Planning a prenup? Here’s what you need to know

Wealth planning

A prenuptial agreement can be a delicate topic for couples. Learn how it can help protect your wealth and legacy.


The idea of a prenuptial agreement may seem like an unromantic start to what should otherwise be a joyful occasion. Yet it can be an important and useful document for marriages involving families with significant assets.

Since 2000, crude divorce rates have increased in most Asia Pacific countries. While no soon-to-be spouse wants to plan for a marriage to end, the fact is divorce happens. Making sure your prenup is right for you, and drawn up correctly, can help protect you and your wealth.

What is a prenuptial agreement?

It is a written contract between two people who are planning to get married and addresses the division of assets if a marriage breaks down. If done properly, and discussed early, it can be an effective wealth protection tool for all parties involved.

A prenup can also be an effective way to avoid court proceedings and minimize the potential financial and emotional toll on a couple if the relationship ends in a divorce.

“A prenuptial agreement can be very clear in laying down an understanding from both parties [on] what properties are shared between the couple,” points out Vivian Kiang, managing director and head of Wealth Planning and Fiduciary Services at RBC Wealth Management in Asia.

Start the conversation early

The first step for multi-generation wealth holders is to talk to their children about the expectation that their future partner will be asked to enter into a prenuptial agreement before joining the family.

When families have that discussion early – perhaps even before the child has met a partner – it reduces the emotion attached to the topic. Though the conversation may get emotional, the focus should be on how a prenup can protect the family’s wealth and legacy.

When it comes to bringing up the topic with a potential spouse, Kiang says the best way to begin the process is to start the conversation even before a future proposal.

“It may be difficult, but as a couple, as you get to know each other, that is the time you can fit a prenup [in] as a topic rather than waiting until after the marriage proposal, which can be unromantic,” Kiang points out.

She suggests normalizing the conversation on prenuptial agreements rather than making them seem like a taboo topic. This will reduce miscommunication and misunderstanding from both sides.

A possible way to start the discussion is by being transparent and clear, for example, explaining that prenuptial agreements are simply part of the family culture and that all new members are expected to sign one.

Set up a list to guide the conversation

As a prenup involves the division of assets between a couple, they should first separately list out all their assets and liabilities, suggests Octavia Liu, a wealth planner at RBC Wealth Management in Asia.

“Put that list on the table and decide which assets each of you prefers to keep,” Liu says. She suggests checking with a trusted advisor if this list of preferred assets works for you before having the agreement drafted.

Then, sit down with your soon-to-be spouse and your legal counsel and discuss these things candidly. Which assets will be held separately and which will be treated as marital property, and why?

Fully disclose each of your assets and debts. Decide how property will be purchased and titled during the marriage. Are you willing to commingle marital funds to purchase assets? How will the joint property be divided in case of divorce? How will household expenses be paid? How will you deal with personal debt incurred before the marriage?

Prenup planning and cross-border complexities

It is important to note that the legislation on marriage varies between jurisdictions. Couples in a cross-border marriage with assets in different territories should consider the law of all related jurisdictions when drafting their marriage agreement.

Below are how a few jurisdictions treat marriage agreements:

  • In Canada, prenuptial and postnuptial agreements are enforceable , but in some circumstances, the court may modify or ignore them or may set them aside if it sees them as unfair.
  • In China, prenuptial agreements are enforceable  and post-marriage nuptial agreements are also legal.
  • In Hong Kong, although prenuptial and postnuptial agreements are not yet legally enforceable , the court can still give “full weight” to the agreement given that it’s not seen as unfair to one spouse.
  • In Singapore, nuptial agreements are not enforceable  but will be considered by the court.
  • In the United States, nuptial agreements are enforceable  but child custody or child support are not included.

Liu points out that while it’s true that a cross-border marriage involves complexities when it comes to prenup discussions, “having one is still better than not having a plan at all.”

“A prenuptial agreement lasts forever but circumstances change, and that would mean that the contract might have to change as well,” Kiang highlights.

Protecting the family’s wealth for the next generation

The intention of a prenup is to preserve wealth, protect assets and clarify the financial rights of both spouses. It should establish the couple’s financial agreement and outline their intentions regarding property – whether it be separate and/or acquired during the marriage – and inheritances.

It should also delineate how assets will be divided, whether and how spousal support will be paid and how future earnings will be handled. This plan should explain the process and treatment of specific assets such as those set aside for children or assets that have been in the family for generations.

“Sometimes in reality, [a] marriage is not between just two people but between two families,” says Kiang. While there may never be a perfect time to broach the subject, doing it early, honestly and sensitively can help remove a lot of the emotion and maintain family harmony going into what should be a happy occasion.

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