The Average Price for a Prenup: The Definitive Guide

What is a Prenup?

In the context of marriage, a prenuptial agreement is a written contract executed by the parties to a marriage prior to the marriage containing provisions specifying the rights and responsibilities of each party in the event of a separation or divorce. Thus, the prenuptial agreement will generally address issues related to the division of property, the disposition of gifts, and the amount of support to be paid by one spouse in the event of a divorce. While not every prenuptial agreement contains all of these provisions, the more issues addressed in the agreement , the more valuable the agreement is in terms of minimizing disputes after the marriage has ended.
Many people are interested in prenuptial agreements because they hope these agreements will help them avoid the costs associated with litigation after the marriage has ended. Others have the impression that all the potential issues are straight-forward enough that an agreement can reduce the number of issues to be litigated. Still others have been pressured by their parents to get a prenuptial agreement because it can protect them from their spouse’s "money grubbing tendencies." In addition, many people signing childless prenuptial agreements hope that the cost of the agreement will be less than the cost of protecting the assets each spouse has brought into the marriage.

Factors that Will Affect Cost

Factors that Influence the Cost of a Prenuptial Agreement
The geographical location of the parties can play a significant role in the overall cost of a prenuptial agreement. In some jurisdictions, attorneys may have a more reasonable hourly rate or they may charge a fixed fee for services. In other areas, attorneys may be known to charge higher than standard rates.
Attorneys fees can also be affected by how long the agreement is going to take to draft. Depending on the complexity of the agreement and the involvement of both parties, the number of revisions to the agreement can be a significant factor when it comes to cost. A more simple agreement may only require one draft, while a more complex agreement with lots of unique assets may take multiple drafts and revisions before there is a final draft that is satisfactory to both parties.
More complex drafting will take longer than a more simple agreement, which would cost the parties more in attorneys fees overall. What would require more time include complex spousal support provisions, asset distribution and an order of prenuptial disclosure. The more complex a document becomes, the higher the costs of having the document drafted.
There is no way of telling beforehand how many drafts of an agreement there will be before the document is satisfactory to both parties.

How Much a Prenup Usually Costs

The general cost of a prenuptial agreement can range anywhere from $1,200-$8,000. One example may be as follows: the premarital agreement might be $4,000. If during the time period that the Agreement is in effect, the assets and net worth of the clients increases significantly (these are "good problems"), then a modification may be prepared which could range from $750-$2,500, depending on what adjustments are needed to address the revised values. This of course would be in addition to the initial Agreement amount of $4,000 bringing the overall cost to approximately $5,500, although in a situation of considerable wealth accumulation, the initial Agreement might be $10,000, and the subsequent modification might cost another retainer of $2,500, bringing the total property settlement agreement cost to $12,500. The ability to prepare time-of-agreement budgets and pre-needs approximations will empower clients to understand the basis for all costs and budget for the future.

Tips to Save Money

While it’s important to consult a lawyer, there are ways to save money performing routine tasks yourself.
Template prenup: Consider reviewing a template for a prenuptial agreement. Although each state will have specific requirements for a prenup (and you will have to confer with a lawyer for that), templates can give a good indication of what you and your fiancé(e) would like to address in the prenup.
Familiarize yourself with the law: In most states, one of the important requirements for a valid prenuptial agreement is that the terms of the agreement were fully disclosed to both parties. For this reason , it’s critical when negotiating and drafting your prenup to fully disclose to your fiancé(e) terms such as your pre-existing debts and savings accounts. Familiarizing yourself with rules and regulations surrounding prenuptial agreements in your state will help with this process.
Utilizing a mediator: Some couples find it beneficial to utilize a mediator when drafting a prenuptial agreement. The mediator can help draw up a draft of terms to be reviewed and discussed between prospective spouses. Through open and friendly discussion, the terms of the prenuptial can be written down, discussed and changed before the drafts are reviewed by each party’s attorney.

Things to Keep in Mind Legally

Different jurisdictions have varying laws governing the validity and enforcement of a prenuptial agreement. For example, the Uniform Premarital Agreement Act—which has been adopted in several states such as New Jersey, Pennsylvania, Florida, Massachusetts, and Illinois—contains a list of circumstances under which such an agreement might be deemed unenforceable. To be valid, a prenuptial agreement generally must be entered into voluntarily, with full knowledge of the terms, and with the opportunity to seek independent legal advice. If one spouse was pressured into signing a prenup or did not have sufficient information to understand the rights they were waiving, the agreement may be viewed unfavorably by a court. Approximately 500 miles west along the U.S.-Canada border, the Canadian province of Alberta has both a provincial and federal law system, and in that province, prenuptial agreements are governed by federal statute. Further east, the province of Nova Scotia follows the Restatement (First) of Contracts and common law from the rest of Canada. These very different sets of laws (and variations on those laws) can make the prenuptial landscape confusing for couples who often satisfy the residency requirements for more than one jurisdiction.
A 2002 survey of state statutes found that most states (more than thirty) had enacted some form of guidelines for the handling of prenuptial agreements; however, there is no universally accepted standard. Indeed, at least one state, Utah, did not have any statute about prenuptial agreements prior to the 2002 survey and has not since. Many of the laws involve guidelines on the drafting process—required disclosures, how long prior to the wedding the agreement needs to be signed to avoid invalidation, how to effectuate amendments and discharges, etc.—but only a handful regulate what specifically a prenuptial agreement can address or restrict. For example, the Nebraska premarital agreement act (enacted in 1990) prohibits non-physical forms of sexual and reproductive control—a dissolution of marriage cause for action—and goes further by stating that agreements may not limit child custody or child support obligations (a restriction employees of a child support agency in South Carolina have begun to enforce). Beyond these, only a few other states have laws that limit what may be covered in a prenuptial agreement.

Long-Term Gains vs. Immediate Expenses

While the initial outlay for creating a prenuptial agreement is significant, in the long run the financial benefits can far outstrip the costs associated with its formation. To give you an example, if you own and manage your own business, the value of that enterprise could easily go into the seven-figures. Without a prenuptial agreement, your spouse could potentially collect half of the business in the event your marriage ends in divorce. A properly written prenuptial is like a liability policy. You can avoid exposure to huge unknown costs should the worst happen. In addition , funds that might otherwise go to your spouse in a divorce could potentially be used to make worthwhile gifts of money to heirs, such as children from a previous marriage. This means that if you have children before getting married again, a carefully crafted prenuptial agreement could actually benefit those children by easing the division of your property in the event of your death or divorce.