A new survey from Irwin Mitchell suggests a lack of clarity and legal transparency over digital assets is leading young people to seek protection through pre-nuptial agreements.
The survey of 1,000 UK asset holders aged between 18 and 44 revealed 67% of participants don’t believe the law has kept up with the growth of digital assets. The legal ambiguity is behind a boom in the popularity of prenups, Irwin Mitchel suggests, with 47% of those questioned saying they would consider the agreement to protect assets including cryptocurrency and monetised social media accounts.
A quarter of the respondents (25%) said prenups are smart practical tools when entering into a marriage or civil partnership, with 19% saying the agreements would offer clarity and avoid future conflict. Only 12% of those asked said a prenup signalled distrust in a partner.
“We’re still a long way off it being an automatic consideration when people get married, but I do think there’s an increase in people thinking about it,” said Hayley Trim, partner at Irwin Mitchell.
The courts are also becoming more accepting of the contracts, Trim added.
“It’s gone from the idea that a prenup was contrary to public policy, to it being something that is given considerable weight and will almost certainly be upheld by a court if it fulfils certain criteria.”
The survey also sheds light on the growth of digital assets among younger people, with 32% saying they own cryptocurrency. Around one in five of those (17%) are content creators with a monetised account.
Almost two third of the cryptocurrency owners (58%) said they were considering a prenup to protect their digital wealth, rising to 65% of the content creators questioned.
However, Irwin Mitchel partner Nathaniel Groake highlights disparities between the concerns of younger adults and the law as it stands, particularly with regard to financial disclosure and Form E.
“You have your bank accounts and your investments, and in cryptocurrency, within that month leading up to a final hearing, it could fall 50%, or increase 50% or even 500%, depending on the risk,” he explained.
“Even on a day-to-day basis, it can vary so wildly that I think the system is probably going to evolve to actually have judges looking at real-time investment value.”
Although Groake says there will be difficulties in drafting prenups for young people at the start of a relationship, when any assets are minimal, he welcomes the shift in attitude.
“These generations aren’t scared of setting boundaries and legal documentation to outline wealth and assets at the very start of a marriage or civil partnership,” he noted.
“For these young people, a prenup is now seen as a smart, proactive investment in a partnership’s future clarity. It simply makes sense to have everything in writing to avoid any potential conflict in years to come.”
Irwin Mitchell: How Digital Assets Are Driving a Prenup Boom Among Young Brits
