Estate planning is an important item when preparing for the future. It ensures that your assets are distributed according to your wishes and that your loved ones are cared for in the event of your passing.
While many people associate estate planning with wills and trusts, prenuptial agreement (prenup), is often overlooked but is also a crucial part of estate planning.
You’ve probably heard about estate planning and prenup before but maybe not used together. In this article, we will explore the role prenups play in estate planning.
What is a Prenup?
A prenuptial agreement is a legal contract entered into by a couple before marriage or a civil partnership.
Its main purpose is to state how the couple’s assets and debts will be divided in the event of divorce, separation, or death.
Prenups cover a wide range of financial matters, including property division, alimony, and the treatment of any businesses or investments owned by either party.
They can be valuable tools for any couple looking to protect their individual and joint financial interests.
From entrepreneurs safeguarding their business assets to individuals with significant personal wealth seeking to preserve family inheritances, a prenup can offer peace of mind and financial security.
For people with significant family wealth or inheritances, a prenup can ensure that these assets remain within the family bloodline.
Differences between Prenups and Estate Planning
| S/N | Prenups | Estate Planning |
| 1. | Typically happens before marriage or a civil partnership. | Can occur at any time during a person’s life. It is not inherently tied to a marital relationship. |
| 2. | The primary goal is to address the financial aspects of a marriage, specifying how assets and debts will be divided in case of divorce, separation, or death. | Estate planning involves the management, preservation, and distribution of assets during a person’s lifetime and after death. |
| 3. | Specifically address the financial aspects of the marital relationship. | It extends beyond the marital relationship to address broader concerns such as providing for children, minimizing tax liabilities, and ensuring the smooth transfer of assets to chosen beneficiaries. |
| 4. | A Prenup is an aspect of estate planning with a specific goal. | Estate planning is a comprehensive plan to manage a person’s wealth irrespective of marital status and does not always include prenups. |
What people think Prenups are
- Only for the wealthy: One of the most common misconceptions people have about prenups is that they are only necessary for wealthy people. In reality, prenups can benefit couples of all income levels by providing clarity and structure in the event of unforeseen circumstances.
- A sign of distrust: Some people view prenups as a lack of trust between partners. However, a prenup is not about mistrust but is a responsible approach to financial planning. It allows couples to have open and honest conversations about their financial expectations, responsibilities, and goals, putting measures in place to protect themselves.
- Enforceability concerns: A myth surrounding prenups is that they are easily challenged or difficult to enforce. While it’s true that poorly drafted agreements may face legal challenges, a well-drafted prenup, executed with the guidance of legal professionals, is more likely to stand up in court.
- Prenups are only relevant in divorce: Another common misconception is that prenuptial agreements only come into play in the event of divorce. While divorce is one scenario where a prenup is useful, it also serves as a crucial tool in the case of separation or the death of a spouse. In the absence of a prenup, state laws often dictate how assets are divided but a well-drafted prenup can provide clear guidance.
- Prenups ruin the romance: Some people believe that discussing and signing a prenuptial agreement can cast a shadow over the romance of marriage. Approaching the topic of a prenup can be an opportunity for open communication and financial transparency. It allows couples to have important conversations about their values, expectations, and financial goals, ultimately strengthening their understanding of each other. Rather than undermining romance, a prenup can actually make a healthier foundation for a lasting relationship.
Rather than undermining romance, a prenup can actually make a healthier foundation for a lasting relationship.
Benefits of Prenups in Estate Planning
- Asset protection: By clearly defining each partner’s rights and responsibilities regarding property and financial matters, a prenup helps shield valuable assets, such as real estate, businesses, and investments, from potential disputes or lengthy legal battles.
- Preservation of family wealth: For people with significant family wealth or inheritances, a prenup can ensure that these assets remain within the family bloodline. Without such an agreement, family assets may become subject to division in the event of divorce or separation.
- Business continuity: Entrepreneurs and business owners can use prenups to guard their business interests. This includes outlining the role of each spouse in the business, determining how business assets will be divided, and establishing financial arrangements in the event of a divorce or the death of a partner.
- Spousal support: Prenups allow couples to determine beforehand the terms of spousal support in the event of divorce. This can prevent lengthy and contentious disputes over financial support, providing both parties with a clear understanding of their financial responsibilities.
