Without a prenup, the division of debt is left up to the court. But with a prenup, you can specify who is responsible for what, allowing for peace of mind and mitigating future arguments.

While money troubles are a leading cause of marital discord, they don’t have to be. Take it from Silvia Manent, the founding and managing partner of Manent Capital. Silva says:

“Even though money is often a primary reason for relationship breakdown, potential disaster can be averted by opening up communication about your financial habits and goals. Don’t forget to talk about your credit scores and what they mean for your financial future. Calculate each of your net worth and make a budget together as a couple with your goals in mind. Decide how you want to invest. If you follow these simple pieces of advice, you can avoid many of the common financial pitfalls that can plague a relationship and set your own relationship up for success.”

Why you should care: No one wants to get stuck with someone else’s bill. If one of you is bringing significant personal debt into your marriage, a prenup can help! Your prenup can declare that a spouse is not responsible for their partner’s premarital debt. With so much at stake, this isn’t something that you want to leave to chance. Avoid this sticky situation with a prenup!

Streamline divorce

Divorce is hard. However, making decisions in your prenup about alimony and division of assets can save you a lot of headaches, and give you way more control over the process, should you need to go down that road. If you divorce without a prenup, state law and your assigned judge dictate what happens to your property and assets. This can result in a dissatisfying outcome for both partners. On the flip side, if you have a prenup, these issues have already been settled. When all of the tough decisions have already been made, the process of divorce becomes much more amicable.

Why you should care: No one wants to leave ownership of their hard-earned assets up to chance.  Knowing that all of the decisions have been made by you and your spouse well in advance can provide peace of mind and reduce the risk of a contentious divorce.  

Protecting a business

Owning your own business is huge. And so is protecting it. Luckily, your prenup can do just that.A prenup can establish the current value of the business at the time of marriage and decide what happens to the business should the couple divorce.  It can also address how business income and debt are treated.  

Why you should care: Anyone with a business should absolutely consider a prenup. Doing so could protect your business from being at risk in a divorce, or protect you from paying out half of the value of your interest in that business to your spouse.

Kids from a previous marriage

If either fiance entering the marriage has children, a prenup can help protect and provide for those existing children. Perhaps there is certain property that you want to be passed down to your children. Your prenup can specify and protect that property to ensure it goes to the children. Without a prenup, it can be difficult to ensure that specific property is maintained as the separate property of one of the spouses. Again, the peace of mind is priceless.

Why you should care: Any party that has children at the time they enter into their new marriage should consider a prenup to protect their children’s inheritance. This is extra important if there are certain items that you want to be passed down to your children.


While some states consider inheritance to be separate or non-marital property, other states view it to be considered marital property if received during the course of the marriage. The situation becomes more murky when it’s deposited into a joint account. So, if you want your inheritance to remain separate property, a prenup is a great idea. My experience has shown me that many couples believe inheritance should automatically be considered the separate property of the spouse who received it. However, this is not the case in every state. Some states view inheritance as separate, and some view it as marital property. Don’t make the mistake of assuming your inheritance will be considered separate property, without a prenup. 

Why you should care:  If and when you are to receive an inheritance may be unknown, but you can still protect it by adding any inheritance to your financial schedule along with dollar values. 

Stay-at-home parents

If one partner plans to forego their career to care for the couple’s children, a prenup can help to keep things fair. By sacrificing their career, one spouse is at a significant disadvantage financially, in comparison to the other spouse who can continue earning. A prenup can protect the stay-at-home parent and acknowledge the benefit they provide to the relationship.

Another important consideration is the continued quality of life for your children in the event of divorce. While generally, prenups cannot include terms related to child support or custody, they can ensure that both spouses maintain a similar lifestyle after divorce. This helps create consistency for the children by creating fairness in finances between the spouses.

Why you should care: Marriages often come with lopsided power dynamics, but prenups have the power to equalize the financial playing field by protecting both spouses.

When to start thinking about a prenup

You should start the prenup talk as soon as possible. This is not a conversation you want to start last minute. When it comes to relationships, honesty is always the best policy, in my book. If you are afraid of divorce because your parents divorced, explain this to your partner. If you are worried about financial issues in a marriage, say so. Make sure you are clear on your reasons for wanting a prenup, and allow yourself to be vulnerable with your partner. Coming from a place of honesty, love and compassion will allow you both to have a successful prenup convo. 

How can HelloPrenup help?

Getting married without a prenup can result in a more complicated and stressful relationship, because a prenup provides clarity in a marriage. With HelloPrenup, you and your fiancé can create a collaborative prenup online without ever leaving your couch. You and your fiancé will each fill out a questionnaire to determine what should be included in your prenup, resolve any differences in your answers, complete a financial disclosure, and print out a final agreement to sign and notarize. And the best news yet, your prenup will cost you a fraction of the traditional methods.