Getting married is an exciting time. You are thinking about venues, wedding dresses, who to invite, etc.

However, it is important to spend time considering your marriage contract, as this could significantly affect your future financial situation.

In South Africa, couples are automatically married in community of property if there is no antenuptial contract (ANC) in place.  When you sign an ANC, you will marry out of community of property.

Some advantages of a marriage out of community of property are:

• Asset protection: Each spouse's assets are protected from the other spouse's creditors.
• Financial independence: You do not need your spouse’s permission to take out credit or a home loan, to sell or buy an asset.

Couples may enter into one of two types of ANC –

1. An ANC that excludes community of property and community of profit and loss, but includes the accrual system.

The term ‘accrual’ is used to denote the net increase in value of a spouse’s estate since the date of marriage.  In other words, what was yours before the marriage remains yours, and what you have earned during the marriage belongs to both of you.

Spouses will be able to structure it to the needs of your future financial goals as a couple. You can decide to exclude specific assets named in the contract and/or each spouse can place a net value on his/her assets at the beginning of the marriage. Upon death or divorce, the spouse who’s estate shows no accrual (growth), or smaller accrual will have a claim against the spouse who’s estate has grown more. This claim can only be equal to half of the difference between the two estates.

2. An ANC that excludes community of property, community of profit and loss, and the accrual system;

There will be no sharing of debts or liabilities and each of the spouse retains his or her independence. Their assets remain their own separate property and cannot be touched by any creditor. This also applies to any insolvency by one of the spouses. When the marriage terminates either through death or divorce, there is no accruing (“without accrual”) of the assets of the couple. There is also no distribution of the assets on dissolution of the marriage.

The ANC needs to be concluded before the date of the marriage and must be registered at the Deeds Office within 3 months from date of signature.

Should you require assistance with drawing up of an Antenuptial Contract by a suitably qualified attorney (notary public), give us a call.