- Peace of mind: The most significant advantage of including a prenup in your estate planning might just be the peace of mind it offers. Knowing that your financial affairs are well-organized and that your wishes will be respected can alleviate stress and uncertainty, allowing you to focus on building a strong and lasting relationship while building wealth.
Knowing that your financial affairs are well-organized and that your wishes will be respected can alleviate stress and uncertainty, allowing you to focus on building a strong and lasting relationship while building wealth.
Conclusion
A prenup is a valuable and often overlooked component of estate planning. It is far from being a document solely for the wealthy because couples of all financial backgrounds can benefit from it. You don’t have to wait to have generational wealth, you can take proactive steps now to secure your financial legacy and protect your interests and that of your partner.
As with any legal document, it is important to seek the guidance of experienced legal professionals to ensure that the prenup is carefully drafted, legally sound, and aligned with the unique needs and goals of you and your partner.
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Good evening, my question to you please if open an account today in naira his the money will converted to us dollar to running the account
If you are investing in a dollar fund, yes.
Can the funds be traded rather than investing to increase gains?
What if your money is in cash(Dollar)
Please I already have an account, will I have to re-open another account before investing in dollar?
Can I invest in the next eurobond using dollar (cash)? If yes, will my returns be in dollar as well or it will be converted to naira??
Hi Helen, you can invest in Eurobonds at any time. However, we only accept naira deposits at the moment. Also, your returns accrue in dollars.
So which is best to earn the second way or first?
Focusing on returns will be better
Hi, what is the minimum amount you can invest with.
Hi there. You can invest the naira equivalent of $100
Hi Ope, does that mean I’d need two accnts to operate the fund, I.e a naira account to put in the naira funds which is d only 1 u currently accept, then a domicilary account where my returns would accrue in?
I want to invest in your Eurobond.
I have re-installed your new app an still can get the eurobond plan?
How much is the minimum equivalent dollar for a start?
Can i get an overview of all the benefits and rules of this plan?
***and still can’t get the eurobond plan?
Do you allow people from south Africa
Hello, my question is if I invest in the dollar mutual fund how do I get the returns?
Will it be in naira or in dollars and will I have to open another account for the returns to go into
Can’t you go down to 50USD
Hello Nsikak, currently the minimum is $100 but we we are looking at a possible review in the future.
The new minimum is $10
Hello will I have to re-open another account before investing in dollar?
luckysolomon444@gmail.com
I have invested in dollars mutual fund… It means I Will get my return in one year
Hi Jonathan,
How is the return/interest on your investment from November 27,2020 so far??
No you don’t have to, just click on invest in mutual funds, you will see the options there. You can navigate and alot with your account.
If I invest in the euro bond, it is expected that my return accrues in dollar, right? And how do I withdraw the dollar? Do I need to convert it to naira, if yes, how can I convert my dollar to naira on the app. Lastly, how long do I need to leave my investment on cowrywise? Or can I withdraw anytime?
Am interested. Let’s say I put in a $1,000. What the ROI…within 1 year.
Your interest is 6.6% then calculate it for one year, I think so
Hello,
As a Nigerian, can I save my money in dollars even though I don’t want to invest in a dollar mutual fund?
Pretty soon, yes!
If l invest in naira am l going to get it back in dollar
You’d be getting it at the prevalent naira exchange value of the dollar.
Am going to save in naira am going to get it back in dollar
You’d be getting it at the prevalent naira exchange value of the dollar.
Hello ope pls how much is $10 in naira
How long does the investment last.i.e when can I get my returns
I will give BIG CONGRATULATIONS to the entire Management of COWRYWISE for this wonderful opportunity to be a good investor with simple and sound education on various investment opportunities an investment can be done with little and grow within a short period period of time
God bless
Thank you so much ?
Now if I put 100$ in one year what is my return
If my return will be in the current dollar rate at the time, when i am investing and when am getting my returns, what exchange rate do u use? Black market rates or the bank rates – please verify in each case. Thanks.
Hello please if you can create the one we can start with the minimum $1 we’ll be happy ??
I just started investing in eurobond funds on cowrywise. So far so good, it has been a good platform to invest money and earn back. Kudos to the team behind this platform