Prenuptial agreements (Prenups)

Why Prenups Matter in Personal Finance

Prenuptial agreements offer financial clarity and protection, reducing disputes over wealth and property. They are particularly beneficial for business owners, individuals with significant premarital assets, and those with inheritance concerns.

For dual-income households, prenups help structure financial responsibilities during and after marriage. Prenups can protect premarital assets and secure children's inheritance from past relationships. They also shield one partner from the other's debts. With more women gaining financial independence and divorce rates rising in 2025, prenups act as safety nets for both partners.

Legal Limitations in India

Despite their benefits, prenups lack explicit legal recognition in India, as marriage is traditionally viewed as a sacrament rather than a contract. Only Goa recognises prenups under the Portuguese Civil Code, while the rest of India provides limited enforceability.

Prenups aren't legally binding, but they can be valid under the Indian Contract Act of 1872. They must meet certain requirements. Courts are starting to recognise prenups. For example, a 2024 Mumbai Family Court ruling saw prenups as proof of intent, but not as enforceable contracts.

Final Thoughts

While prenups remain in a legal grey area in India, they are growing in relevance as financial planning tools. Couples who want to protect their assets and avoid disputes should talk to legal experts. They can help draft agreements that courts may accept during divorce. As Indian society changes, prenups may gain more legal recognition. This would provide financial certainty in marriages.