NEW YORK — It’s well known that millennials prize experiences over possessions, but the latest trend in prenuptial agreements shows that this generation might also favor protecting what’s in their head over what’s in their wallet.
The number of millennials seeking prenups is on the rise nationwide, and it’s thoughts and ideas that individuals want to protect in case of a bitter breakup.
“Millennials are getting older and richer,” said Randall Kessler, a family lawyer based in Atlanta who specializes in divorce. “Prenups used to be for old money, but now prenups do different things, like safeguarding intangible property.” A decade ago, only 5 percent of the prenups Kessler’s firm worked on were for millennial-aged clients. Today, that number is about a quarter.
Just over half of matrimonial attorneys saw an increase in millennials requesting prenups over the last three years, according to a survey of 1,600 lawyers conducted by the American Academy of Matrimonial Lawyers. While it’s not just millennials — 62 percent of those polled said clients of all ages are increasingly asking for prenups — there’s a notable increase among millennials.
Prenups for millennial clients have been on the rise for several years at Buchanan Ingersoll & Rooney, said attorney Barry Slotnick. The demographic, he explained, is more concerned about its fiscal future and very cognizant of divorce rates, prompting millennials to increasingly draft prenups.
Instead of focusing on alimony and inherited cash, prenups requested by millennials aim to protect intellectual property such as films, songs, screenplays, software, apps, and even ideas for technology concepts yet to be executed. Real estate, the great unifier of married couples of all ages, is also typically included in these agreements.
These new-school prenups “would have language that went into the future for things that are not yet in existence,” explained Steven Kirson, a divorce attorney who first encountered a millennial requesting this type of prenuptial agreement about six years ago.
“I think there’s a heightened focus on the creation of something, whether that’s in the form of intellectual property or a business that they would establish in the future,” explained Michael Mosberg, a partner at Aronson, Mayefsky & Sloan LLP, a family law firm that has also seen more millennials seeking prenups over the last five years. “They want to protect that idea.”
Attempting to protect potentially profitable ideas that don’t yet exist is no easy task, legally speaking. Kessler occasionally consults with other lawyers to ensure that the prenup his team is working on identifies and values the intellectual asset correctly. “How do you know what it’s really worth?” Kessler asked of the ideas millennials attempt to protect. “It’s a gray area.”
Though millennials are increasingly getting prenuptial agreements, there’s no guarantee that they’ll ever need to use them. The divorce rate has fallen, in part because fewer Americans get married and those who do tend to do so when they are older. Over the last three years, John Slowiaczek, president elect of the academy, has seen a rise in cohabitation and partnership agreements drafted by attorneys for millennial couples.
“Marriage creates an obligatory situation,” he explained. “A cohabitation is two people who just decide to live together.”
While these agreements might be popular with millennials who are wary of getting the law involved in their love lives, they have their downfalls, such as setting up inheritance, health care, and child-rearing rights between partners that are otherwise granted upon marriage.