Will Wealth Acquired Pre-Marriage be Shared on Divorce?

Colin Davies, Senior Lawyer

More couples than ever before are waiting until their early 30s to marry, according to Office for National Statistics data.  In 2022, more first marriages took place between couples aged 30-34 than in any other age group. More re-marriages took place between the ages of 60-69, for men, and 50-54, for women, than in any other age group.

With couples marrying later, there is greater potential for wealth to have been acquired before their marriage. If a couple divorces, having entered their marriage with pre-acquired wealth, there are several key considerations which will determine if this pre-acquired wealth will be shared between them.

These considerations are:

1. The financial needs of the parties and any children they have. Can these needs be met without sharing the pre-acquired wealth?
2. Is the pre-acquired wealth held separately, or invested jointly?
3. The length of the marriage.
4. The standard of living the couple have enjoyed.
5. The contributions each spouse has made during the marriage.

Mr and Mrs A had both been married before and divorced. They met and married in their 60s. When they met they both had significant assets, having recently retired after selling their own successful businesses. Their marriage lasted five years. Although Mr A’s assets were worth considerably more than the assets held by Mrs A, they both individually had more than sufficient funds to meet their needs for housing, income and pensions on retirement. In these circumstances, it is likely that both spouses would retain their own assets, with no element of sharing the pre-acquired wealth.

Mr and Mrs B married in their 50s. Prior to their marriage Mrs B had a very successful career in the media and had built up significant wealth. When they married, Mr B moved into Mrs B’s home. He continued with in his career in teaching. Mr B had been married previously and transferred his former matrimonial home to his first wife as part of their divorce settlement. When Mr and Mrs B divorced after seven years of marriage, Mr B had no savings of his own to purchase a home, although he did have a teacher’s pension to provide a reasonable income for him in retirement. In these circumstances it is likely that Mrs B would need to provide a fund for Mr B to purchase and furnish a property, suitable to meet his needs.

Mr and Mrs C married in their early 30s. Mr C had won the lottery ten years earlier and had assets of significant value. Mrs C worked as a financial advisor and following their marriage she helped Mr C with the management of his various investments. These increased in value significantly during the marriage. The couple’s wealth was held in their joint names and they also held assets in their own sole names. They divorced after 35 years of marriage. The fact that Mr C had introduced the wealth to the marriage initially would be less important in this scenario. The couple had enjoyed a very high standard of living over a long marriage and had three children together. Mrs C had contributed to the growth in the value of the investments. In these circumstances it is more likely that their wealth would be shared between them when they divorced.

A further key consideration will be whether the couple entered into a pre-nuptial agreement. A pre-nuptial agreement is particularly beneficial for couples who are marrying later in life, or those who already have significant assets acquired prior to their marriage. A pre-nuptial agreement allows the couple to record their intentions about how these assets should be divided in the event of a divorce.

If you would like more information on pre-nuptial agreements, please contact our family team on 0161 832 3434.